Dollar Shave Club is a company that promises to sell quality razors at low prices. The company was relatively unknown until mid-2012 when it uploaded an advertisement on Youtube that has since garnered over six million views and won “Best Out-of-Nowhere Video Campaign” at AdAge’s 2012 Viral Video Awards.
Warning – contains inappropriate language. Viewer discretion is advised.
What makes Dollar Shave Club unique (other than its emphasis on humour) is its business model. Customers can choose between three kinds of razors: The Humble Twin, The 4X, or The Executive, priced at $1, $6, and $9 respectively. A consumer’s first purchase will entitle them to a razor and several razor blades, all shipped for free (with the exception of the $1 package). Customers can subscribe for monthly packages of razor blades for their particular razor at the same above rates. Customers are also free to upgrade and downgrade, and if they choose to do so, they get another free razor. Subscriptions can be cancelled at any time.
All the above benefits and a low price-point have heavily influenced consumer buying decisions. At a price of $1 per razor, many consumers will not engage in a high amount of problem solving and are likely to buy on impulse.
There are always customers who are not satisfied with their orders, and such people experience post purchase cognitive dissonance, or buyer’s remorse, and may do some research to find out more information about the company or if other people have the similar product or service issues. After some research, one may discover that Dorco, another razor retailer, is one of the Club’s main suppliers. Customer’s can buy virtually the same razors from Dorco for an even lower price. It just goes to show the importance of information, or in Dollar Shave Club’s case, imperfect information.
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