Final answer:
Dollar Shave Club's competitive advantage over Gillette is based on creating economic value through lower prices, convenience, and a direct-to-consumer subscription model, leading to stable revenue and a strong brand presence.
Step-by-step explanation:
To analyze the competitive advantage of Dollar Shave Club (DSC) over Gillette, we can use the Economic Value Creation approach. DSC's competitive advantage lies in its direct-to-consumer business model which eliminates the middleman, allowing for lower prices and convenience. DSC subscribes customers to a monthly service, making shaving supplies affordable and convenient. By cutting out the retail markup, DSC can offer competitive pricing while maintaining quality in their blades and shaving products, in turn creating significant economic value for customers.
Additionally, the brand's marketing strategy is highly customer-centric, focusing on humor and relatability, which has enabled them to build a strong brand presence and loyalty. The subscription model also provides stable recurring revenue for DSC, a financial advantage that adds to shareholder value over time. This combination of lower cost, convenience, and a strong brand has given DSC a notable edge in the market.