Tacky marketing. Sky-high prices. Inconvenient merchandising behind cashiers or locked up in aisles. These aspects characterize the typical razor blade purchasing process in drug stores. Harry’s co-founders, Jeff Raider and Andy Katz-Mayfield, have set out to improve the unsatisfying razor buying experience for men. Jeff, a co-founder of Warby Parker, hoped to disrupt the ~$3Bn razor blade market similar to how Warby Parker shook up the eyewear industry years earlier. Together, Jeff and Andy created Harry’s with the mission to conveniently provide customers with well-designed, high quality shaving products at reasonable prices.
Harry’s designs, produces and sells its own line of high-end shaving products. This vertical integration gives Harry’s complete control over its product, allowing them to successfully address the above frustrations associated with buying razors while keeping prices low.
Harry’s did away with the cheesy design and annoying packaging typically associated with razors. They carefully crafted their stylish shaving product line by combining contemporary ergonomics with minimalist design. Harry’s razor blades are made from high grade steel that is shaped into a precise and sharp angled blade that provides the best possible shave.
Harry’s offers two main razor designs: the Truman, their classic razor that comes in four colors, and the Winston, a more premium razor designed for a more precise shave. Harry’s also produces branded cleansers, moisturizing creams, lotions, shave gels, and shaving accessories (razor stands, travel bags). Products can be purchased a la carte or in sets. Harry’s narrow range of products also enables the company to keep prices low.
The founders searched the globe for the right razor manufacturing partner. Their quest led them to Feintechnik, a 93-yr old German razor blade manufacturer. Feintechnik was a strong partner for Harry’s given its vast experience producing razor blades, its flexibility in manufacturing both luxury and basic razor blades (allowing Harry’s to create the perfect blade that matched their desired price point), and Feintechnik’s existing relationships with European distributors. After partnering with Feintechnik for a few months, Harry’s purchased the German factory for $122.5mm in January 2014 with proceeds raised from a recent funding round. Harry’s factory in Germany currently employs 450 engineers, designers, and other workers that produces millions of blades a year.
By owning the Feintechnik factory, Harry’s has end-to-end ownership over its production and supply chain systems. This vertical integration gives Harry’s a long-lasting competitive edge, as it differentiates the company from similar players that sell subscription sets of razors and blades at discounted prices online. In addition, owning the manufacturing process enables Harry’s to efficiently iterate on its product design and construction. Further, this product control enables Harry’s to more successfully battle current razor blade market leaders, Gillette and Shtick, who together control more about 85% of the world’s razors.
Factory Tour: https://www.youtube.com/watch?v=gMUg2o95ZrA
Distribution and Pricing
Harry’s products are largely sold directly to customers through its owned and operated e-commerce site and mobile app. Customers can also purchase Harry’s products at the company’s brand-named barbershop/showroom in NYC. This mostly online strategy gives Harry’s the flexibility to sell its products at affordable prices by removing the friction costs associated with distributors and retailers. Harry’s sells blades for ~$2/blade, which is 50% cheaper than what leading competitors charge for their blades.
Harry’s adopted a subscription-based strategy to service customers in a hassle-free way. Customers subscribe to a shave plan (Harry’s provides a free trial box set) and specify their shaving frequency. After the trial box, Harry’s automatically sends a box of shaving supplies based on how often a customer shaves. Customers can cancel their shave plan at any time.
Subscription plans start at just $6/month. Harry’s offers shaving sets at different price points to serve a wide base of customers. A basic set includes a razor, 3 blades, blade case, and foaming shave gel and costs $15 – a steal compared to razors that competitor Gillette sells for ~$10-$15 (which typically only includes the razor and two blade refills).
The direct to consumer model enables Harry’s to leverage consumer purchasing data to provide a seamless shopping experience for its users. Harry’s uses consumer data to reach out to a customer when they’ve predicted he needs to replenish his blades. Further, access to consumer purchasing facilitates a more personalized experience for its customers.
Harry’s Giving Model
Harry’s also prioritizes social responsibility. The company donates 1% of its net revenue to City Year and other charitable organizations that help young adults achieve in education and beyond.