Is being viral effective enough for Dollar Shave Club?

Introduced last year, Dollar Shave Club lends many forgetful men a hand shipping out blades every month for as low as $3 per month (including delivery) to make sure that every man gets his face clean. The first video of Dollar Shave Club “DollarShaveClub.com – Our Blades Are F***ing Great” gained 10.5 million views so far, winning Best-Out-of- Nowhere Video Campaign in 2012. And there is no doubt about it. According to Business Insider, advertisers need to bring out psychological responses – namely: emotions. They can be funny, warm, nostalgia, shocking, negative, and many more.

The first Dollar Shave Club’s video is hysterical. It embraces being funny, sarcastic, and honest. However, in spite of gaining 10.5 million views on YouTube, the company currently has 200,000 customers, which accounts for only 1.9% of total viewers. The bottom line is…? We can only guess because the company hasn’t revealed its total revenues just yet. But, considering how the company cuts out the middlemen from its supply chain, doesn’t use big celebrities in its communication, and relies on social media, the company has undoubtedly saved a huge sum of budget.

As we all know, more customer acquisition brings more revenues. Yet, we have to keep in mind that viral campaign is good at generating buzz and impressions. And within that impressions there could be intended and unintended target audience. If you have 10 million viewers, that’s great! But, it doesn’t mean that they will eventually become your customers. Some other kinds of marketing techniques like direct marketing and events may be needed to help gain more customers and generate more sales. Take Gillette W.A.L.S. campaign in 2009, for example. The campaign started by forming a group of women insisting men to shave. The campaign went viral on both social media and national media. And Gillette came in with shaving event and promotion. The result? The sales grew 500%.

About a week ago, Dollar Shave Club launched a video “Let’s Talk # 2” on YouTube, promoting its second product for men “One Wipes Charlie”. The video nearly has 1 million views. The product is available to add in the cart without committing to monthly subscription. We expect that the video will surely become popular again. But, will the viral nature of their marketing be effective enough to grow the business? We will have to wait and see.