Thursday, May 14, 2009

TOMS Shoes

A New Business Model: One for One

Imagine what your day would be like without shoes.

Three years ago while American traveler and entrepreneur, Blake Mycoskie, was on vacation in Argentina, he visited a village filled with children walking barefoot. Treading over broken glass and dirt these children were exposed to a litany of infections and discomforts.

Immediately compelled to solve this problem, Blake started a for-profit company, TOMS Shoes, where the mission statement is: For every pair you purchase, TOMS will give a pair of shoes to a child in need. One for One.

“When Blake told people of his idea to start a business basically giving away shoes, people laughed and said that was ridiculous,” says a TOMS employee.

His aim is to create a business that sustains the ability to give, unlike a charity, which depends solely on donations. Because the story behind the shoes is so powerful, it serves as a word-of-mouth marketing tool. Not paying for advertising is what enables the “One for One” business model to work.

TOMS is thriving despite the current global financial crisis. “Sales were three times higher this past month [March 2009] than they were during the same month last year [March 2008]. I don’t think any other shoe company can say the same,” said Mycoskie at a CGI U conference hosted by ex-President, Bill Clinton.

TOMS has given away 150,000 pairs of shoes to date and there are at least a billion more to go.

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