What does Unilever’s acquisition of Dollar Shave Club mean?
Procter & Gamble may be dipping its toe in the water when it comes to subscription services with its Tide Wash Club pilot, but Unilever is diving head first into the deep part of the pool with its announced acquisition of Dollar Shave Club for a reported $1 billion.
The deal between the two companies will keep Dollar Shave Club founder and chief executive Michael Dubin running the company as an independent business.
Dollar Shave Club came to prominence four years ago with irreverent online ads starring Mr. Dubin that poked fun at the high prices men had to pay for razors sold by P&G’s Gillette and rival, Schick. The spots quickly went viral and today the company is reported to have over three million subscribers while holding about a five percent share of the American shaving market.
A big part of Dollar Shave Club’s subscriber growth has come from its ability to mine its data to curate messages that keep members both entertained and engaged. Even with this, Dollar Shave Club is not yet profitable, according to experts. In recent years, Dollar Shave Club has expanded beyond razors to a number of personal grooming lines for men including Wanderer personal wash, Big Cloud skin care, Boogies hair styling and One Wipe Charlies daily wipes.
“Dollar Shave Club is an innovative and disruptive male grooming brand with incredibly deep connections to its diverse and highly engaged consumers,” said Kees Kruythoff, president of Unilever North America, in a statement. “In addition to its unique consumer and data insights, Dollar Shave Club is the category leader in its direct-to-consumer space. We plan to leverage the global strength of Unilever to support Dollar Shave Club in achieving its full potential in terms of offering and reach.”
The acquisition by Unilever is expected to help Dollar Shave Club take its subscription model to overseas markets.
- Unilever Acquires Dollar Shave Club – Unilever/Business Wire
- Unilever Buys Dollar Shave Club for $1 Billion – Fortune
- Why Unilever Really Bought Dollar Shave Club – Bloomberg
- Will consumers buy subscriptions to buy Tide from P&G? – RetailWire
DISCUSSION QUESTIONS: What does Unilever’s acquisition of Dollar Shave Club mean for retailers and CPG brands in the U.S. market? What do you expect Unilever and Dollar Shave Club to gain from their relationship?