Dollar Shave Club: Disrupting the Shaving Industry

Brand profile
The value proposition of Dollar Shave Club is straightforward recognizing customers needs of
razors and paying excessive prices for well-known brands of razors. DCS provides high-quality
generic substitutes that are delivered directly to the customer’s address in the manner of the
client preferences and nececities. DSC abandoned its promotion of the sophisticated razors and
focused on simplicity and affordability for customer demands. It highlights low prices and
convenience to consumers offering making their life easier. The new place to market a product
today is online, using social media including Youtube and the company uses this sources to
target its customers.

DCS creates value for customers by emphasizing the customer’s needs by providing a variety of
products not only razors like its competitors as well as offering memberships and automatic free
delivery to cover those customer needs. Today, more and more companies recognized that
convenience is the value for customers and they are looking for the easiest way to get the
products and worry less of driving. They can even go the program to order the necessary amount
of the product even with out thinking to they need to buy it.

Those companies who use this auto-shipping program build customer loyalty. Customers stick
with the company once the customer sing up for recurring orders and have entered all the bank
information. They will find more convenience for them by saving time in their end. Convenience
and time are the most important factors to look for nowadays. Besides these two aspects, auto-
shipping also offers discounts and other product lines. DCS offers shaving products, including
razors, oils, shave creams, etc. In addition, hygienic, protective, and fresh grooming products are
offered as well. This is how DSC differs from Gillet’s value proposition.

The business strategy used by Dollar Shave Club is Business to Consumers. DSC has a strategy
for its customer subscription base and e-commerce model. Those characteristics set it apart from
its competitors. Its value proposition is reasonable prices, excellent customer centricity, and
customer service. The firm uses a subscription revenue model as its income source. For only
$1.00 per month during the trial period, it charges $2.00 per month for the humble twin, $6.00
per month for 4 cartridges of 4x and $9.00 per month for 3 cartridges of the executive razor per
month. All prices include shipping and handling costs.

By producing goods at lower cost in South Korea and having the direct customer based model
handle their own distribution, Dollar Shave Club eliminates the traditional retail locations.
Customers will only find DSC products online and they will find them at a lower cost compared
to retailers.
Strategic Options Open to Dollar Shave Club to Increase Sales and Customers
Business to Business Distribution Model

To expand Dollar Shave Club into a new market for e-commerce distribution. The DSC has a
successful market of B2C ecommerce. However, there is a market development strategy to target
a new segment of customers and these customers are people who are not interested to sing up to
an autoship service. Many clients are not willing to do all the process of programming the app
and set up all the payment processes. They still use to go to the store, grab the options they find
in the store shelves, and pay in the cashier. They are considered old school because they do not
know how to deal with technology.

This segment of the market are Generation X and few millennials. This is a new channel to target
them by selling DSC products to retail stores like Walmart and Target. This is a big gap for DSC
and its products due to there are 19.61 % of Generation X and 21.67 % of the millennial
populations in USA.
Pricing Model

What are the short-term and long-term strategic options for Gillette?

References

Anderson, J., Kollenz-Quetard, K., & Tavassoli, N. (2018). Dollar shave club. HBS No. LBS150.
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Gary Nealon Find Me On: Gary is the President of Nealon Solutions. (2023, May 3).
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https://www.garynealon.com/ecommerce/auto-ship-programs-are-they-right-for-your-
business#:~:text=An%20auto%2Dship%20option%20can,to%20enjoy%20their%20favorite
%20products.

The impact of growth strategy on marketing concepts in service companies. (n.d.).

https://www.researchgate.net/publication/365517560_The_Impact_of_Growth_Strategy_On_Ma
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