Razors, Big Red Car?
OK, Big Red Car here talking about when a successful small company competing with a bigger company attracts the attention of the bigger company and the bigger company takes action.
Big Red Car, what are you talking about?
OK, it’s about the razor business and entails three companies:
1. Dollar Shave Club (first mover in the space) — razor blade subscription service;
1. Harrys (with Warby Parker vibe) — makes their blades in Germany where they own a factory; and,
3. Gillette — which just re-launched its own subscription blade service, Gillette On Demand. Gillette is the “bigger company” of which we spoke. [Cue the ominous, dark, Darth Vader music in the background. Please.]
Each company is a little different, but at the end of the day (cliche alert) they want to get you to join a “club” so they can sell you razor blades. They will almost give you the razor itself if you will just become a faithful purchaser of their subscription based blades.
There are others in the subscription razor business, but these are the big three, y’all.
Dollar Shave Club
DSC (abbreviated, very hip) was started by a guy (Michael Dubin) in classic bootstrapped fashion back in 2011. The story is apocryphal (vocabulary word for the BRC). Today, they are doing more than $100,000,000 in sales. [It is hard, as it should be, to get numbers on private companies. One resorts to looking at places like PitchBook. Do not believe any Big Red Car numbers about anything.]
Big deal. Along the way, they took some VC money, so they have miles to go before they sleep.
DSC has gone a bit farther afield and now sells a wider range of personal hygiene products. You will adore their aloe butt wipes — yes, that is really a thing.
It is hard to get exact numbers, but DSC mumbles that they have 3,000,000 members of their club. Who really knows?
Harrys
Harrys was founded in 2013 by a founding team which had Warby Parker on their list of things they’d done. Very heavyweight success. Their secret sauce was the fully integrated vertical stack.
They saw Gillette and Schick as their competitors and they went out and raised money to be able to buy a $100,000,000 razor factory in Germany. Bit of integration, no? Full stack, no?
I think of them as being a bit more visual and all that graphic design stuff [Full Disclosure: The Perfect Daughter is an accomplished graphic designer working at her second startup, Bustle.com, whereat she was their first graphic design hire and now they have a battalion of similarly skillful persons. Sorry.]
Harrys has raised almost $300,000,000 and one of its boardmembers and investors (through Thrive) is a chap named Joshua Kushner — the liberal brother of Jared Kushner, the husband of Ivanka Trump, and a senior adviser to the Devil himself.
Gillette
Darth Vader music, please.
Gillette is the big boy, the one your mother said was a bully in the third grade and why your Dad taught you hand-to-hand combat and how to box. [Not really, but, hey, we love the drama.]
Gillette, around since 1901 when it did a seed round, ignored the upstarts whose entire shtick was how difficult it is to buy razor blades.
Something happened over at Gillette and they are no longer ignoring the upstarts anymore. They launched Gillette On Demand in retaliation, saying, “Hey, you can’t eat out of our chili bowl.”
They launched Gillette Shave Club in 2015, but there was some ugliness and confusion about the name. They changed it to Gillette On Demand.
Gillette On Demand has CHAT, live chat. You can call Shemeka (actual person with whom the Big Red Car chatted in researching this blog post) and she will help you in ways you cannot begin to imagine. Well played, Shemeka.
The exhausting process of buying razor blades
Women have no appreciation for how time consuming and physically draining it is for guys to buy razor blades. It is grueling, like Ranger School.
You have to get in your car.
You have to start your car.
You have to drive to the drug store (or Sams Club).
You have to park your car.
You have to pick out your razor blades (this is not an easy task, girls, ask a guy).
You have to cart them to the checkout.
You have to pay for them.
You have to count your change.
You have to find your car in the parking lot.
You have to get in your car.
You have to start your car.
You have to drive home.
You have to park your car.
You have to go upstairs and shave using shaving butter (yes, no more shaving cream, it is now saving BUTTER)
Point of emphasis: this is all being done, doll face, to make ourselves attractive for you and to avoid razor burn in the clinches. All. For. You.
Don’t know about you, but I am exhausted. Who knew buying razor blades was so damn complicated and time consuming.
Bottom line it, Big Red Car
OK, dear reader, a handful of teachable moments present themselves.
1. If you start a business which is going to compete with one of the big boys — disruption, disruption, disruption — the big boy may decide to compete with you.
You may be nimble, lean, agile and all, but the big boy can learn how to do it and they have Shemeka and LIVE CHAT in their bag of tricks.
2. There is, essentially, no difference amongst the offerings. You want five blade razors? Everybody has five blade razors. No product differentiation. None.
3. There is no huge price difference amongst the offerings.
I do think Gillette On Demand may go ugly on an ape (technical marketing pricing theory term) on this, but they also have to protect their brick & mortar retail pricing. [BTW, Harrys is going to be selling their products in Target. Hello, America! Hey, I thought it was incredibly difficult to go to a brick & mortar retailer to buy a razor blade. What happened to that? Target?]
I did not develop this from an intelligence spilled by Shemeka. She is not that kind of girl. Hell, I don’t even know if she’s a girl or not. Her real name could be Bob.
4. This is a subscription service and the promise of delivery in a short period of time taps into the Internet impatience of living cool today.
This is a huge phenomenon and the Big Red Car is amongst the laziest big red cars on the planet. He almost thinks that if you can’t guy it on Amazon, why do you want it in the first place?
I know what you’re thinking — doesn’t Amazon sell razor blades, Big Red Car?
So, there you have it. The razor wars are upon us and you’re still on your first cup of coffee.
But, hey, what the Hell do I really know anyway? I’m just a Big Red Car. Date night! Take a minute and do something incredible for someone today. Not a big thing. Get a Big Red Car an oil change?
