How a $1 product brings in $240 million

You are familiar with Dollar Shave Club. Prior to being acquired for $1B in 2016, they produced $240M in sales annually.

 

How is it possible to make this much money off of a $1 product?

 

  1. The $1-dollar shave is an attention-grabbing, disruptive claim.

 

  1. There were three options available when you visited their website: $1/m, $6/m, and $9/m.

 

  1. Boom! Their $6 and $9 models accounted for 73% of their total sales.

 

Bonus: How does McDonald’s earn money from a $1 cheeseburger if it costs $1.91 to bring in just one customer?

They also include Coke and fries for an extra $1.14.

Finally, the fries and beverage account for 86% of the revenue.

 

Source: JacobMcMillen

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