×

A hot Father's Day gift idea: A good shave

Dollar Shave Club and Harry's are on the cutting edge of men's grooming.

Dollar Shave Club
Source: Dollar Shave Club

As Father's Day approaches, it's only natural that men recognize their dads, and reflect on all the things—both big and small—that they've taught them. For many guys, shaving is on that list. After all, what little boy hasn't stood in the bathroom, watching with fascination as his dad undertakes this grooming ritual?

Yet, as much as shaving can be viewed as a memorable rite of passage, it's also a $2.9 billion-at-retail business that's attracting a number of clever upstarts. Companies, such as online darlings Dollar Shave Club and Harry's, see plenty of opportunity to give men more shaving options—and more grooming product choices. In the process, they're looking to shake up an industry long dominated by grocery and drug store brands Gillette and Schick. So whether your father handed you a can of Barbasol and a disposable razor, or schooled you in the fine art of applying shaving cream with a brush and using a straight blade, chances are there's a company out there for you.

Read MoreMeet the 2015 CNBC Disruptor 50 companies

First, a little background on why there's such growing interest in men's grooming habits. The young men just entering the workforce are part of the millennials, a generation that will surpass baby boomers in sheer number for the first time this year. These 20-somethings care about looking good and, unlike some of their older brethren, don't feel that their masculinity is somehow threatened by the use of facial moisturizers, eye creams, and hair gels. Says Margie Nanninga, a home and personal care analyst with research firm Mintel: "These younger men are invested in looking good and are much more accepting of using grooming products to achieve that."

In fact, while U.S. retail sales of razors and cartridges actually ticked down a bit last year, according to Mintel, sales of men's skin care products grew by 8.4 percent and men's hair care products increased sales by 5 percent.

All this spells opportunity for these newer companies that are looking to grab a piece of an industry now controlled by Gillette and Schick, which together account for roughly 75 percent of the U.S. men's shaving market, according to consumer research firm Euromonitor.

Dollar Shave Club (DSC) founder and CEO Michael Dubin started his Venice, California-based online subscription razor company in 2012 when he figured he wasn't the only man in America tired of spending a fortune on razors. "I wanted to offer guys a better alternative than going to the local drugstore where razors are locked behind a cabinet and blades are far too expensive," he says.

Read MoreOnline shaving start-up takes on the big blades

Dubin spent about $4,500 to make DSC's first YouTube video, and its hilarious approach to explaining the company—and Dubin's deadpan delivery—proved so popular with viewers that it crashed the company's site and caused an inventory shortage within six hours.

The booming men's grooming market

Today, DSC says it has roughly 2 million members and ships around 70 million cartridges a year. Customers can choose from three plans: the basic $1 a month subscription gets you a handle and five replaceable, two-blade cartridges. Plans running $6 and $9 a month offer fancier handles and 4- and 6-blade cartridges, respectively. The company did $65 million in sales last year and says revenues are projected to top $140 million this year.

Beyond razors, Dubin says his goal is to "own the men's bathroom." Earlier this year DSC launched Boogie's, a line of five hair care products and an online tool that helps men find just the right shampoo or gel for their hair type. One of the company's best-selling products is One Wipe Charlies, which, if you can't tell from the name, Dubin is happy to simply describe as a "butt wipe for men." So popular are these wipes that Dubin says people actually approach him in airports to tell him how much they love the product. "Too much information? Perhaps, but it's true," he says. "Those things are a life saver on the road."

Harry's, started by one of the founders of online eyewear company Warby Parker, also positions itself as a lower priced alternative to Gillette and Schick. But it aims to help men view shaving as a pleasurable ritual made better with quality products and clean designs. Its sleek, ergonomically correct handles, five-blade razors, and shaving creams are sold in kits directly to consumers and start at just $15.

Harry's Razors product
Harry's Razors | Facebook
Harry's Razors product
"If you shave seven days a week or once a week to trim your beard, we're here for you." -Andy Katz-Mayfield, Co-founder, Harry's

Unlike DSC, Harry's owns the factory where its blades are made—a German company that's been in the shaving products business for over 100 years—and controls R&D, shipping and everything in between. Harry's co-founder Andy Katz-Mayfield says this vertical integration allows the company to get direct feedback from customers and drive it into product development.

Read MoreWarby Parker co-founder takes on Gillette

For instance, when customers who shave in the shower said they preferred a handle with more texture for a better grip, Harry's was able to quickly retool its manufacturing process to meet the request. "That would have been very difficult to do, and taken a long time, if we didn't control the process from end to end," Katz-Mayfield says.

The company, based in New York City, says it has 1 million customers in the U.S. and Canada, the majority of which are repeat buyers. The New York City market is also home to Harry's Corner Shop, a throwback to the traditional neighborhood barbershop where guys can stop in for a haircut and a shave with experienced barbers and pick up some of Harry's shaving creams and after shave moisturizers. While there are no plans at the moment to open additional shops, Katz-Mayfield says he's happy with the role it plays in the company's portfolio. "The barbers are always booked out in advance and we think it's nice to have a physical presence compliment our online brand," he adds.

So with all these new shaving options available today, one has to wonder why the unshorn look is increasingly popular with men on TV, in sports, and even in the workplace. Is it sheer laziness? A habit left over from the "No Shave November" movement?

Katz-Mayfield thinks he knows the answer. When starting Harry's, he and his co-founder Jeff Raider, looked at research detailing facial hair trends over the past 100 years (yes, such research exists, he swears) and what they found is that, like all trends, men's facial hair simply comes in and out of fashion. Right now, the unshaven look is having its moment. None of this bothers him. "We take all comers," Katz-Mayfield says. "If you shave seven days a week or once a week to trim your beard, we're here for you."

By Susan Caminiti, special to CNBC.com