Ask @RetailPhil: Is Direct-to-Consumer Dead?
There’s been widespread coverage surrounding the recent sale of Dollar Shave Club to CPG brand Unilever. This billion dollar deal saw members of the Dollar Shave Club – all 3.2 million of them – joining the Unilever family. Meanwhile, Andy Katz-Mayfield, founder of another popular men’s grooming brand, Harry’s, has also just announced plans to partner with big box retailer Target in order to sell Harry’s blades in their 1800 stores.
What’s so special about Harry’s and Dollar Shave Club, aside from a quick rise to fame?
Collectively, Harry’s and Dollar Shave Club gained around 5 million consumers from the men’s grooming market, almost overnight, simply through directly engaging with them in way that no other company would.
Dollar Shave Club’s mantra has always been, “A great shave for a few bucks a month!” with a simple call to action. Harry’s story is similar in that they seek to connect with their customer and foster a community based on the need for affordable grooming products delivered right to their door. Their raison d’etre? “Like most of you, we’ve long had to choose between over-priced razors that disrespect your intelligence, and cheap razors that disrespect your face. We knew there had to be a better way, so we created Harry’s as a return to the essential: a great shave at a fair price.”
Hence the term, “Direct-to-Consumer.” Valuable lessons can be gleaned from both grooming companies about how to be genuine in your interactions with your community and how a simpler business model can sometimes be more effective in today’s complicated world of retail.
As these two great examples of Direct-to-Consumer retail seemingly fall by the wayside, what does this mean for the rest of the industry? Both Harry’s and Dollar Shave Club have indicated that they aim to keep their pricing the same, but the community has yet to sound off about whether or not they’re happy to be possibly re-joining the rest of the CPG world, having to scour retail shelves for these products (rather than wait for the mailman). Will another brand step in to leverage this simple and highly effective way to reach customers? I guess we’ll have to wait and see!
Have a retail-related question?