Razwar.com, a business model with a split personality disorder

Nick De MeyUncategorized19 Comments

Dear Raz*War, dear David, you lost a customer. Me. Don’t get me wrong, I’m one of your biggest fans. I don’t think I talked more about one start-up in our innovation masterclasses than yours. You launched ‘Shaving as a service’. A subscription service on razor blades. It was the perfect business model example to explain people how you could revolt within a saturated industry. Basic product, smart idea. When you launched you attacked (yes, it was a War) the big giants in the market. *David* vs Goliath, awesome story!

Years ago when you pitched your start-up on stage you pinpointed exactly what was (is) wrong with the shaving industry.

  • “You don’t need million blades to have a good shave.” You, the bearded CEO, showed Youtube movies like this that you can shave with just 2 bladed razor. Low budget, start-up style but convincing!
  • “You’re paying too much for your blades!” Packed in sealed boxes or stored behind the counter… customers are always confronted with the fact that your Gilette Mach 9 Sword Titanium Turbo Glide is costing you a limb. “Stop doing that!”
  • “Don’t waste time looking for what blade fits which handle.” Yes, I hate that, very frustrating!
  • “It’s time to Revolt, it’s time for a War! Join Raz*War – Hell yeah! I’m in!

So I joined the movement and a few days later I got the first delivery of my neatly designed pack of razor blades. #proud

Yesterday, after being a member for 2 years, I went back to supermarket and the bought the cheapest Wilkinson Sword blades that fitted my dusted handle. You lost me.

But before I go, let me give you some feedback.

1. Subscription as a service?

That story is over it seems. Today, you’re just selling 40 blades for 1 fixed price (€42,60), shipped in 1 delivery. Is this a subscription or a plan? No! But more important, this is not an impulsive buying decision anymore. +40 euro? How many A-brand blades can you buy with that? As customer you start to think. (hint: That is not what you want.)

2. Dropping monthly or quarterly deliveries

You miss crucial moments to get in touch with your clients. Hey, I even mailed your team this suggestion last year. > “Mail people 2 weeks in advance, ask them if they want something extra with their next delivery. I’m confident it will boost your upselling. A gift for a friend, an accessory,… even with an extra discount (or no extra shipping costs).

Good luck with the business”

Instead you canceled all deliveries except one. Pity. Shipments cost a buck and are a burden (I know, we’re shipping brainstorm kits world wide) but you could do so much more with this! Why didn’t you go all in and set up a monthly recurring income stream. Get in touch with your client every few weeks. Build up a relationship! For me, this client base would be the strongest asset you would have in your business model.

3. 5 blades? Seriously?

I really loved the proposition of Raz*War. No frills, just awesome blades that shave. Nothing more, nothing less. Last year Raz*War introduced a 4 blade Razor that felt already as a stretch on your business proposition. But 5? “Customers asked for more blades.” I could refer to Jobs or Ford with cliché innovation quotes but services that trie to fit every customer segment will end up with a mediocre business. I’m not sure if this is what you want. Pick a side a hold on to your vision!

Kindle vs iPad vs Sony Tablet S

By raising your prices (at least the perception of it), dropping the subscription service and by joining the race for to the 10 blade razor you’ve put yourself in a different market: The same old market of Giants you were fighting against. Within this field you’re not the strongest. People that prefer high end are willing to pay for superb quality. You were the Kindle versus iPad. Two players, different markets. But today, you’re the Sony Tablet S…

Ps: What do you think about the The DollarShaveClub.com?
Although I’ve no intel if your business is burning. David, you’re a smart business guy so you probably know how to run this business but I hope you can pivot once more.

Today I stumbled upon The Dollar Shave Club. What do you think? It’s Raz*War with a twist: a Shaving business cocktail mixed with flavors of Old Spice and Kenny Powers K-Swiss Blades. But on the other side, even they have a 6 blade razor (six!).

David, Good luck with your projects. I’m looking forward to your feedback.

(source: TechCocktail)

  • http://twitter.com/pekesenertjes Pekes en Ertjes

    had same thoughts this morning after seeing DollarShaveClub.com

  • http://www.facebook.com/davidhachez David Hachez

    Hello Nick. I am very touched by your article. You know I value customer’s opinion. I am unable to comment publicly but … I am still David and I still want to beat Goliath. Now, the question is : how? Let’s be patient and we’ll try to find a pivot.
    The only thing I can say thought is that building a business is more than a good idea; it is about the means (in the case of DSC > they raised 1M $) and the focus dedicated to it BUT above all it is a people story. I will be glad to write a book one day about people and business but i will not start the first chapter here ;-)
    I hope to see you soon.

    Best regards,

    David

  • http://twitter.com/Moorke Michel Demoor

    The article is leaving me with the feeling DSC is suddenly successful because they have a hero viral running around our walls and newsfeed. It’s assuming Razwar should have kept their initial offering.

    Can’t agree. For 2 reasons.

    (one) DSC is not successful. They’re burning (1M) dollars on an exact copy of Razwar 2009. My point: they didn’t prove the ShaaS business model is working, yet.

    And (two) Razwar understands the market a lot more than DSC does. We should not underestimate commitment. My point: David has made Razwar evolve based on his experience and insights.

    I believe in the people behind a company, their discipline, their interpretation of the business model and the patience to pivot it day by day. Even if it doesn’t fit the dream model no more.

    Go ahead Razwar, go with your instinct.

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  • Bert Cattoor

    Judo economics…
    I like your puppy dog idea, I’d say. Never heard of it before, is there a way you could create more buzz? Or is it just me?

    I, for one, used to be annoyed by the razor blade scam, but now I use a straight razor. Yes, the ultimate one blade razor with honing belt. Not for the faint of heart or when you’re in a hurry, though.

  • Wannesss

    Few months ago I was interested in going for a Razwar subscription.
    Few things stopped me:
    1) It is indeed no longer a subscription just a load of blades
    2) One can buy the same blades as razwars in Aldi, for far less.

    It was a no brainer for me. I now have razwar/aldi blades.

  • Anonymous

    You are right in what you say about DSC versus RazWar. RazWar do understand much more the market that DSC do. Despite its strengths (we love their website), DSC is only selling a service, maybe a shaving service (with a brand) but not a shaving brand. All the shaving guru’s & experts who follow us recognize that; we succeed to create a (yet very small) original and modern shaving brand in the wetshaving market, combining razors and a cosmetic range, in a coherent and credible way. Going back to the theme of this blog: this is also about innovation: listening to consumer needs and adapt.

  • Anonymous

    Dear All, Just as a conclusion or my contribution to this dialog: Going back to the theme of this blog, which is about innovation, I would like to say that Innovation is also a matter of tenacity & enthusiasm. (Something I brought to the 3 companies I created, with partners).

    Thank you your comments and for this discussion and…let’s s(h)ave the world!

  • Anonymous

    (4th attempt to drop a comment, just understood now on going to DISQUS Q&A that you should not put hyperlinks in comments if you do not want content to be deleted) Dear Nick, Dear Philippe, Thank you for your article. Your are so true! Yes, indeed, RazWar showed some signs of “split personality disorder”. But, at the difference of split personality disorders for individuals, this company pathology can be cured. And the condition for cure is auto-reflexivity (the capacity to accept and work on your own subject). The only thing I ask is some patience and the right to make mistakes.

    When I had the idea of RazWar, back in 2008 (When I look for partners and met David Hachez), I knew from the beginning that the service of delivering razor blades to the door of the consumer will not be enough. I wanted to create a true shaving brand, with a message to convey to consumers / a story to tell. I wanted to apply to myself the services we were selling to others clients: Customer Relation Management. Hence, RazWar was namely a brand about storytelling and CRM.

    From the beginning, I wanted RazWar to be associated, even lightly, with Citobi, to leverage Citobi’s immense experience about building relationship with consumers and to create customer fidelization. Unfortunately, despite being the idea generator, the founder and the main shareholder (having invested personally and through my holding GrowthFinancial, I was not allowed to do that. For what reason? I don’t know. Maybe for that “split of personality” disorder you mentioned.

    But lest’ go back to what seduced you in RazWar. You was interested in the true SaaS aspect of the brand. The Shaving as a Service. It is still around and I, as founder, would like to come back to the subscription as a service mode. Just allow the team a little more time to fall back on its feet. What is sure is that I wanted to build a continuous relationship with our consumers, and that this needed to be build trough monthly or quarterly deliveries, together with some content to bring along to the consumer.

    Now about the 5 blades story, as you , I strongly believed, since the beginning, that 5 blades was 4 blades too much. Hence, it was even among the beliefs that triggered the RazWar idea in my head. But, then, I made a series of test. Before looking for partners, when my spouse and me were alone, I tested, re-tested and re-re-tested different 2, 3, 4, 5 blades model. I even tested a 6 blade model! I was very astonished, but the 5th blade brings something. A little less than the 4th blade, etc. And the 6th blade brings nothing more (significantly). When you study razor patents (what I did), I came to the same result. Hence, we were wrong when believing that 5 blades had no sense. But we recognized that and we adapt our offering. The 5 blades model (http://www.razwar.com/collections/razor-blades/products/el-fidel-starter-kit) is now our best seller. We came to that conclusion partly thanks to our consumers. We listened to them.

    Now, I hope that we could overcome the “split personality disorder” that we faced and we could grow in harmony, building, with the help of Citobi, an original internet shaving brand.

  • Anonymous

    Yes, you are right about the economics (I also invite you to read this blog serie: http://razwar.posterous.com/the-maths-of-shaving-1). But straight razor is not obvious and take a lot of time. Hence, cartridges razor shaving is still among the most convenient way to shave. Yes, we need to take more buzz… We are patient. But help us spread the word!

  • Anonymous

    I do have a lot of respect with DSC. But, again, http://www.razwar.com wants to be much more than a DSC like (also, we were the first). The problem is that we did not launch in US. RazWar was launched on what P&G often calls “The most difficult market on earth” (Belgium) with limited amount of money. Hope we can keep your support! http://www.razwar.nl

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