If Gillette was Apple and someone else decides to buy up Chinese-made tech gadgets, throw it into a USPS Priority box, give up margins as marketing, and create a quirky new brand would that also yield a similar result in 4 years?
Also, there must be quite a lot of ad agencies up and down Madison Ave laughing out loud because in their monthly pitch sessions to P&G they must have offered something similar to DSC on a silver platter for much less than a billion dollars.
Apple locks in its users far more than razor companies do. A Gilette customer can switch to DSC at basically no cost. They're buying razors regularly anyway, so they start saving money the moment they switch. The only question is how well the new razors actually work for the customer.
For an Apple customer switching to the Apple version of DSC, first they're probably dropping a significant chunk of money to switch. Yes, the Apple-DSC will be cheaper, but phones aren't a consumable product the way razors are, so there's also the possibility of just spending nothing and keeping your current Apple phone. Then if you do make the switch, you lose all your apps, you lose the ability to iMessage and FaceTime your friends, you lose easy access to your iCloud photos and notes, and more.
One big difference here is that if you decide to dump Apple, you can resell your overpriced iPhone on the used market to get a good portion of your money back. You can't do that with razors. The main problem with dumping your iPhone is, as you pointed out, all the software and online services you might be tied into. That's where most of the lock-in is. People who avoid all that crap are in a much better position because they can switch phones easily at any time.
If they did offer that to P&G, then P&G was right to reject it. P&G have nothing to gain from this as incumbents, they'd just be throwing money away. The article covers this, saying Unilever was only in a position to buy because they had no existing product in this area.
i agree. this way unilever is getting a foothold in another category in which they can undermine P&G's profits, even though in a bit by bit fashion. they will surely bundle DSC concept with existing personal care portfolio. on the contrary, p&g is galaxies far from hurting unilever's profit maker : ice cream business. still it is clear that gillette acquisition was the best thing p&g did in its his entire history. they wouldn't have survived profit-wise otherwise.
IMHO, DSC model (subscription based company directly owning supplier to consumer chain, offering nice price + convencience) is the way to disrupt incumbents in consumer goods even though they will never get as big or as strong. there are lots of products which we do not care which brand we purchase as long as a certain level of quality and on-time sufficient delivery is ensured. i would definitely subscribe to a service which analyzes my consumption and delivers all "non-critical" products to my home/work location.
Xiaomi basically does something pretty similar with regards to many consumer electronics categories, on a global basis. And in 5-10 years, i wouldn't be surprised to learn you could buy most electronics form them at grea value.
Xiaomi aspires to be an Apple knockoff but really will end up being a Muji knockoff. Exporting fast fashion and lifestyle goods will be more profitable than low cost tech.
Also, there must be quite a lot of ad agencies up and down Madison Ave laughing out loud because in their monthly pitch sessions to P&G they must have offered something similar to DSC on a silver platter for much less than a billion dollars.