Lessons from a big winner of the $1 billion paydays.
How would you like to make $1 billion selling low-cost shaving supplies like Dollar Shave Club? That’s what Michael Dubin did in 2016 when he sold it to Unilever. That was a massive price tag for his subscription service that sends out supplies to members for as little as $3 a month.
Clearly, the winner was Michael Dubin.
Unilever could have knocked off the Dollar Shave Club in a New York minute. How hard can it be to put together men’s shaving supplies? What they bought were 3.2 million members. They bought more customers.
So, what is the big deal here?
Dollar Shave Club was the first to swim in the blue ocean, offering a shaving club subscription. We all love getting stuff delivered, but shaving supplies? And this started back in 2011.
The average man shops at the local grocery or retail store to buy their shaving supplies. But along comes the Dollar Shave Club. Even the name was intriguing.
Yes, that was innovative. To put a spin on something as simple as shaving supplies on a subscription basis.
Now that Unilever owns them, you will find the Dollar Shave Club supplies in Target.
So, what’s the appeal to still have it delivered? Maybe it’s what they offer on their website. On their website, you can enter a quiz to determine what products are right for you. They add expected fun. Brilliant, very, very creative.
They aren’t without innovation, that’s for sure.
Because they’re using lead generation tactics to get you into their sales funnel— their email list. Yup, a shave club sales funnel. The same reason that Unilever bought them was for their members. And they continue to grow their email list.
Your email list is one of the most valuable assets a company will have. The list allows them to advertise without costly advertising.
Here are 7 indispensable game-changing nuggets for every business
1. It’s all about the customer, not the product. While the Dollar Shave Club is only dealing with low-profit products, they deliver a unique experience to the consumer. We love the experience of buying when it’s carefully thought out.
Let me tell you about shopping at some of my favorite stores and what you can learn from it. I love leather. The smell, the feel, and it’s just so durable. I also love shopping at the Coach Outlet store. In contrast, other outlet stores treat you like you’re at Walmart, but not the Coach store. You feel like you’re in an upscale store with great prices — for Coach that is.
Here’s the thing, when you purchase your bag, you can ask them for a bag from the back. You know, one that hasn’t been touched, hung on someone’s shoulder, zipper worked over, or spread open like a flower when the sun hits. And it comes inside a bag to protect it from your dusty closet.
The best part, as they are closing out your purchase, it’s carefully wrapped in tissue, put in a big paper Coach shopping bag, and the salesperson comes around the counter and personally hands you the bag… with a smile and thank you.
2. You will never win, catering to the majority. Just like my Coach story, the price point isn’t the most expensive handbag around. But they focus on a specific demographic — one where women are willing to spend $300+ for a handbag that they treasure. And treat their purses like an investment. This is the status symbol for the woman who wants to be known for her excellent taste.
3. People want the unusual. When shopping in a discount store, most people have a certain expectation. They don’t expect to be treated like they’re shopping in Bloomingdale’s. They know they’re getting a deal off the regular price but being treated with such care… truly unusual. Most discount stores throw your stuff in a plastic bag, and off you go.
4. People buy stories, not things. Dollar Shave Club, when It started, was a story to share with friends. Men could get something as simple as shaving supplies delivered to them. Men could have products recommended to them because they couldn’t figure it out for themselves.
I love going to the DollarShaveClub.com site because they’re innovative. Not long ago, they had a quiz to find out which fragrances worked best together. They believe that men are concerned that their shampoo scent might clash with their body wash and deodorant. That is a niche, my friends.
5. Money is the thing. In the retail world, bottom-line profit is essential. But so is the price. I’m not sure if the Dollar Shave Club is a sustainable business model since it’s built on low-profit margins. Make one misstep, and you’re in the ditch.
But the Coach Outlet is still making a bundle with their pricey handbags. And people buy based on the price. When you’re spoken about is a positive way, you provided your customer a wonderful experience, and you’ve added value… then you can ask for more money.
Offering your customer three options is ideal: the low, medium, and high price-point. Most of the time, people will pick the middle while a small percentage will take the high-ticket option because they can. If you don’t have a high-priced opportunity, you’re defiantly leaving money on the table.
6. Wealth is in the list. That’s the email list. Surprisingly now and again, people will say they think email is dead. It couldn’t be farther from the truth. When the economy went south recently because of the world pandemic, businesses with an email list could pivot. Those folks who didn’t bother to build their customer base with their emails were scrambling. The time to create your list is always… now.
Without exception, your business needs an email list. And you need to be emailing them regularly. That means at least weekly. It doesn’t matter if you get too many emails; your customers need to hear from you. How else do they know what you’re up to?
7. Create sustainable assets. Depending on our business model, your assets may vary. It could be your vendor relationships who will help you when you hit a speed bump, cash is low, and orders are still coming in. Or your staff who will be with you through thick or thin if you treat them right. Maybe your biggest customers love you because you have thanked them for their business referrals. The programs or systems you’ve put in place to save you from having to be there to turn and spin every plate to keep it all going.
These are the business essentials that make every business word of mouth worthy. If you need help putting your essentials together reach out to me for a business intensive where we walk through your marketing to figure how to level-up your bottom-line.
To your success!
Hi, I’m Linda James Bennett, I’m on a journey to publish every day for 365 days. It’s now day 8 with only 357 to go. I’m the founder of ShinyObjectMarketing.com helping entrepreneurs level up their business.