Tale of Two Subscription Services: Dollar Shave Club and HelloFlo
It's only natural to compare HelloFlo, the subscription feminine products business that burst on the scene in the past year with two mega-hit videos, to Dollar Shave Club. The latter made a similar entry in 2012 selling razors.
But besides funny, risqué videos and subscription e-commerce, the two are as different as Venus and Mars, including in one very key respect – their relationship with the established heavyweight in their respective categories, Procter & Gamble Co.
HelloFlo is a bootstrap startup financed by its founder, who's forged an alliance with P&G, even as venture-capital-backed Dollar Shave Club wages a war aimed at taking a big slice out of P&G's Gillette business.
So far, Dollar Shave has done pretty well. By the account of CEO Michael Dubin, Dollar Shave Club is on track to do $60 million in sales this year and has taken more than a 6% volume share of the U.S. razor cartridge market.
Then there's HelloFlo, in league with P&G and selling its category-leading Always and Tampax brands.
Founder Naama Bloom, a former American Express marketing executive behind the startup, funded her initial "The Camp Gyno" video for $6,000 in 2013 with the help of two creatives from BBDO -- Pete Marquis and Jamie McCelland. Then she convinced P&G to fund production of her second video released in June – "First Moon Party" – which aims to sell girls "period starter kits" with Always and Tampax products.
HelloFlo is trouncing Dollar Shave Club in YouTube views, drawing roughly double the views for its first two videos, including 26.4 million for the most recent, compared to just under 18 million for Dollar Shave Club's first two videos combined, both were released earlier.
But proving dollar sales aren't directly correlated to video views, HelloFlo is doing what Ms. Bloom describes as a substantial "six-figure" revenue at this point compared to eight figures for Dollar Shave Club.
"People want to compare us to Dollar Shave Club, and we're really not the same," Ms. Bloom said, adding that she's happy to grow more slowly with her own financial backing and some help from her friends, including the team from BBDO and P&G.
"I kept after them for a long time, and eventually I wore them down," Ms. Bloom said, of the P&G funding. Even so, Ms. Bloom put no paid media behind either video, unlike Dollar Shave Club, or for that matter P&G with its viral videos. That makes the 26.4 million YouTube views for "First Moon Party" look pretty good even alongside the 46.8 million for P&G's "Like a Girl" video for Always, released a week later.
Ms. Bloom could draw upon the YouTube subscriber base from "Camp Gyno," now at nearly 9 million views. And both got help from her membership in TheLi.St, an online network of 500 women in tech.
For P&G, funding the HelloFlo video is like other shopper-marketing partnerships it has with retailers. The alliance also potentially prevents yet another e-commerce subscription challenge to one of P&G's businesses. But that's not what it's about, said spokeswoman Velvet Gogol Bennett.
"Always was excited to partner with HelloFlo to help empower girls, and to help ease that first-period conversation between girls and their parents," she said. It's really an extension of education efforts the company has had for more than 30 years through school programs and its own BeingGirl.com website.
She added that a Wakefield Research survey found more than half of parents would rather talk about drugs than puberty with their daughters, and more than a quarter would rather talk about death. Now, of course, they can just show them the video.