How Dollar Shave Club disrupted the razor industry with monthly blade subscriptions
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See how this entrepreneur changed men's shopping for shaving supplies and built a successful business with this ValueMap case study.
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How Dollar Shave Club disrupted the razor industry with monthly blade subscriptions
- 2. Men Early 2000’s © 2016 Lionel L. Fray Associates, Inc. Retailers Razor Blade Mfrs. • Razors for shaving • Advanced features— multiple blades, lubricating strips, etc. • Cost: about $25/mo
- 3. Men Early 2000’s © 2016 Lionel L. Fray Associates, Inc. Retailers Razor Blade Mfrs. • Comfortable shave • Blades that last a week or more • Razors for shaving • Advanced features— multiple blades, lubricating strips, etc. • Cost: about $25/mo • $3b market US
- 4. Men Early 2000’s © 2016 Lionel L. Fray Associates, Inc. Retailers Razor Blade Mfrs. • Comfortable shave • Blades that last a week or more • Razors for shaving • Advanced features— multiple blades, lubricating strips, etc. • Cost: about $25/mo • $3b market US Gillette • 70% US Market Share • 2005 sale to P&G, $57B
- 5. Men Early 2000’s © 2016 Lionel L. Fray Associates, Inc. Retailers Razor Blade Mfrs. • $3b market US • Razors for shaving • Advanced features— multiple blades, lubricating strips, etc. • Cost: about $25/mo • Purchasing process -Requires shopping -Time to drive to drug store -Get someone to unlock cabinet -Wait to pay -Drive home • Perceived high cost • Comfortable shave • Blades that last a week or more
- 7. Men 2011 © 2016 Lionel L. Fray Associates, Inc. Retailers Razor Blade Mfrs. Post Office Promoter/ Packager DSC • Monthly mail delivery • Cost less than half • Saves shopping time • Never run out of blades
- 8. Men 2011 © 2016 Lionel L. Fray Associates, Inc. Retailers Razor Blade Mfrs. Post Office Promoter/ Packager DSC • Monthly mail delivery • Cost is less than half as much • No time spent shopping • Don’t run out of blades You Tube • Founder Mark Dubin becomes the ‘face’ of DSC • Viral You Tube video, 240M downloads
- 10. Men 2011 © 2016 Lionel L. Fray Associates, Inc. Retailers Razor Blade Mfrs. Post Office Promoter/ Packager DSC • Monthly mail delivery • Half the cost • Shaves match Gillette • Save shopping time • Never run out of blades You Tube Men Who Don’t Like to Shop New market segment
- 11. Men 2016 © 2016 Lionel L. Fray Associates, Inc. Retailers Razor Blade Mfrs. Post Office Promoter/ Packager DSC • Monthly mail delivery • Half the cost • Shaves match Gillette • Save shopping time • Never run out of blades You Tube Men Who Don’t Like to Shop • $1B 2016 sale to Unilever • 3M Subscribers • $280M sales
- 12. In Value terms, how did DSC do it? • Converted negative values to positive values • Accelerated the business launch by using YouTube in a creative way • Expanded the business space by creating and capturing a new market segment • Leveraged supporting value stages – Post office – Korean blade manufacturer – Scale business with AWS • Captured the most value in the segment he created, and capitalized this value © 2016 Lionel L. Fray Associates, Inc. 12
- 13. Men 2016 © 2016 Lionel L. Fray Associates, Inc. Retailers Razor Blade Mfrs. Post Office Promoter/ Packager DSC • Monthly mail delivery • Half the cost • Shaves match Gillette • Save shopping time • Never run out of blades You Tube Men Who Don’t Like to Shop AWS • Expanding DSC’s product lines • Soap, body cleanser, wipes, shaving cream