Kerry Sullivan, recently drafted from Neutrogena as Dollar Shave Club’s chief marketing officer, has a knotty branding challenge on her hands.
She has to find a way of squeezing more growth out of a small disruptor brand, defined by its tightly focused and direct value proposition, without destroying the brand itself.
It’s a conundrum that has confronted and confounded many an entrepreneur that built a successful business on a small but disruptive idea. In this case, the entrepreneur, Michael Dubin, has passed on that particular hot potato to Unilever. The former improv comedian sold the company to the packaged goods giant for $1 billion in 2016. And now it’s in Ms. Sullivan’s in-tray.
The online company came out of nowhere just five years earlier and put a small but significant ding into the $5.7 billion wet shave market dominated by Gillette.
The name, Dollar Shave Club, quite literally spells out Michael Dubin’s highly opportunistic and effectively simple business model. Dubin met a friend’s father at a holiday party in late 2010 who asked him, with his e-commerce experience, could he help move 250,000 razor blades sitting in a warehouse.
Dubin immediately went to work setting up an online subscription service that offered a great blade delivered to your door each month for one dollar per blade. The name, Dollar Shave Club, said all there was to say.
What happened next is the stuff of business legends.
With a laser-like focus on his target audience – men like him who were fed up with a razor monopoly that forced them to pay more than $20 for just a few blades – Dubin fell back on his stand-up comic background and created a very funny tongue-in-cheek video casting himself as the protagonist in the Hero’s Journey of his own brand.
When the video was released on March 6, 2012, it went viral. The startup got more than 12,000 orders in the first 48 hours. By 2015, the year before it was acquired, the company was generating sales of $152 million.
What does Act 2 look like?
Though Dollar Shave Club’s direct-to-consumer model may once have been relatively unusual at the time, it became more common during the pandemic as consumers increasingly turned to the internet to purchase household items. Now, we are seeing something of a post-pandemic reckoning for subscription-based businesses.
Netflix sounded the alarm earlier this year. In the first quarter of 2022, the streaming giant reported losing 200,000 subscribers, marking the first time it lost subscribers in over 10 years. On top of that, Netflix expects to lose another 2 million more subscribers this second quarter.
For Dollar Shave Club, success will require the most delicate and adroit balancing act along a razor’s edge of brand management – how to grow the business as a club that offers more than a clean shave without undermining its challenger image and alienating its core customer base.
The lessons are there for the learning – from Kentucky Fried Chicken to Dunkin’ Donuts. They struggled to grow and diversify beyond their core business because the brand was immutably anchored to the product proclaimed in their names.
Can Dollar Shave Club do it? The new ad campaign showcases its broader-based product offering. The humor is still there but it lacks the heart and spontaneity of the original. The conversation around the brand has become blandly corporate and cold. The plan for “DSC,” as it’s now referred to, is to become an “omnichannel grooming brand.”
Dollar Shave Club would do well to look at the parallel with Weight Watchers’ and its drift into brand meaningless as “WW” in an attempt to move beyond a dieting focus into a broader-based wellness offering. By all accounts, it’s not going too well.