The direct-to-consumer market is a rapidly growing entity. The benefit of having such a close and deliberate relationship with the customers they’re providing goods and services for has proven to be an advantage to companies. Unilever, a consumer goods company based in the United Kingdom, recently acquired the Dollar Shave Club for reportedly $1 billion USD. The DSC has established itself as a direct-to-consumer giant, shipping detachable razor heads for a re-usable razor handle customized to the consumer’s needs.
This acquisition is an indication of disruption of the traditional retail market. Phillippe Loeb, the Vice President of Consumer Packaged Goods here at Dassault Systèmes, says “it also shows how much brand manufacturers value direct contact with consumers – it displaces it competitors with better experiences and crosses touch points.” It’s also a telling point about the future of vertical integration and the desire for companies to fully control the consumer experience, essentially “blurring the lines between brands and retailers.”
We see constant examples of consumer goods manufacturers and retailers embracing the idea of “the experience economy,” where superior products are only one part of the formula for success. The huge success of the Dollar Shave Club was a noteworthy example, but this acquisition by one of the largest consumer goods companies in the world shows that the “traditional” companies are taking notice and planning for the future.
