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My feeling throughout reading the article is best summed up as "Y U mad bro?" He harps on an "anti-woke" razor company that tries to market themselves as an al

My feeling throughout reading the article is best summed up as "Y U mad bro?" He harps on an "anti-woke" razor company that tries to market themselves as an alternative to Gillette and Harry's — the big point is "they spend 800k/month on marketing, so it drives up the cost of the razors". Does he know how much Gillette spends (saved you a search: 600M/year)? How do they fund that I wonder? He cites a study that says contextual ads and targeted ads perform at about the same efficiency. Why is this remotely interesting? Ads are a liquid market. If one channel was much better than another, it would be arbitraged away. His stated thesis is this: > Targeted advertising is incredibly expensive, and incredibly lucrative – for the ad-tech platforms that sit between creative workers and media companies on one side, and audiences on the other It couldn't be more wrong. Ads are incredibly cheap. It's why you see so many of them. It's why little companies targeting narrow niches can afford to buy them.

cushychicken 4y ago
I suspect targeted ads are a part of the phenomenon the article is talking about. Since targeted ads got so cheap, tiny little businesses could buy super targeted social media ads for less money than they could selling their products wholesale at a store. Net result is that they can flood social media with targeted ads for some geoarbitraged thing that tiny startup found on AliExpress decided to sell DTC, and end run around consumer wholesaling and all rigamarole involved there. The barrier to entry for that is super low. All you really need to be good at then is matchmaking some real niche product you found on Alibaba to a real niche consumer need. Net result: lower prices, greater net profit for the company, tons of new entries to the game of social media enabled DTC.
- fxtentacle 4y ago
  Your argument breaks down as soon as there are economies of scale. Gillette can probably buy the same quality as Jeremy's at a better price, because they order larger bulk shipments. That means the new niche DTC companies will most likely be a worse value to consumers than the established big brands. Also, the article links to a study which found DTC to be 10% more expensive than traditional retail.
  - logifail 4y ago
    > That means the new niche DTC companies will most likely be a worse value to consumers than the established big brands Umm, I bought a no-name (but Gillette-compatible!) razor last week while travelling due to having left my usual kit at home. Having used the no-name one for a week, I can no longer see any reason to pay the extra for a razor brand ever again.
    - taeric 4y ago
      As someone that has not changed razor blades in 5ish years, I'll warn that you probably can't generalize how well a razor will work for all skin and hair types. I'm thankful that I don't have issues with mine, but I also don't recommend others change. Granted, I haven't looked at prices in a long time. I am mostly assuming not insane costs.
      - logifail 4y ago
        > Granted, I haven't looked at prices in a long time. I am mostly assuming not insane costs I'm not sure what "insane" would mean in this contect, but replacement blades for the no-name Gillette clone I bought are half the price of original Gillette ones. My week using the former showed that, for me at least, the performance of the latter really doesn't justify its price. YMMV.
        taeric 4y ago
        I haven't bought blades in 5 years; so I don't have a gauge. I was underlining the YMMV for folks. I remember back when I was a lurker. :)
  - cushychicken 4y ago
    Lol I made absolutely no argument about product quality. All I point out is the underlying reason for a glut in companies selling stuff through social media advertising.
  - scarab92 4y ago
- delta_p_delta_x 4y ago
  > flood social media with targeted ads for some geoarbitraged thing that tiny startup found on AliExpress decided to sell DTC This is a gem of a phrase. I'm going to use 'geoarbitrage' from now on. I live in a place full of this sort of nonsense, such as resold Clevo ODM notebooks, overly-cheap 'desktop projectors', overly-cheap TVs, water purifiers, and even air-conditioners. Oh, and the 'advertisers' are typically skimpily-dressed young women barely in university. I simply refuse to buy anything that isn't European, Korean, Taiwanese, or Japanese for home appliances and electronics. Brands like Miele, Bosch, Samsung, LG, Sony, Brother, Nikon, Philips, Smeg, Liebherr... They're usually up to 2-3x as expensive as the equivalent on AliExpress, but the quality and service is unbeatable.
  - mstipetic 4y ago
    I agree with the whole list except Samsung for appliances, I’ve had terrible experiences with them. I have a guy coming in for the 3rd time to fix my dishwasher - the first time he came in he found out the wrong chip was installed for this model
  - doubleg72 4y ago
    Funny, Kitchenaid and Wolf/Subzero are US made and most products I have owned from either are far superior to Japanese/Korean. For instance, my Samsun refrigerator is three years old now and has a poorly engineered ice maker that has been repaired twice, the light for freezer is now working intermittently, and the digital inverter with its obnoxious 10 year warranty sticker on the front of fridge is now is noisier than when it was brought into the house. I continue to use a kitchenaid dishwasher and microwave, 16 and 10 years old respectively, which still look and run amazing.
    - delta_p_delta_x 4y ago
      I never said anything at all about American brands; I simply don't get them where I live much (if at all). My LG refrigerator and dishwashers, Sharp microwave, and LG monitors + TV have all been working fairly well for several years. That being said, personally dislike American brands but only because they usually advertise and use USC units, which make them hard to wrangle in a purely SI country.
spamizbad 4y ago
> Does he know how much Gillette spends (saved you a search: 600M/year)? How do they fund that I wonder? Jeremy’s volume is probably a Gillette’s rounding error. A better question is what is their CAC and CLV - and Gillette’s are probably much better.
- LegitShady 4y ago
  I don't think Gillette is worried about market loss to Jeremy's razors. the question is if Jeremy's is a viable business with $800k/month in ad spend, and if they're acquiring customers faster than they're losing them. Before jeremy's there were other similar businesses with the same business model that weren't anti woke but advertised heavily online - dollar shave club, harry's, etc. They both have the same business model as Jeremy's. Dollar shave club was acquired by Unilever for $1 Billion and Harry's was acquired by Schick for $1.37 Billion. After being acquired both companies seem to have stopped advertising online anywhere near as heavily as they did before. I think Harry's started as a sort of charity buy one give one sort of company so it also had a social aspect to its promotion. It's clearly a space where there's room for competition and the possibility of getting acquired by a giant company who doesn't want to compete with you. If you have a built in audience of "anti woke" who will buy whatever dailywire sells them, you short circuit a lot of your risk and can focus on growth. The targeted ads at people more likely to be interested is just that, looking for growth. It doesn't mean its a bad business.
chasebank 4y ago
You’ve clearly never worked in direct response marketing. The cost of customer acquisition vs lifetime value of a customer is terrible compared to traditional retail. In 2007, you could print money. In 2023, you’re most likely barely breaking even buying digital ads. The OPs thesis is quite correct. I’ve been in the space for 14 years and have tens of millions, if not hundreds, in DR adspend across multiple platforms / industries.
- MichaelZuo 4y ago
  Nearly perfect competition does imply a profit margin near zero.
  - looping__lui 4y ago
    I don’t think this is a case of “nearly perfect competition driving prices down so nobody makes a profit” (e.g., you working for a social media company trying to argue how perfect competition this is ;-) ) - BUT potentially rather a case of “monopoly power of social media charging so much for customer acquisition that it drives profits to zero”; so rather a shift in profit from high prices from the manufacturers pocket to Zuck et als pockets…
    - xapata 4y ago
      It's an auction. The buyers are driving up prices until it's no longer profitable.
      - looping__lui 4y ago
        With only one seller ;-) That’s usually kind of what you call a monopoly. A bit like just a single entity selling oil and then arguing “oh this is a free market because we auction of the oil…”
        MichaelZuo 4y ago
        No? Alphabet, Facebook, Microsoft, Apple, Tencent, Alibaba, Baidu, Bytedance, Yandex each have more than 1% of digital ad spend marketshare, and none of them have 50% of total marketshare. They compete in many areas too. I think there are credible Indian competitors growing too.
anigbrowl 4y ago
My feeling throughout reading the article is best summed up as "Y U mad bro?" He harps on an "anti-woke" razor company Could be rewritten as 'U mad bro? Y no buy muh razors & own the libs'.
- k12sosse 4y ago
  Stubble doesn't care about feelings.

cushychicken 4y ago

I suspect targeted ads are a part of the phenomenon the article is talking about. Since targeted ads got so cheap, tiny little businesses could buy super targeted social media ads for less money than they could selling their products wholesale at a store. Net result is that they can flood social media with targeted ads for some geoarbitraged thing that tiny startup found on AliExpress decided to sell DTC, and end run around consumer wholesaling and all rigamarole involved there. The barrier to entry for that is super low. All you really need to be good at then is matchmaking some real niche product you found on Alibaba to a real niche consumer need. Net result: lower prices, greater net profit for the company, tons of new entries to the game of social media enabled DTC.

fxtentacle 4y ago
Your argument breaks down as soon as there are economies of scale. Gillette can probably buy the same quality as Jeremy's at a better price, because they order larger bulk shipments. That means the new niche DTC companies will most likely be a worse value to consumers than the established big brands. Also, the article links to a study which found DTC to be 10% more expensive than traditional retail.
- logifail 4y ago
  > That means the new niche DTC companies will most likely be a worse value to consumers than the established big brands Umm, I bought a no-name (but Gillette-compatible!) razor last week while travelling due to having left my usual kit at home. Having used the no-name one for a week, I can no longer see any reason to pay the extra for a razor brand ever again.
  - taeric 4y ago
    As someone that has not changed razor blades in 5ish years, I'll warn that you probably can't generalize how well a razor will work for all skin and hair types. I'm thankful that I don't have issues with mine, but I also don't recommend others change. Granted, I haven't looked at prices in a long time. I am mostly assuming not insane costs.
    - logifail 4y ago
      > Granted, I haven't looked at prices in a long time. I am mostly assuming not insane costs I'm not sure what "insane" would mean in this contect, but replacement blades for the no-name Gillette clone I bought are half the price of original Gillette ones. My week using the former showed that, for me at least, the performance of the latter really doesn't justify its price. YMMV.
      - taeric 4y ago
        I haven't bought blades in 5 years; so I don't have a gauge. I was underlining the YMMV for folks. I remember back when I was a lurker. :)
- cushychicken 4y ago
  Lol I made absolutely no argument about product quality. All I point out is the underlying reason for a glut in companies selling stuff through social media advertising.
- scarab92 4y ago
delta_p_delta_x 4y ago
> flood social media with targeted ads for some geoarbitraged thing that tiny startup found on AliExpress decided to sell DTC This is a gem of a phrase. I'm going to use 'geoarbitrage' from now on. I live in a place full of this sort of nonsense, such as resold Clevo ODM notebooks, overly-cheap 'desktop projectors', overly-cheap TVs, water purifiers, and even air-conditioners. Oh, and the 'advertisers' are typically skimpily-dressed young women barely in university. I simply refuse to buy anything that isn't European, Korean, Taiwanese, or Japanese for home appliances and electronics. Brands like Miele, Bosch, Samsung, LG, Sony, Brother, Nikon, Philips, Smeg, Liebherr... They're usually up to 2-3x as expensive as the equivalent on AliExpress, but the quality and service is unbeatable.
- mstipetic 4y ago
  I agree with the whole list except Samsung for appliances, I’ve had terrible experiences with them. I have a guy coming in for the 3rd time to fix my dishwasher - the first time he came in he found out the wrong chip was installed for this model
- doubleg72 4y ago
  Funny, Kitchenaid and Wolf/Subzero are US made and most products I have owned from either are far superior to Japanese/Korean. For instance, my Samsun refrigerator is three years old now and has a poorly engineered ice maker that has been repaired twice, the light for freezer is now working intermittently, and the digital inverter with its obnoxious 10 year warranty sticker on the front of fridge is now is noisier than when it was brought into the house. I continue to use a kitchenaid dishwasher and microwave, 16 and 10 years old respectively, which still look and run amazing.
  - delta_p_delta_x 4y ago
    I never said anything at all about American brands; I simply don't get them where I live much (if at all). My LG refrigerator and dishwashers, Sharp microwave, and LG monitors + TV have all been working fairly well for several years. That being said, personally dislike American brands but only because they usually advertise and use USC units, which make them hard to wrangle in a purely SI country.

spamizbad 4y ago

> Does he know how much Gillette spends (saved you a search: 600M/year)? How do they fund that I wonder? Jeremy’s volume is probably a Gillette’s rounding error. A better question is what is their CAC and CLV - and Gillette’s are probably much better.

LegitShady 4y ago
I don't think Gillette is worried about market loss to Jeremy's razors. the question is if Jeremy's is a viable business with $800k/month in ad spend, and if they're acquiring customers faster than they're losing them. Before jeremy's there were other similar businesses with the same business model that weren't anti woke but advertised heavily online - dollar shave club, harry's, etc. They both have the same business model as Jeremy's. Dollar shave club was acquired by Unilever for $1 Billion and Harry's was acquired by Schick for $1.37 Billion. After being acquired both companies seem to have stopped advertising online anywhere near as heavily as they did before. I think Harry's started as a sort of charity buy one give one sort of company so it also had a social aspect to its promotion. It's clearly a space where there's room for competition and the possibility of getting acquired by a giant company who doesn't want to compete with you. If you have a built in audience of "anti woke" who will buy whatever dailywire sells them, you short circuit a lot of your risk and can focus on growth. The targeted ads at people more likely to be interested is just that, looking for growth. It doesn't mean its a bad business.

chasebank 4y ago

You’ve clearly never worked in direct response marketing. The cost of customer acquisition vs lifetime value of a customer is terrible compared to traditional retail. In 2007, you could print money. In 2023, you’re most likely barely breaking even buying digital ads. The OPs thesis is quite correct. I’ve been in the space for 14 years and have tens of millions, if not hundreds, in DR adspend across multiple platforms / industries.

MichaelZuo 4y ago
Nearly perfect competition does imply a profit margin near zero.
- looping__lui 4y ago
  I don’t think this is a case of “nearly perfect competition driving prices down so nobody makes a profit” (e.g., you working for a social media company trying to argue how perfect competition this is ;-) ) - BUT potentially rather a case of “monopoly power of social media charging so much for customer acquisition that it drives profits to zero”; so rather a shift in profit from high prices from the manufacturers pocket to Zuck et als pockets…
  - xapata 4y ago
    It's an auction. The buyers are driving up prices until it's no longer profitable.
    - looping__lui 4y ago
      With only one seller ;-) That’s usually kind of what you call a monopoly. A bit like just a single entity selling oil and then arguing “oh this is a free market because we auction of the oil…”
      - MichaelZuo 4y ago
        No? Alphabet, Facebook, Microsoft, Apple, Tencent, Alibaba, Baidu, Bytedance, Yandex each have more than 1% of digital ad spend marketshare, and none of them have 50% of total marketshare. They compete in many areas too. I think there are credible Indian competitors growing too.

anigbrowl 4y ago

My feeling throughout reading the article is best summed up as "Y U mad bro?" He harps on an "anti-woke" razor company Could be rewritten as 'U mad bro? Y no buy muh razors & own the libs'.

k12sosse 4y ago
Stubble doesn't care about feelings.