Toms Shoes Company’s Strategic Analysis

Abstract

Although businesses are rarely involved in non-profit activities, some companies, such as TOMS, help people in need. To evaluate the advantages and disadvantages of these activities and future possibilities, a SWOT analysis may be used. It is demonstrated that TOMS’ philanthropic campaign is characterized by strengths associated with charity and brand popularity and weaknesses concerning ethical issues and advertising. The experience of such companies can be used by Kiva and other non-profit organizations. Skills development should become the main strategy for businesses and philanthropy institutions.

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Strengths

  1. Attention to philanthropic issues: TOMS concentrates on the humanitarian problems existing in the present-day setting and incorporates charity into its business attracting those customers who want to make a difference and help.
  2. One for One campaign: the business model that allows benefiting and simultaneously making donations is explicit and effective.
  3. The popularity of the trade name: the company is recognized all over the globe.
  4. TOMS’ unique story: the company was established to achieve two diverse goals: to make a profit and help poor children in the Argentinian villages.
  5. Famous people’s support: many celebrities, for example, Scarlett Johansson and Keira Knightley, like this brand and set the example of charity via buying TOMS products.

Weaknesses

  1. False positivity: while the idea of help seems good, people from poor regions become dependent on charity providers and do not learn how to improve their lives.
  2. Price of products: the purchase sum that includes the price of shoes for a customer, the purchase of an extra pair, and shipping costs are considerable.
  3. Lack of commercial advertising: since TOMS is not engaged in traditional promotional campaigns, it is necessary to look for alternative solutions.
  4. Limited product line: not all shoes are included in the campaign and the collection of shoes that children receive still needs to be wider.
  5. Manufacturing: the products are made in countries with low labor costs and factory abuse cases.

Opportunities

  1. International expansion: the company may open new stores all over the world.
  2. Help in a wider range of regions: more developing countries may receive TOMS shoes.
  3. Quality enhancement via technological innovations: the company can focus on shoes intended for specific climate conditions.
  4. Price reduction: to attract new customers and win their loyalty, the price level is crucial.
  5. Help to other categories of the poor: more people, for instance, the elderly population in the developing regions, may be addressed.

Threats

  1. Growing criticism in terms of ethical issues: people may change their mind and stop purchasing TOMS products because purchases do not create opportunities for the poor.
  2. Lack of TV advertising: social networks do not cover some populations.
  3. Competition: other companies offer similar products at lower costs and pose a threat.
  4. Bias allegations: favoritism towards particular locations (especially religiously associated communities).
  5. Trend disappearance: the popularity of doing good via buying certain products can decline in the future.

Kiva Case

As for Kiva, the non-profit organization aimed at alleviating poverty, its growth has some limitations (Kiva, n.d.). It will not be an easy task to find more field partners involved in the lending activities. To communicate with businesspersons, confirm the demands of potential borrowers, arrange funds, and raise money, the company will need much time.

There are some additional roles that Kiva can play to help the poor. One of the most significant measures is to help them acquire the necessary skills. The lack of such help proves to be one of the major disadvantages in the case of TOMS and becomes the reason for criticism. To avoid it, Kiva should demonstrate how the poor can be sustainable (for instance, introduce business strategies in farming and similar areas). Another innovation may be connected with Internet usage: people need to develop computer skills to find business partners. Finally, it is possible to introduce people to organizations that may be useful for them.

Reference

Kiva. (n.d.). Web.

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StudyCorgi. (2021, April 8). Toms Shoes Company's Strategic Analysis. Retrieved from https://studycorgi.com/toms-shoes-companys-strategic-analysis/

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"Toms Shoes Company's Strategic Analysis." StudyCorgi, 8 Apr. 2021, studycorgi.com/toms-shoes-companys-strategic-analysis/.

1. StudyCorgi. "Toms Shoes Company's Strategic Analysis." April 8, 2021. https://studycorgi.com/toms-shoes-companys-strategic-analysis/.


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StudyCorgi. "Toms Shoes Company's Strategic Analysis." April 8, 2021. https://studycorgi.com/toms-shoes-companys-strategic-analysis/.

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StudyCorgi. 2021. "Toms Shoes Company's Strategic Analysis." April 8, 2021. https://studycorgi.com/toms-shoes-companys-strategic-analysis/.

References

StudyCorgi. (2021) 'Toms Shoes Company's Strategic Analysis'. 8 April.

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