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Monday, November 28, 2011

Strategic CSR - Toms Shoes

The article in the url below is a book review of an autobiography of Blake Mycoskie, the founder of Toms Shoes (http://www.toms.com/). Mycoskie’s innovation with Toms is the promise to donate one free pair of shoes to needy children for every pair of Toms shoes purchased (see also: http://online.wsj.com/article/SB10001424052702304252704575155903198032336.html). The autobiography is titled ‘Start Something That Matters’:

In 2006, Blake Mycoskie, a Tiggerish Texan bounded off to Argentina on holiday. … While in Argentina he came across a shoe called the alpargata, a kind of espadrille, and thought it would sell well in the United States. On the same trip, he met an American woman who was running a shoe drive, to deliver shoes to poor Argentine children. Twang went his entrepreneurial synapses: "Why not create a for-profit business to help provide shoes for these children? Why not come up with a solution that guaranteed a constant flow of shoes, not just whenever kind people were able to make a donation?"

Being The Wall Street Journal, the reviewer is skeptical of the “social entrepreneur” label Mycoskie uses throughout the book. The author’s skepticism generates a great point:

Though General Electric builds power plants and life-saving medical equipment and Exxon heats homes in winter and keeps the world moving with its fuel, they are decried as the villains of society, while the "social" entrepreneurs are venerated for giving us hemp shirts and organic greens. It has never seemed a fair distinction.

While recognizing the incontrovertible social value those firms have generated, Toms achievements are pretty impressive, too:

[In 2010] the company reported that, with the help of charities and other groups, its giveaways had passed the million-pair mark.

The advantage of a business model such as Toms (which now also includes eye glasses: http://www.toms.com/eyewear/), though, is that value is more likely to be added without the damage that the products of a traditional for-profit firm such as Exxon can also cause. The reviewer, ultimately, is also persuaded:

Having given away a million pairs of shoes—to children who, when barefoot, might be vulnerable to hookworm, tetanus and other soil-borne ailments—buys Mr. Mycoskie the credibility he needs. I finished the book not only wanting to buy a pair of Toms but also wanting to "start something that matters" myself.

The important insight worth building a business around?

People yearn to do meaningful work.