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Billion Dollar Shave Club

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The European consumer goods corporation Unilever has purchased shave delivery start-up Dollar Shave Club for $1 billion, as reported in the New York Times. Unilever announced the all-cash purchase late Tuesday night.

Dollar Shave Club is one of the most successful players in the emerging digital commerce market. First gaining popularity in 2011 thanks to founder Michael Dubin’s comedic YouTube marketing campaign, the company lured in customers by saving the costs of shelving at brick and mortar stores and sending blades directly to the consumer.

Today, Dollar Shave Club competes with newcomers like Harry’s and Bevel in the digital shave commerce space, in addition to traditional razor companies Gillette and Schick.  According to Unilever’s purchase announcement, the startup’s total sales reached $152 million last year.

Unilever’s own products – from Vaseline to Hellman’s mayonnaise to Axe body spray – have dominated grocery and drugstore shelves for years, but the company worries that digital giants like Amazon could threaten their position in traditional retail.

The acquisition of Dollar Shave Club means big things for the digital commerce world, which has been suffering a bit of a lag recently. Subscription delivery services have become a dime a dozen in Silicon Valley, causing investors to grow weary, but a major buyout like this could reignite confidence that these companies can yield big profits.

Read more at the New York Times.

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