Dollar Shave_Club

A cut above the rest? Brilliant marketing from The Dollar Shave Club has seen a successful takeover by Unilever, who have launched the brand in the UK

In 2012, Dollar Shave Club announced itself to the world via YouTube. The video, called ‘Our Blades Are F***ing Great’, was provocative and funny and made a star of charismatic CEO Mike Dubin, who introduced the concept: “For a dollar a month we send high-quality razors right to your door.”

Only a dollar? It went viral and over 25 million views later the comments below say it all. “Simply brilliant”, “the greatest commercial of all time” and “I don’t only f**king love this commercial I am going to sign up!! A visionary and funny CEO gets my money before Gillette who’s been raping me for years.”

If that’s harsh, it’s true that paying the steep price for razor blades has long been as wince-inducing as a nasty shaving cut. As a result, DSC’s winning ad returned 12,000 orders in 48 hours. Sales grew from $4m in 2012 to $65m in 2014 and $152m in 2015.

These numbers will have startled razor giant Gillette and its parent company P&G. But instead of subsuming this canny upstart it was Unilever, P&G’s biggest rival, that splashed out $1bn for DSC in 2016. Since then, Unilever has built scale in the US (where DSC has 54% of the online shaving market compared with Gillette’s 21% according to Euromonitor), and in Canada and Australia.

Finally, in February, DSC hit the UK. So how does Unilever plan to roll it out? Will DSC’s irreverent style be blunted now it’s part of a giant conglomerate? And what are its razor sharp rivals planning in response?

DSC operates independently of Unilever, with around 300 staff. Mike Dubin remains at the helm (albeit on a board alongside three Unilever executives) and former Unilever and P&G exec Bart Kuppens leads the UK operation. He’s confident the low level of subscription shavers in the UK means there is plenty of opportunity for DSC to grow here. He plans to get DSC established before rolling out a wider range of skincare products later this year.

As for its brilliantly successful early marketing, today DSC plans to win over the UK by working with social media influencers and global media giant Mindshare, a Unilever favourite. But back in 2012, DSC “dared to dump the 80s pomposity that had saturated the market” says Chris Moody, global chief design officer at Wolff Olins.

“They did one unimaginable thing: they actually had a purposeful personality, they took the piss, and as a result land grabbed market share.”

Now DSC is part of “the grown-up Unilever family” it needs to “continue to push and be challenging. It can’t pretend it’s a naive youth any more, but that doesn’t mean it has to develop a safer, duller personality.”

Is Unilever worried that will happen? “It’s still very early days, but we’ve had some fantastic feedback following the launch of Dollar Shave Club, which has brought its distinct personality to the UK,” says a spokeswoman. “We have a track record of bringing innovative brands into the Unilever family and allowing them to operate independently, so they retain their unique proposition for consumers.”

As for how DSC’s rivals plan to respond, US-based shaving website Harry’s beat DSC to the UK, arriving last June. And it sounds relaxed and confident about the arrival of DSC.

“We already coexist with big players in the US and have quite a unique proposition as we have invested in our infrastructure as a priority,” says Matt Hiscock, UK GM at Harry’s. “We are vertically integrated and have our own factory in Germany, which enables us to react very quickly to our customers’ needs and give them the best experience possible. Something others aren’t able to do.”

How cut up is Gillette?

Chief rival Gillette seems a little more rattled. “This is a pivotal moment for health & beauty,” says Ian Morley, P&G group sales director for Northern Europe. “This is not just about the shave category, it’s about the entire department. If you look at the US, the direct-to-consumer players all expand into adjacent categories.”

It’s already happening in the UK. Cornerstone, which sprang up in July 2014 like a UK copy of DSC, plans to diversify in 2018.

“In response to demand from our members, we are moving into multiple new categories including vitamins, shampoo and dental care,” says founder Oliver Bridge. “While DSC and Harry’s battle it out to see who can offer razors slightly cheaper than each other, Cornerstone is solving a much bigger problem for men by automating the bathroom cupboard and doing away with the need to shop for any toiletries ever again.”

Of the three, DSC “feels the most ‘big brand’ of the three,” says Pete Hayes, director at PB Creative. “Harry’s stripped back look is simplistic, maybe basic to some. Cornerstone feels the fresher of the three and more grounded for the UK market.”

Whichever one takes the lead, Gillette, with a commanding 70% of the UK razor market, is well placed to defend itself. As well as traditional retail channels and online supermarkets, it launched the Gillette Club in June 2015, offering a similar money-saving subscription model to DSC, Harry’s and Cornerstone.

And though sales of Gillette razors & blades fell 1.8% to £248.4m last year, and preparations like gels and foams dropped 6.5% to £30.2m [Nielsen 52 w/e 9 September 2017], Morley has confidence Gillette will remain “the best a man can get”.

“The definition of value is at the heart of this,” he says. “Shoppers define value as the blend of the price they pay and the benefit they get. They will reject products that fail to do the job, or if they need to repeat purchase more frequently and end up paying the same or more for a lesser quality product.”

And as good as the reviews for DSC’s ads are, Gillette has some pretty favourable ones on its Club website, written in January. “I tried one of the other clubs and there is no comparison to the quality of Gillette blades,” reads one. “Yeah it costs a little more initially than the other shave clubs. But in the long run it actually costs less.”

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