Introduction
TOMS is a footwear brand that is transforming the world with one shoe at a time. It is probably considered the most philanthropic brand on the earth within its past 10 years in operation (Atkinson, 2017). TOMSâ revolutionary one-for-one approach has developed the business model that has contributed to the profitable success and transformed the lives of millions globally for the better. The company currently has offered 60 million free shoes for underprivileged people in society, restored sight for many people, provided clean water, and secured safe birth services for several mothers each year (Cotton, 2019). This has seen the brand emerge to become the company favorite among responsible and eco-friendly shoppers.
Blake Mycoskie founded TOMS Shoes while traveling through Argentina in 2006 and is based in Los Angeles, California. While Vacationing in Argentina, he witnessed the challenges experienced by children without shoes and it motivated him to create a business for profit with giving at its core. He established that for each pair of shoes sold, a new pair of shoes to a kid in need (Key, 2022). The company is a footwear and lifestyle brand using business to enhance people’s lives. The TOMS Shoes rose to become a certified B Corp brand in 2018 (Cotton, 2019). The assessment entails the development of a structured marketing report on the TOMS brand as one of the B Corp brands.
Macro-Environment Audit
PESTLE Analysis
Political Factors
The footwear sector may take advantage of the current political scenario in the world, in which there is a process of using a free trade policy. In this case, the market determines the price of the market and the products supplied. The financial crisis emanating from the COVID-19 pandemic has negatively influenced the economies of the world compelling nations to relax their trade barriers. The relaxation of barriers is significant because the sector can expand to other nations (MBA Skool Team, 2021). It will increase the market base for TOMS Shoes and sales revenue because products are sold in various countries.
Economic Factors
Globalization efforts have contributed to an increased market for the sector. Nevertheless, the declining disposable income from diverse people has compelled them to opt for second hands shoes, mostly in the African continent. Typically, designer footwear is relatively more expensive than other items (Market Research Company, 2022). Further, the increases in the unemployment rate and recessions have affected the industry.
Socio-cultural Factors
Awareness of customers’ need to have shoes on the list of their basic needs has resulted in a ready market for the footwear sector. People are ready to live better lifestyles; hence, they offer this industry market (MBA Skool Team, 2021). If society considers a given product fashionable, the young generation consumers are most likely to purchase the outfit.
Technological Factors
The advancement in technologies that are applied to design and market footwear products has benefited the sector reducing selling and production costs. Currently, there are many social network platforms, which brands may be used to promote their products (MBA Skool Team, 2021). TOMS Shoes uses networks such as Twitter, Instagram, and Facebook to advertise its products.
Environmental Factors
Currently, the world treasures its environment, although human exploitation has decreased environmental sustainability. The changing environment has resulted in an influence on several industries. Awareness of ethical issues and green consumerism concerning the socio-environmental costs of a firm is increasing (Market Research Company, 2022). Particularly, eco-friendly firms are most likely to get positive feedback and preserve a positive public reputation.
Legal Factors
There are many laws and regulations put in place in different nations to regulate the footwear sector. It leaves the industry players to only comply with the legal requirements (LeSavage, 2019). TOMS Shoes has to be keen on the laws and regulations, which can differ between geographical areas.
SWOT Analysis
Overview of the Industry with Key Competitors Analysis
The shoe industry is the second largest fashion segment in the retail enterprise after apparel. The footwear market entails all sorts of shoes, which are manufactured for private end consumers (Statista, 2022). The market tends to increase approximately 1.5 times between 2021 and 2031 to reach about $640 billion in 2031 having a yearly compounded annual growth rate (CAGR) of 4% (Market Research Company, 2022). Demand across America accounts for about 36% share, currently, the global market for shoes is estimated at around $381 billion and is projected to grow substantially (Smith, 2022). Hence, footwear can be considered a basic needs item as it follows closely in significance to other commodities such as shelter, clothing, and food.
The main competitors of TOMS Shoes comprise OpticsPlanet, Vans, Shoedizzle, Zappos, Farfetch, Firsthand, TradingView, thinkorswim, eToro, and Steve Madden. However, TOMS is positioned number one in employee net promoter scores compared to its competitors in the market. The competitive edge that TOMS has over its rivals in the industry is its business model that other firms cannot imitate the same without experiencing bankruptcy and incurring losses (Ekundayo, 2021). The company has centered on making a difference and helping underprivileged people in society across the world with its product offer.
Segmenting, Targeting, and Positioning of TOMS shoe Brand
Market Segmentation
In these modern days, many people prefer to shop for comfortable and quality shoes regardless of their price. Most people raise complaints over $54 for each TOMS pair of shoes are rapidly declining like a pair of shoes sold at $5. A majority of working consumers are ready to pay extra costs for higher-quality shoes. Therefore, market segmentation is established on demographics, which focuses on the income and lifestyle of the working-class individuals in society, mostly white-collar jobs persons. They have high disposable income and are willing to pay a higher price for the shoes. According to behavioral character, the market may be segmented into brand loyalty and price sensitivity among consumers (Hessekiel, 2018). Further, based on the behavior and beliefs of consumers, the firm must change the quality and design of its products.
Targeting
The company has targeted its identified market in the Shoe industry, mostly for working youths and desire to look attractive in their workplace. It influences mostly those aged between 17 and 35 years who prefer to appear neat and stylish among their peers. It is mostly for the college or school and working groups, the firm may offer comfortable and durable shoes for their frequent use. In addition, to stay competitive in the market and sustain its corporate social responsibility, TOMS should provide attractive offers such as â buy one get one freeâ, offering free products alongside the shoes, and offering gift vouchers (Market Research Company, 2022). In targeting teenagers and children, the company must offer products at a reasonable price while considering their health, for example, utilizing skin-friendly materials.
Positioning
TOMS brand should have a positioning strategy that defines the product specialty and make its consumers feel important to the firm. It provides a reason for them to believe in the brand and increases consumer loyalty. TOMS brand positioning must be made to define its position in the highly competitive marketplace landscape. The company can attract consumers towards its new item using a statement such as âOne for one pledge is our mission and consumer satisfaction is our goal (Osborne, 2017).â The firm should offer the best quality, stylish, comfortable, and affordable goods for its consumers.
The 7Pâs of TOMS Brand Marketing Mix
Product
The company has a range of products comprising shoes, apparel, eyewear, coffee, and handbags available for its consumers. Besides, doing business, TOMS is engaged in activities aimed at creating a positive influence on employees, consumers, customers, the environment, suppliers, and communities (Ekundayo, 2021). The company involves itself in fulfilling the needs, offering education, enhancing health, providing clean water, and economic benefits to children and the elderly in marginalized regions.
Price
The firm targets people who desire to give and acknowledge environmentally friendly products even at a high price range. TOMS Shoes offers classy and quality products at a relatively higher price than its competitors in the industry are selling (Ekundayo, 2021). The higher price is worth it as it also assists the underprivileged people in society with the purchase of its shoes.
Place
TOMS majorly operates via franchises and is among the fastest-growing franchises globally. The firm opens its outlets in developing nations; hence, it helps underprivileged children and creates job opportunities for the local communities (Atkinson, 2017). Further, TOMS operates a franchise-based enterprise where it should take care of service delivery accuracy and product quality.
Promotion
TOMS introducing new items should have some promotional activities in the United States and other nations. Since the company is engaged in social work, it is highly dependent on word-of-mouth and social media network advertisement. TOMS uses social media networks such as Twitter, Instagram, and Facebook to advertise its new items using alluring images (Osborne, 2017). The company employs social media as a major strategy for connecting with its consumers.
People
Despite TOMS advertising using the product, it applies its one-for-one promotion to alter the tone and create a more selfless post âhelping others in need. It is linked to people and the company uses it to advertise its products but does not force it onto them (Atkinson, 2017). The company’s employees are its greatest asset; thus, maintaining them motivated may be TOMSâs objective that they may concentrate on to attain their goals (Osborne, 2017). The workers of TOMS are passionate about their work and share similar principles as the company.
Process
Based on the process, the website of TOMS is easy to utilize; therefore, simple to navigate through their pages. The company states its price beneath each product image. Underneath the websiteâs shop section, it is divided into men, women, children, and gift cards. Consumers do not get the delivery cost until the end, when they go shopping for the product. The shopping process is similar to other e-commerce websites such as Amazon and Alibaba (Osborne, 2017). Customers may add to their bags, check out and give their details.
Physical evidence
The company illustrates a range of ways they attain physical evidence of trust from its consumers on its website. On TOMSâs website bottom, there is a section referred to as “Get Help,” in which customers can track their orders, get contact information, and see the returns policy. It shows that the firm has a good trust level among its consumers; specifically, it can track its package, which gives reassurance and improves reliability (Osborne, 2017). Hence, they will get their purchase and the firm in general.
Conclusion and Recommendations
As customers interact with the TOMS shoe brand, it is more than just purchasing a pair of shoes. The activity entails helping those children in need and consumers feel better after doing it. TOMS has established on giving mission as one of its greatest and most successful in the long term. The company has discovered a way of offering citizens job opportunities in a profitable firm while offering donations to many nations globally that need aid the most. Further, the firm thinks of the shoes it sells and the lifestyle it represents by offering quality, comfortable, and stylish products.
Nonetheless, the company needs to become less reliant on its founder to grow further. TOMS should analyze different success parameters in its marketing plan to determine its success plan. The firm must adopt certain global considerations to establish a brand image and attain consumer loyalty.
Reference List
Atkinson, S. (2017). Introducing TOMS: The footwear brand changing the world one shoe at a time. Web.
Cotton, B. (2019). TOMS announced as latest certified B Corporation. Web.
Ekundayo, B. (2021). TOMS hoes. Web.
Hessekiel, D. (2018). The Rise And Fall Of The Buy-One-Give-One Model At TOMS. Web.
Key, A. (2022). Toms and Patagonia make B Corpâs âBest for the worldâ list. Web.
LeSavage, H. (2019). Toms Is Ending Its “One for One” Giving Program. Web.
Market Research Company. (2022). Footwear market size, share analysis by product type (Casual, fashion, occupational footwear), by material (Leather, natural rubber, synthetic rubber), by price range (Economy, mid, premium), by sales channel, by region – Global forecast to 2031. Web.
MBA Skool Team. (2021). Hush puppies PESTLE analysis. Web.
Osborne, A. (2017). How the company TOMS use each stage of the marketing mix (and how they work together) in the companyâs digital marketing. Anna Osborne. Web.
Smith, P. (2022). Footwear market size worldwide 2017-2027. Web.
Statista. (2022). Footwear report 2022. Web.
Ănören, M., Arar, T., and Yurdakul, G. (2017). Developing competitive strategies based on SWOT analysis in porter S five forces model by DANP. Journal of Business Research – Turk, 9(2), 511-528.
Wydick, B. Katz, E. Calvo, F. Gutierrez, and F. Janet, B. (2018). Shoeing the Children: The Impact of the TOMS Shoe Donation Program in Rural El Salvador. The World Bank Economic Review, 32 (3), 727â751.