Competition for Online Razor Business

1

Dollar Shave Club has carved out a nice market niche with its funny videos, low cost products, and strong brand recognition. The company has done quite well, building from zero to a multi-million dollar company. In one year, it has gone from advertising only via viral videos to an estimated $10 million brand advertising campaign on ESPN’s Rose Bowl. But Dollar Shave Club is no longer the only game in town online for razor sales.

Enter a new upstart: 800Razors. The company has an exclusive e-commerce deal for razors featuring Schick blades and projects it can capture 10% of the market in the next 10 years. While its current revenue is estimated at $1 million, there is definitely a market worth fighting for: annual sales are more than $1.8 billion in offline sales of razor cartridges. (Gillette controls 81% of the U.S. razor cartridge business; Schick has 17%.)

Which shave do you prefer? Compare the two companies and decide which approach and product line will win.

Group Activities and Discussion Questions:

  1. Review key aspects of developing a product positioning map, including determining the axis labels for positioning.
  2. Review 800razors products and Web site (www.800razors.com).  Compare this with Dollar Shave Club (www.dollarshaveclub.com).
  3. What other products and companies are competitors? Place those on the positioning map.
  4. Divide students into teams and have each team develop a positioning map for this product.
  5. Have each team draw their map on the board.
  6. Debrief exercise.

Source:  Ad Age Daily, 1/6/14

Leave a comment

Filed under Classroom Activities

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s