While many organizations try to incorporate cause-related marketing into their business operations, TOMS Shoes takes the concept of philanthropy one step further. TOMS blends a for-profit business with a philanthropic component in what it terms the one for one model ® . For every pair of shoes sold, another pair is provided to a child in need. Recently, TOMS has also expanded into eyewear. For every pair of eyewear sold, a person with vision problems in developing countries receives surgery, prescription glasses, or medical treatment to help restore his or her sight. Unlike many nonprofits, TOMS’
for-profit business enables the company to support its philanthropic component, which keeps the company from having to solicit donations.
The idea for TOMS Shoes occurred after founder Blake Mycoskie witnessed the immense poverty in Argentinean villages, poverty so bad that many families could not afford to purchase shoes for their children. Recognizing the importance of shoes to health and education, Mycoskie decided to create a new business that would consist of two parts: TOMS Shoes, a for-profit business that would sell the shoes, and Friends of TOMS, the company’s nonprofit subsidiary that would distribute shoes to those in need.
For his original product, Mycoskie decided to adopt the alpargata shoe worn in Argentina. The alpargata is a slip-on shoe made from canvas or fabric with rubber soles. After a Los Angeles Times article featured Mycoskie’s new business, demand for the shoes exploded. Unfortunately for Mycoskie, he did not have enough shoes to fill the orders. Mycoskie was able to work out the product shortage, and today TOMS is a thriving business.
After distributing its one-millionth pair of shoes in 2010, TOMS began to consider other products that could be used in the one for one model. “When I thought about launching another product with the TOMS model, vision seemed the most obvious choice,” Blake Myscoskie explained. Because 80 percent of vision impairment in developing countries is preventable or curable, TOMS decided that for every pair of eyewear it sold, the company would provide treatment or prescription glasses for those in need. TOMS chose Nepal as the first country for which to apply its one for one model.

Questions for Discussion 1. Do you think TOMS is successful because of its unique products, or is it the firm’s approach to social responsibility?
2. How does TOMS manage its supply chain in order to ensure ethical and socially responsible conduct?
3. How does TOMS’ business model relate to the understanding of stakeholders and strategic philanthropy?