The big consumer packaged goods brands are looking at direct to consumer subscription models. Here’s how the Wall Street Journal reported on Proctor & Gamble’s foray.
For decades, Procter & Gamble Co. has relied on retailers, from local groceries to giants, such as Wal-Mart Stores Inc. and Amazon.com Inc., to sell its razors, shampoo and diapers. Now the consumer-products company is looking for ways to cut out the middleman.
Blindsided by the success of the upstart Dollar Shave Club, an online subscription service that chipped away at the dominance of Gillette razors, P&G executives say they are focusing not only on what consumers buy but on how they buy.
Unilever PLC is now entering the fray by purchasing Dollar Shave Club, a deal announced late Tuesday night.
P&G is experimenting with steps such as one that it just launched in Atlanta called the Tide Wash Club, an online subscription service for the dissolvable Tide Pods capsules that are the company’s highest-priced laundry detergent. The company offers free shipping at regular intervals.
The WSJ goes on….
With the ventures, P&G is delving deeper into the business of connecting consumers directly with the products it makes, especially a new generation less loyal to the company’s big brands. Last year, P&G began promoting its Gillette Shave Club to compete with Dollar Shave Club and similar services.
Privately, P&G executives acknowledge the company was caught off guard by the success of Dollar Shave Club, which started in 2011 and says it now has 3.2 million subscribers. “It was probably on the radar but we weren’t necessarily having the right conversation around what might disrupt us,” said a person familiar with the company’s thinking.