Edgewell has acquired Harris more not only on DTC news, but also on a wider range of business news, since it was announced last week. Here, we get the opinion of five industry experts on the meaning of the deal for the DTC brands, and why Edgewell decided to give up this huge sum, and what benefits might accrue to Harry.
Ronald Brut Junior, Managing Partner, Associate Boston "Obviously, the purchase was a win for the overall DTC but with some caveats … First, Edgewell really bought a DTC DNA, they could not succeed quickly enough on their own without an acquisition, there would be a lot of this." Secondly, Edgewell A leading player in the brand, Schick and Wilkinson, are more likely to become the world's third-class player than the real leaders, so there will be more third-tier companies looking for a DTC survivor. That partners are looking for exit now.Third, the return on investment was In the next round of Harry's investors is fine.Not great.I can have Harry's chance to get out sooner than expected, or to achieve increased marketing costs make such a partnership necessary.I think both … The bottom line is that for many brands Commercial DTC, the customer acquisition costs will rise, and will be re-alignment a lot, under investor pressure, in 2019. "
Alex Song, Founder and CEO, Innovation Section, Edgewell says they acquired a holding company in their acquisition of Hariz: "Dollar Shave and Harry were bought mainly because of their form factor and long-term relationship with underwriters." Razors are low-cost products in an industry with little investment in marks The value of this customer is high because of the very long subscription periods due to the renewal cycle of razor blades and profitable margins.
"Unilever and Edgewell acquired these DTC brand marks primarily for the customer relationships that they were able to create through the consumer brand and the narrative." Synergies that can be obtained mainly derive from the opportunity to expand product offerings by side – meaning there will be many Of the personal care items for other men that will be sold through the relationships that Harry has built with her clients.
"Harry's focus on turning his business into a holding company shows that he was already focusing on the evolution from high growth to profitability." Harry's initiative creates the opportunity for Edgewell to get Harry & Future Innovation Center for the Environment of Older Companies. "
Chris Perry, Vice President, Global Executive Education, Edge by Ascending, Argues that the acquisition paves the way for more potential partnerships for Hariz. He says: "Although Harry is an original brand, this strategic acquisition provides Edgewell with the potential for rapid growth worldwide. In the United States, gives them a more valuable partnership with Target, which has already brought Harry's and many direct brands to the consumer exclusively at the store – at the expense of some traditional brand leaders – to differentiate between a variety of them and in the experience of a shopper's shop. This partnership model with Target is a strong growth strategy that can be replicated in other markets, such as the UK, with major retailers.
"Another advantage of EdgeWell is a recent and very relevant case study of Unilever's acquisition by Unilever to take advantage of accelerated performance and integration."
David Jocin, Commercial Director, Cxense Harry's acquisition may still pose more problems for Edgwell on-line: "This is an incredibly strategic move from Edgewell, who already has Wilkinson Sword and Schick's shaving brands in their portfolio." Harry is an annoying brand that, together with Dollar Shave Club, has made nerve-racking giants nervous. Swallowing and burying Harry's brand as a means of silencing competition, but Harry's knowledge of subscription models, customer centricity, and impeccable customer experience through their brands of shaving is likely to capture and capitalize on their customers' valuable lives.
"The importance of being able to manage large amounts of data to improve the customer's journey will delay its head as Edgewell begins this massive change in a traditional, sales-oriented deal." Edgewell now needs to prove he can accelerate growth and build on Harry's success "There is an opportunity for them to take advantage of the relationship that Harry's customers connect to the brand by adding subscriptions to their business model."
Tom Rolf, Vice President, Europe, Middle East and Africa, Tapad Says the takeover will be driven by Edgwell's desire for more data. "The $ 1.37 billion (£ 1.04 billion) paid by Edgwell for Harry demonstrates the real value of direct consumer brands to the major FMCG companies, which traditionally rely on retailers to reach consumers – all in the data.
"Direct consumer brands have a unique relationship with their consumers, where traditional third-party vendors – in this case supermarkets and chemists – are struggling to replicate, because traditional retailers simply do not have first-party data owned by direct consumer brands , And thus may lack a deep understanding of their customers.
Edgewell has the opportunity to use Harry's wealth to first-party data not only to develop Harry's business mark, but also to use this data to develop its other products. "