Dollar Shave Club Us, Please!
By Mark DiMassimo
Unilever recently announced its purchase of Dollar Shave Club for a cool billion dollars in cash, and now our mobile devices are buzzing with prospective clients beseeching us…
“Dollar Shave Club Us, Please!
Well, I’m not one to say, “I told you so!” But, I’m going to make an exception this time.
I’ve been talking up Dollar Shave Club for the past four years. In the beginning, when the company’s launch video went viral, people thought I made a lot of sense. Six months later, they thought I had fallen behind the times, and within a year many suspected I had developed a troubling obsession with a quirky little mail order outfit.
I interviewed Dollar Shave Club’s creative director, Alec Brownstein, for my Inspiring Action podcast.
I wrote about the company in at least six different blog posts and posted about them frequently on social networks, imploring marketers to learn what Dollar Shave Club exemplified: how to drive up brand value while driving down cost-per-acquisition.
Why the passion? Here’s why:
1) Dollar Shave Club showed us how a tiny company with a social-led brand response acquisition strategy can take share from giants. (Proctor & Gamble’s market cap is something like $232 billion!)
2) Dollar Shave Club showed us that the direct economy is taking over, and the billion dollar purchase shows us that the Unilevers of this world know it too.
The Wall Street Journal said, “Dollar Shave Club’s direct-to-consumer model gives Unilever unique consumer data and insights, according to the Wall Street Journal.”
According to Bloomberg, Unilever and P&G are masters at traditional marketing, mostly offline, but they struggle with the direct-to-consumer brand-building at which upstarts like Dollar Shave Club excel.
“These startups conduct authentic-seeming conversations with customers over social media, while the consumer products conglomerates take to Twitter and Facebook mostly to address customer complaints,” said Ryan Darnell, a principal at Basset Investment Group, which invests in such e-commerce startups as luggage seller Raden.
3) Dollar Shave Club showed us that the ultimate role of social-led, mobile-driven marketing is to drive down overall cost-per-acquisition while driving up brand value. They weren’t free media purists. They bought TV commercials and other paid media, and they optimized the efficiency and impact of the mix.
4) Dollar Shave Club showed us where the jobs are going, and what the modern definition of lean is. According to the New York Times story, $1 Billion for Dollar Shave Club: Why Every Company Should Worry, “The deal anecdotally shows that no company is safe from the creative destruction brought by technological change. The very nature of a company is fundamentally changing, becoming smaller and leaner with far fewer employees.”
5) Dollar Shave Club built a real brand because they thought of brand in the largest sense – Big Brand — not just as logos and standards, but as the entire customer and market experience. According to Bloomberg, “The key to Dollar Shave Club’s appeal is not so much its online prowess but the fact that it built a powerful brand in four years.”
6) Dollar Shave Club exemplifies the Ten Signs of an Inspiring Action Company, which mark brands that tend to outperform in driving sales growth and brand value. The company knew what it was against – ridiculously high priced grooming products for men, starting with shaving. It knew what it was for – affordable grooming you could brag about. Dollar Shave Club’s leaders knew what their target aspired to be and do – well-groomed and smart, not cheap and face-nicked. And they knew their devotees loved being members of a cool club with lots of well-designed visual signs of their membership.
7) Dollar Shave Club used technology and system to shorten the cycle of test and optimization and to speed growth. The New York Times showed how small the company was able to remain by leveraging technology to the fullest, contrasting Dollar Shave Club to the giants that are shedding jobs by the thousands, searching for “efficiencies.”
8) Finally, Dollar Shave Club dramatized their brilliant brand idea with a few iconic actions that got us all talking, sharing and working on promoting the company for free! First, of course, was their brilliant viral video. But notice something about it that is absolutely key – it isn’t just a quirky “viral” video, but it’s also a fully functioning hard-hitting brand response television commercial as well! Later, it would run on television as well. Internet cool? Check. Hard-working sales generator? Check!! Stretches the media budget? Check!!! Generates lots of free media mentions, social shares and word-of-mouth? Check!!!!
The next action that got us all talking was when they started advertising on television – becoming one of the very few “e-commerce” start-ups to do so, and said that their ultimate goal was for HALF of their media to be paid and for half of their media to be earned!
And, finally, the sale to Unilever for that iconic number – a billion dollars, in cash no less!
Dollar Shave Club Us, Please! We suppose we’re not the only agency that is receiving that request these days, but we may be the only one that is 100% delighted. Because the main reason I’ve been writing, talking, podcasting and preaching about Dollar Shave Club these past four years is because this is exactly what we do for the excellent, disruptive, direct model, brand response, inspiring action marketers whom we are proud to call our clients.
If you too want to drive brand value up while driving cost-of-sales down, let’s talk.