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TOMS Shoes: Expanding Its Successful
One For One Business Model
Overview
TOMS Shoes was founded on the premise of the “One for One” Pledge, a promise to donate a pair of shoes
to a child in need for every pair sold in an effort to promote greater social equality. As a relatively new and
privately held company, TOMS experienced consistent and rapid growth despite the global recession that
began in 2007. By mid-2018, TOMS had given away over 75 million pairs of shoes in over 70 different countries.
As a relatively new and privately-held company, TOMS experienced consistent and rapid growth despite
the global recession that began in 2009. By 2015, TOMS had matured into an organization with nearly 500
employees and almost $400 million in revenues. TOMS shoes could be found in several major retail stores
such as Nordstrom, Bloomingdale’s, and Urban Outfitters. In addition to providing shoes for underprivileged
children, TOMS also expanded its mission to include restoring vision to those with curable sight-related illnesses
by developing a new line of eyewear products. They began selling other products to help provide clean water and
safe birth services where the needs existed.
Suggestions for Using the Case
The TOMS case is a case that is certain to capture the interest of your students and provide for a lively discussion
of the company’s commitment to operating in a socially responsible manner and its differentiation strategy in
the footwear industry. The case was developed to illustrate such Chapter 9 concepts as corporate philanthropy,
corporate social responsibility, and triple bottom line performance and competitive strategy concepts presented
in Chapters 2 and 5. The case will allow the instructor to introduce the business case for socially responsible
behavior and explore the different dimensions in developing a comprehensive corporate social responsibility
strategy and its competitive advantage potential. Students will likely express admiration for the company and
commend it on its social mission and its triple bottom line performance.
To facilitate your use of assignment questions and making them available to students, we have posted a file
of the Assignment Questions contained in the instructor resources section of the Connect Library for the
22nd Edition
In our experience, it is quite difficult to have an insightful and constructive class discussion of an assigned case
unless students have conscientiously have made use of pertinent core concepts and analytical tools in preparing
substantive answers to a set of well-conceived study questions before they come to class. In our classes, we
case 9 teaching note
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Utilizing the Guide to Case Analysis. If this is your first assigned case, you may find it beneficial to have
class members read the Guide to Case Analysis that is posted in the instructor resources section of the Connect
Library. The content of this Guide is particularly helpful to students if your course is their first experience with
cases and they are unsure about the mechanics of how to prepare a case for class discussion, oral presentation,
or written analysis.
Suggested Assignment Questions for an Oral Team Presentation or Written Case Analysis You
will find that the TOMS Shoes case is quite suitable for written assignments and/or oral team presentations.
Three good assignment questions are:
■ Top executives at TOMS Shoes, having heard of your growing prowess in strategic thinking and strategic
analysis, have employed you as a consultant and asked you to assess the company’s social responsibility
strategy and recommend a set of actions to help ensure that the company continues to achieve attractive
■ (Short written case assignment) What are the pros and cons of TOMS Shoes’ corporate responsibility
strategy? What evidence indicates that the strategy has produced positive benefits in the marketplace for
TOMS Shoes? What are your recommendations to strengthen the company’s commitment to corporate
social responsibility?
Assignment Questions
1. What are the key elements of TOMS shoes’ competitive strategy? Is the strategy best described as low cost,
differentiation, or best cost? Has the company focused on a niche or chosen to pursue the broader footwear
market? Explain.
2. In what ways does TOMS exercise its commitment to corporate social responsibility?
3. How does TOMS’ dedication to corporate social responsibility contribute to its competitive advantage?
4. What is TOMS Shoes situation like? What are its internal strengths and weaknesses? Its external opportunities
and threats?
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Teaching Outline and Analysis
1. What are the key elements of TOMS Shoes’ competitive strategy? Is the strategy best
described as low cost, dierentiation, or best cost? Has the company focused on a niche or
chosen to pursue the broader footwear market? Explain.
TOMSs competitive strategy includes brand loyalty, social responsibility and trendy styles that can be worn
by all age groups. What stands out the most for TOMS is their dedication to the cause that started TOMS
shoes. When shopping for a pair of shoes, a consumer usually looks for different features that a pair of shoe
2. In what ways does TOMS exercise its commitment to corporate social responsibility?
Students are likely to comment that much of TOMS’ CSR strategy centers on its “One for One” Pledge
where TOMS is committed to donating a pair of shoes to a child in need for every retail pair sold. Through
increasing access to shoes, TOMS seeks to remedy global poverty by improving underprivileged children’s
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3. How does TOMS’ dedication to corporate social responsibility contribute to its competitive
advantage?
One of the most important reasons TOMS has been so successful is because its customers realize that they
are buying into a cause, not just a product. As TOMS’ customers become vested in the TOMS cause, buyer
patronage increases as the number of repeat-buyers and general enthusiasm rises. TOMS then translates this
increased customer commitment and enthusiasm into successful social media advertising campaigns that
4. What is TOMS Shoes situation like? What are its internal strengths and weaknesses? Its
external opportunities and threats?
TOMs internal strength includes distinct and established brand name, trendy and upcoming new styles,
colors and designs also available with different college logos, reasonably priced to cater to a broad market
Internal Strengths and Competitive Capabilities
• Distinct and established brand name
• Trendy and upcoming new styles, colors and designs
Internal Weaknesses and Competitive Liabilities
External Market Opportunities
External Threats to the Company’s Well-Being
• Not as many new and upcoming styles as competitors
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5. What evidence suggests whether TOMS Shoes’ strategy is working? Does it have a
competitive advantage? Is its financial performance improving or declining?
6. What strategic issues should TOMS Shoes management and investors be most concerned
with? Are there possible improvements to its competitive strategy? Are there internal
weaknesses or external threats to its well-being that must be addressed?
At this point, much praise has been given to TOMS shoes. Yet the instructor should also ask students to think
critically about TOMS shoes and identify areas that TOMS could improve on.
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Epilogue