TOMS, a shoe company that donates a pair of shoes for every pair it sells, is not the innovative pioneer of “philanthropic capitalism” that it claims to be. It is just another generic profit-driven company that, given its peculiar specialization, can serve as an unfortunate reminder of the breadth of America’s attachment to good marketing.
If you have never heard of TOMS, here is the backstory: TOMS (it stands for “shoes of TOMorrow) is the sixth company created by serial-entrepreneur Blake Mycoskie. The company sells canvas slip-on shoes that are made in China, Ethiopia and Argentina. One pair of shoes is donated to “a child in need” for every pair sold.
So what is my gripe? TOMS sucks for two reasons. One, It is incredibly likely that TOMS makes a ton of profit (I say “likely” because TOMS financial records are very private). And two, most importantly, TOMS only gives shoes away because it knows altruism attracts consumers, specifically young-adult consumers.
TOMS is not being covertly (or at least un-blatantly) altruistic like Kroger, Macy’s or Wal-Mart, which together donated over $400 million to charity in 2010 according to Yahoo! Finance. TOMS is altruistic strictly because altruism makes the company a lot of money. If you don’t think it matters why a company is being altruistic, and that altruism is always admirable, regardless of the motive, I encourage you to keep reading.
Here’s the most accurate financial information I can give you based on what is available on the Internet. In 2009, during an appearance at The Clinton School of Public Service, Blake Mycoskie said, “Our [TOMS’] goal is to have a net margin of about 12 percent.” According to the company’s website, TOMS has sold over 2 million pairs of shoes since 2006. The average price for a pair of TOMS shoes is $54 (they range in price from $44 to $140; $54 is just the mode).
So here’s my math based on that information: $54 times 2 million is $108 million. 12 percent of $108 million is $12,960,000. If TOMS has consistently hit its goal of 12 percent, the company has likely pocketed $13 million in six years. That is over $5,000 a day for six years. Keep in mind this is $13 million that Mycoskie can use to buy whatever he wants: fancy wine, holographic Charizards, bounce-houses.
This is where it gets really interesting. Despite my investigative tone, Mycoskie has frequently acknowledged that he is “doing well” (his chosen expression for “filthy-stinking-rich”). Why does he do this? Well, Mycoskie has chosen to use his wealth as a delusionally cyclical justification for simultaneously being rich while actively perpetuating a quasi-Kerouacian mystic (he calls himself “Chief Shoe Giver,” lives on a yacht, and shamelessly refers to TOMS interns as “agents of change”).
TOMS is not “doing well by doing good.” TOMS is “doing well by manipulating the public relations benefits of doing good.” If there were no benefits to “doing good,” they wouldn’t do it.
Mycoskie’s motive is not altruism–it’s not even (as he states) to pioneer some new form of “philanthropic-capitalism.” He is a used car salesman dressed up as Che Guevara. He doesn’t care if a local shoemaker is put out of business or if the shoe wears out in a few months.
Mycoskie based TOMS model on simplicity for the consumer, not the needs of the receiver. I know what you’re thinking right now, “I don’t know a single African kid who wouldn’t be happy getting a free pair of shoes!” And I don’t know a single African kid who wouldn’t be happy getting a free bottle of water. But I’m not going to solve clean water issues by starting a company that donates a bottle of water to a kid with diarrhea for each one we sell. I would only start that company if I wanted to make a ton of money exploiting my generations admirable, but naive fondness for altruism.
If I actually wanted to help solve clean water issues I would donate money to Peace Corps volunteers that are currently installing water pumps in Africa. And if I actually wanted to help solve bare-feet issues I would donate to one of the many organizations that are actually working to do that, like Shoe Aid for Africa company that donates a pair of shoes every time someone writes a brief message of support to an impoverished child on their website; no purchase necessary.
Dylan Morrill can be contacted at
dmorrill@ksc.keene.edu
Danielcex
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