The CEOs of shaving startup Harry's explain how they acquired a million customers in 2 years

Dollar Shave Club, with its reported two million members, may be the clear leader in the emerging men's razor subscription service market, but younger New York startup Harry's is catching up quickly; and it's doing it with far less spending on traditional advertising.

Since launching in March 2013, Harry's has focused on a selective and efficient influencer model as opposed to using their capital to catch as many eyeballs as possible.

Harry's says it has reached well over a million total online customers (defined as people who have purchased at least one item) and is approaching one million subscribers, while maintaining a 60% retention rate among customers who started receiving Harry's razors in the mail every month or every few months.

"The way we think about [marketing] is that we introduce the brand to people through a credible source," cofounder and co-CEO Jeff Raider said. "So the best form of advertising is you trying Harry's, liking it, and then you telling your friends about it. And that always has been, since the moment we launched."

When Raider and his cofounder and co-CEO Andy Katz-Mayfield were developing the company pre-launch in 2012, pharmacy brands like Gillette and Schick dominated the industry due to decades of brand awareness and trust, and Dollar Shave Club began slowly acquiring momentum since launching the previous year.

Dollar Shave Club was going the traditional disrupter path of offering a sufficient alternative to mainstays that was cheaper and more convenient. The company's added value, however, was only its service, since the razors it sells are manufactured by the brand Dorco and available elsewhere at a slightly lower price.

Harry's, with eight razor blades retailing for $15, would have prices comparable to Dollar Shave Club's premium offering but be of notably higher quality. Raider and Katz-Mayfield determined that the way to achieve this would be to become vertically integrated, manufacturing all of their own products rather than reselling others and owning all means of distribution.

The founders' outreach focus would be, and still is, "telling guys everywhere that there is finally an option that they can be proud of" that's "at a price they feel really good about."

As Raider explained in a 2014 guest post on author and investor Tim Ferriss' blog, their pre-launch strategy focused on building brand awareness through social media teasers that compelled viewers to register their emails for Harry's updates and get their friends to do the same through tiered rewards. If a person got 50 friends to sign up, he'd win a year of free shaving - more than 200 people reached that goal. On launch day, Harry's was able to send an announcement to each of the 100,000 emails it had collected in one week.

Additionally, Raider told Business Insider, Harry's team "sent the products to hundreds of people, ranging from family to friends to highly discerning grooming editors at major magazines. We wrote personal notes to each and were so excited to share the brand with them." For example, GQ's style editors enjoyed Harry's aesthetics and performance and wrote a positive review in their magazine, which drove sales.

Even Raider's guest post on Ferriss' blog, with a supportive introduction from Ferriss himself, was a strong source of traffic to Harry's site due to its personalized tone and seal of approval from Ferriss to his hundreds of thousands of loyal readers.

Over the past couple years, Harry's has been a regular podcast advertiser, but its marketing team tries to make partnerships that will sound as authentic as possible.

"When we think about working with a new media partner, we send the hosts products to try out," Raider said. "We feel that it's really important for them use our product. If both parties feel like it's a good fit, we will move forward with a sponsorship, and we ask them to organically describe their personal experience with Harry's on-air."

Harry's main advantage is that it can promote having superior products and good value due to its business model. It has raised a total of $287.1 million at a valuation of $750 million, and used more than $100 million of that to acquire a German razor factory last year. Raider and Katz-Mayfield said they are using their money to further develop the factory and improve their products while maintaining their affordable prices.

They think in the long term their strategy can continue to win customers from the big guys like Gillette and trump Dollar Shave Club's expensive advertising push.

"Our biggest challenge is just awareness," Raider said. "If you surveyed the whole US population, a very small percentage of people know that Harry's exists, what Harry's is and what it stands for. ... So I think as we get older as a business and a company and have more customers who tell more people about us, word spreads, and that's naturally led to acceleration of our growth, which has been exciting."