Edgewell Personal Care Co.’s (EPC) Schick razor brand has announced this week the launch of its own online shave club, right after Procter & Gamble Co.’s (PG) Gillette did the same this month in efforts to step up its game against Unilever’s (UL) Dollar Shave Club. (See also: Close Shave! Disruption Nicks P&G’s Gillette Unit.)
Schick, the No. 2 razor brand in America, says its online subscription service will sell blades that fit on Gillette handles but at a fraction of the cost. The news comes as another blow to Gillette’s business, which saw its U.S. market share slip from 70% in 2011 to 54% in 2016, according to Euromonitor.
Fight Over Shrinking Market
At the same time that the razor market shrinks due to Millennial’s growing taste for beards, P&G has struggled to compete with a wave of cheaper alternatives and new startup brands. In particular, Unilever’s Dollar Shave Club is very popular among Millennials, getting its big break with a viral video on YouTube featuring a giant teddy bear. In response to a tough razor market, P&G said it would slash Gillette prices by 12% and focus on lower-cost products.
Earlier this month, Gillette launched an on-demand subscription service allowing customers to text and receive products at their doors, hoping its new “ease of ordering” option will reel in busy, tech-savvy consumers.
Schick’s Crossover Play
Schick’s platform, SchickHydro.com, launches on Wednesday and will allow customers to sign up for shipments of Hydro Connect blades that work with Gillette’s Mach 3 and Fusion as well as Schick blades. The move comes a little late for the razor maker, as brands such as Dollar Shave Club and Harry’s have dominated the online service club business for the past several years. As Schick’s share of the men’s razor market has declined from 19% in 2011 to 15%, the firm says it needs to “provide something that’s unique.”
“It’s not a secret that the shave clubs have not made money, and we need to make money,” said Edgewell spokesman Chris Gough. Edgewell hopes to target the same weak point P&G saw in Dollar Shave Club’s model, pointing to an inflexible delivery plan that leaves many customers with a stockpile of blades. The company says Schick customers will be able to order as infrequently as once every nine months. (See also: Procter & Gamble to Cut Gillette Prices.)
Shares of Cincinnati-based P&G have gained 10% in the 12-month period, despite dropping off significantly after a disappointing quarterly earnings report in April. Edgewater stock has declined 8.9% over the most recent one-year period, while Unilever has rallied nearly 30% in the approximately three-month period following a failed $143 bid by Kraft Heinz Co. (KHC).