Why Dollar Shave Club invests in unscripted customer service
A potential Dollar Shave Club customer laid down an unusual challenge to the company on its Facebook page not long ago. In exchange for his pledge to order a one-month subscription of razors, an employee had to solve a Rubik’s Cube in two minutes or less.
The following afternoon, Dollar Shave Club posted a minute-and-25-second clip of a member service agent feverishly answering the challenge standing next to a framed sign of the company’s tag line, “Our Blades Are F***ing Great.”
The spontaneous response was applauded on Facebook. And it reinforced how the company wants to be viewed: cool, funny and willing to do almost anything to please a member.
It’s all part of the customer service strategy for Dollar Shave Club, a quickly growing Venice company with 2.2 million members known best for its viral commercials and wisecracking founder.
The company employs about three dozen member service agents who answer phones and emails, conduct online chats and reply to queries on social media — all while channeling the brand’s distinctly playful and irreverent tone.
The strategy isn’t easy. Training takes weeks. Finding the right personalities is challenging. It would be cheaper and less hassle to contract with a third-party customer service firm, which Dollar Shave Club does to complement its in-house team.
But online retailers, including pioneers Zappos and Bonobos, have found the investment in unscripted customer service worthwhile. The interactions, they say, feel more authentic and help humanize e-commerce brands that are, by their very nature, faceless.
Do it right and a company can even benefit from free buzz on social media. A handful of memorable Dollar Shave Club exchanges have been posted by members on Reddit and Twitter.
The approach is “high cost, difficult to execute, but the word of mouth” makes it worth it, said Sucharita Mulpuru-Kodali, an analyst at Forrester Research.
That’s imperative for leading online retailers like the Amazon-owned Zappos, which relies on repeat customers and word-of-mouth marketing to power its $2 billion in annual sales.
The Las Vegas seller of shoes and apparel has been at the forefront of unscripted customer relations and instills what it calls “WOW” service in its 600 agents through a seven-week training course. That results in some extreme cases of customer satisfaction, like the time an agent was compelled to visit a rival shoe store to fill an order Zappos couldn’t because it didn’t have the right size.
“It certainly would be cheaper” to contract out customer service, said Kelly Wolske, who trains Zappos’ customer loyalty team. “But it wouldn’t be better. Seventy-five percent of sales come from return customers, so it’s important for us to control the customer experience as much as possible.”
A similar approach is taken by online clothing retailer Bonobos, which employs a team of 40 customer service “ninjas,” who are encouraged to be playful and spontaneous with customers. Many are recent college grads, aspiring comedians and actors.
“Rather than looking at customer service as an expense, we see it as a fundamental investment, just as we invest in the design and quality of our clothing product,” said Melissa Baird, vice president of operations and product for Bonobos.
Customer service is a regular budget item for Dollar Shave Club, which has raised $148 million from investors, but has yet to make a profit since its founding in 2012. The company recently moved into a new headquarters and is projected to post over $140 million in revenue this year.
Company leaders say the time a customer service representative speaks to members is the only chance to pamper them and make them feel like they belong to an exclusive club. Agents are allotted a budget to send gifts — like the “Godfather” DVD box set sent to the member who joked that being in Dollar Shave Club was like being in the “family.”
When another customer complained of the difficulty shaving her legs because she was pregnant with twins and couldn’t see her toes, a customer service agent mailed a free pedicure set and a collection of baby books.
“They put a lot of trust in us,” said Jackie Resnick, a 23-year-old member service team member. “And you can’t mess up. Once you put it on the Internet, it’s out there forever.”
Indeed, one interaction posted on Reddit included a member service agent playing along with a customer who joked that an ancient order of clean shaven monks had stolen his shipment.
Another member tweeted an exchange in which a Dollar Shave Club representative wouldn’t confirm or deny he was a well-programmed customer service bot.
“We have taken great pains to develop this brand experience,” said Michael Dubin, chief executive of Dollar Shave Club, which provides members with a subscription of razor blades that costs $3 to $9 a month.
“There have always been places to buy razors on the Internet; we’re not the first and not the last,” he added. “What we’re doing very different from everybody else is building a lifestyle brand.”
The approach appears to be paying off.
Dollar Shave Club has doubled its membership in less than 10 months and says it owns 16% of the U.S. cartridge market by volume, which places it just ahead of Schick as the nation’s second-biggest brand.
“If it goes down the drain in the bathroom, Dollar Shave Club thinks it has a statement to make on it,” Dubin said.
As for online razor sales, Dollar Shave Club commands nearly 50% market share, according to Slice Intelligence.
The company’s second-closest rival online, Gillette Shave Club, which was introduced last year partly in response to Dollar Shave Club’s success, owns about 18% of the online razor blade market.
“Dollar Shave Club is setting the pace,” said Ken Cassar, vice president of analytics at Slice Intelligence. “It’s a company that’s defining and riding the wave of growth in subscription services.”
The brand’s original commercial consisted of Dubin, who has a background in improvisational comedy, walking through the company’s warehouse explaining outlandishly how Dollar Shave Club works. It cost $4,500 to make and has garnered over 20 million views on YouTube.
The ad, for all its quirkiness, had an unintended consequence. Members started asking customer service agents to tell jokes. Job applicants started sending poems with their resumes. One even sent a cover letter boasting of work experience that was “f***ing great.”
Logan Stein was a fan of Dollar Shave Club’s commercials before he joined the start-up. The former Hulu employee who mans Dollar Shave Club’s online chats and email account is a part-time magician and improv comedian, which he made sure to mention in his cover letter.
Stein, 26, had to get used to some strange interactions with customers. One member, a cattle breeder from Attica, N.Y., wrote an email to recommend a new shaving product:
“After seeing most of your commercials,” the email said, “I think you’re probably the only people that may relate to what I’m going to suggest. Breeding lubrication.”
Stein sent the member a free tube of Dollar Shave Club’s shave butter.
“You never know what they’re going to type,” said Stein, dressed in typical office casual attire of jeans and Chuck Taylor sneakers. “I have to listen and respond. That’s all improv is.”