The Razor and Blade business model offers the basic product at a discount or even for free. On the other hand, the additional products that customers require in order to use the basic product are expensive and thus account for the majority of revenue. This straightforward yet clever business logic describes the model, which is also referred to as the 'bait and hook' model. The pattern's central idea is to earn the customer's loyalty by lowering the barriers to purchasing the fundamental product. Once a customer purchases complementary products, revenue will begin to accrue. 
Razor and Blade requires accessories to cross-subsidize basic products. When accessories are frequently used, this business model can be extremely profitable. In other words, the company not only sells basic products, but also increases the company's potential revenue from future sales of complementary products. To fully exploit this opportunity, exit barriers must be implemented that prevent customers from purchasing complementary products from competitors. Patenting the complementary product or developing a strong brand are both common strategies. As Nespresso demonstrates, the Razor and Blade pattern is frequently used in conjunction with the Lock-in strategy.

When and how to apply Razor and Blade:

 Razor and Blade is a household name in the B2C space. However, in the future, we will see an increasing number of B2B firms utilizing it, particularly in the after-sales business, such as in the machinery industry. When combined with Lock-in effects, this pattern becomes extremely powerful. Companies already employ these patterns to safeguard their lucrative after-sales and spare-parts businesses from imitation. To capitalize on these business model patterns, it may be necessary to bolster your patenting and branding capabilities.
Well-known companies that use this pattern are Venus by Gilette and Amazon Kindle.