Brand of the Year: Toms Shoes

Toms Shoes is the little company that could.

Though it launched just four years ago, Toms has become one of the most talked-about brands in the footwear business, as well as a leader in the growing social entrepreneurship movement.

Consider this: In September, Toms gave away its millionth pair of shoes — a milestone founder Blake Mycoskie said he never expected the company would reach so quickly. “It’s hard for people to imagine,” he said, “but it really was just me and a couple of interns in my apartment [in Venice, Calif.,] in the beginning. None of us knew anything about the footwear business, but we had an idea and a desire to make a difference.”

That idea took seed in early 2006, when Mycoskie traveled to Argentina for vacation and saw that many of the country’s children were without shoes, making them susceptible to dangerous foot diseases. He conceived Toms based on a simple buy-one, give-one business model, and since then, the Santa Monica, Calif.-based company has donated shoes to kids in 22 countries and built a roster of more than 1,000 retailers, from boutiques to top department stores, including Nordstrom, Neiman Marcus and Bergdorf Goodman.

Nordstrom was an early supporter. “We partnered with Toms from the beginning not only because we liked its one-for-one model but because we felt it was a special product with broad appeal and [one that] would resonate with our customers,” said Scott Meden, EVP and GMM of shoes for the Seattle-based retailer. “Our customers are incredibly passionate about Toms.”

While the magnetic Mycoskie is clearly the spirit and brains behind the brand, he credits Toms’ enthusiastic fans — the “tribe,” as he calls them — for driving the company’s rapid growth. And that enthusiasm reaches far beyond buying shoes. Consumers have been an integral part of the brand’s grassroots marketing machine, helping to spread its message through Facebook, YouTube and Twitter (where, at last count, Toms had more than 540,000 followers). They organized campus clubs at their schools and hosted “Style Your Sole” parties with their friends. And this year, more than 250,000 people around the world went barefoot as part of the company’s annual One Day Without Shoes event.

“From the beginning, we really encouraged people to be part of the creation and brand-building process of Toms,” said Mycoskie, who has written a book that offers an inside look at the making of the company that will be published by Random House next year. “It’s hard for people to connect emotionally with something when they feel they are just one among a gazillion. But when they see they are having a real impact — with the kids getting the shoes and the growth of the brand — it creates a sense of ownership.”

As Toms has taken off, it has branched out beyond its classic canvas slip-on, which retails from $44 to $54 in adult sizes, to offer other looks including lace-up sneakers, wrap boots and even wedges. A youth line was introduced in 2009. To build a more year-round business, the brand also added styles in heavier-weight fabrics such as flannel and wool.

Being new to the business, Toms works with several production partners, among them Bellevue, Wash.-based Topline Corp., to assist in developing and manufacturing its shoes. “They initially came to us to take the business to a bigger level in terms of volume, but we also use our information from our shopping and trend-gathering to help them develop new ideas and challenge them to think outside the Toms world,” said Bill Snowden Jr., Topline’s SVP of sales. “We’ll say, ‘Have you thought about adding cuffs to the boots or incorporating fur or shearling linings in the shoes?’ And they’ll take our ideas and go back and tweak them. It’s really a collaborative process.”

Jim Estepa, president and CEO of Genesco Retail, which oversees the Journeys chain, cited Toms’ “perfect blend of fashion and charity” as a key to its success. “[They] continue to evolve [their] product offering by expanding the materials, colors and patterns that appeal to a young, fashion-forward consumer, [and] they’ve done an outstanding job of building a brand that resonates with [people],” he said.

Although Mycoskie recognizes the need to diversify and broaden the assortment, he said he has no intention of straying too far from the core silhouettes. Instead, he wants to keep the business simple and not distract from giving. To update its retail partners on those efforts, the company this year released its first giving report, filled with the facts and figures behind its donations.

“Business is great today and hopefully it will continue to be great tomorrow,” said Mycoskie, “but what is going to keep our retail partners with us into the future is if they are connected with the part of the business that is most important to us, and that’s the giving.”

While the past four years have certainly been a wild ride for Toms — from managing its growth to contending with competition from all sides — the company is just getting started. It continues to expand its retail distribution and sees plenty of global opportunity. Though Toms is already in more than 30 countries, a new distributor for Japan is expected to significantly boost sales in that country, and the U.K. market is showing strong growth. Back at home, Toms has had a series of successful pop-up shops, and Mycoskie said permanent retail stores could become part of the brand’s strategy in the future.

Still, at the end of the day, “it’s not about sales numbers or stores added or countries opened; it’s about engaging people,” Mycoskie said. “I really see Toms more as a movement, a community, rather than a company.”

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