One more letter in BT issue dated 21st June 2015
My response to TOMS Shoes Case Study
What can we learn from this case study?
1. My personal experience:
I recently purchased a pair of size 8 black leather rubber-soled chappals for my daily use from the nearby local market for Rs.900/- after haggling for a 10 % discount on a MRP of Rs.1000/-. The Engineer in me tried to work out the average maximum selling price for such a chappal and it came around to Rs. 450/- or so.
2. My personal view:
From the above experience, it was amply clear that the sellers were selling it for almost double the price. Hence TOMS’ much touted strategy “One For One” is not a losing proposition at all since the company is still making some profit. So when TOMS sells a pair of shoes, it can afford giving a new pair of shoes to an impoverished child, and when TOMS sells a pair of eyewear, it can still afford using a part of the profit to save or restore the eyesight for people in developing countries. All said and done, Blake Mycoskie’s company has deservedly won many awards.Kudos!
3. What I missed:
BTW, the study somehow missed touching the reason behind the name of the company. The company name TOMS has knowledgably been derived from the word “tomorrow,” and has evolved from the original concept, “Shoes for Tomorrow Project.” So much for the company’s enlightened vision!
4. What others feel:
One well known writer Daniel H. Pink has described the company’s business model as “expressly built for purpose maximization”, whereby TOMS is both selling shoes and selling its ideal and thereby creating consumers who not only purchase shoes but also make a purchase that transforms them into benefactors! Out-of-the-box thinking indeed!
5. Why others do not emulate TOMS:
It is said that TOMS’ ‘One for One’ model has inspired many different companies to adopt similar concepts. The company’s strategies and action-oriented efforts for philanthropy and CSR initiatives are indeed laudable but it makes one certainly wonder why shoe companies in India like BATA, LIBERTY, RELAXO and CARONA etc do not follow TOMS’ footsteps!
6. On facing criticism:
TOMS has received criticism from the International Development community who have charged that TOMS’ model is designed to make consumers feel good rather than address underlying causes of poverty. Criticisms have also included whether or not the shoe donation is as effective as a monetary one to other charities. TOMS’ founder Blake Mycoskie had responded to these criticisms in November 2013, saying “If you really are serious about poverty alleviation, then you need to create jobs. At first I took that personally, but then I realized that they were right! Using our model to create more jobs is the next level.” The company has announced its plans to have one-third of all its shoes produced in countries receiving aid by 2015. Superb response to the critics!
6. On marketing strategies:
TOMS’ marketing has involved fashion shows, high- profile events, university-campus marketing, social media, and even temporary pop-up stores. All opportunities for advertising have been used to the hilt!
7.On environmental issues:
It is learnt that TOMS’ products have been reportedly created to fit with different environmental ideals as well, including the creation of shoes that adhere to “vegan” product restrictions in their product lines. Yes even environmentalists have been kept happy indeed!
8. Facts speak for themselves:
It is reported that as of 2012, TOMS has given away over one million pairs of shoes in 40 countries. Wow! Take a bow!
J S Broca, B TECH MECH; PGDBM;Retired Chief Manager,
Bank Of India, New Delhi
My letter in BUSINESS TODAY ISSUE DATED JUNE 21 2015 ON START-UPS
TOMS Strategy
This refers to your case study on TOMS shoes (A Shoe for a Shoe, and a Smile, June 7). From my experience, it is amply clear that a company normally sells it for almost double the price. Hence, TOMS’s “one for one” strategy is not a losing proposition at all since the company is still making some profit. So when TOMS sells a pair of shoes, it can afford to give a new pair of shoes to an impoverished child, and when TOMS sells a pair of eyewear, it can still afford using a part of the profit to save or restore the eyesight for people in the developing countries. It is reported that as of 2012, TOMS has given away over one million pairs of shoes in 40 countries. All said and done, Blake Mycoskie’s company has deservedly won many awards. Kudos!
– J.S. Broca, New Delhi
MY VIEWS ON MENTORING….
Author: Jatinder Pal Singh Broca Jun 28MY VIEWS ON MENTORING
In the latest issue of BUSINESS TODAY dated 5th July 2015 there is an interesting article on mentoring.
Here is what I have written to BT in response:
Dear Sir,
This refers to your superb feature on “Mentoring” in the latest issue of BT (dated July 5th 2015).Though the piece strictly refers to mentoring in case of Indian family businesses, mentoring is equally often essential in other forms of businesses as well. Basically mentoring means an employee training system under which a senior or more experienced individual (the mentor) is assigned to act as an advisor, counselor, or guide to a junior or trainee (the mentee). The mentor is responsible for providing support to, and feedback on, the individual under his or her charge. One can loosely define the mentor’s role as that of a friend, philosopher and guide.
My humble submission is that acting as a mentor for a “fee” may be another avenue of earning by sharing one’s experience / expertise but acting as a mentor for “free” gives more joy and satisfaction to the person playing the role of a mentor. For example, in the case of a senior college professor, who voluntarily acts the role of a mentor, then, If his student passes a tough competitive exam with his guidance, if he / she lands a good job in a career field of his / her choice with his help or if he / she gets a much coveted position / promotion in her job / office with his tips, then the professor feels amply rewarded and blessed. Such a free mentorship is a way of giving back something to the society I feel.
One more point I wish to submit is about the latest trend of “reverse mentoring” in our country, based on my reading about this interesting subject. In a young country like ours where more than 50 per cent of the population is below the age of 25 and more than 65 per cent below the age of 35, the traditional concept of mentorship may not yield the desired results. With our population becoming younger, it is essential for organizations to evolve to the needs of new young India. Within this broad spectrum of change is emerging a technique known as “reverse mentoring”. This concept, being increasingly adopted by savvy, new-age organizations, turns the old paradigm of mentorship into a higher and more effective collaborative effort. The clincher here is that the younger person becomes the mentor and the seasoned senior professional becomes the mentee. Typically, the mentee has more overall experience (as a result of age) than the mentor (who is younger), but the mentor has more knowledge in a particular area and therefore reverses the conventional relationship.
Benefits of reverse mentoring for the mentor are:
He gets access to a wealth of experience for his/her own personal development. A good mentor would keep on picking the mentee’s brains. He gets valuable insights on the virtual world, which is becoming increasingly relevant for the business. The challenge of mentoring a leader forces the mentor to venture into unexplored territory —something that he/she may not be doing in the routine job.
Benefits of reverse mentoring for the mentee are: He gets to understand the consumer preferences, likes and dislikes of the youth segment. He helps engage his/her team better by understanding their needs and desires. He helps getting acquainted with technology, social media, trends etc. A reverse mentor could be a good sounding board for the mentee to test and develop ideas.
Enjoyed reading the article and sharing my views!
J S BROCA, New Delhi