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TOMS SWOT Analysis

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on 7 May 2014

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Transcript of TOMS SWOT Analysis

TOMS SWOT Analysis
Laura Dahlgren, Morgan Trudeau, Scott Schulze, Mayela Villarreal

- Converse, Birkenstock, Rocket Dog, Vans and UGGs
-Similarities: Converse and Rocket Dog are are laced, casual shoes that are available in a variety of colors and designs.
Birkenstock and Vans slip on design; outdoors.
-Differences: TOMS does not use advertisement--"word of mouth".
Price--TOMS $40-$80. Rocket Dog, Converse and Vans $30-$90. Birkenstock and UGGs $100-$300.
TOMS is a globally recognized company that sells women's, men's, and children's shoes and eyewear. TOMS is just not another shoe company though, for every pair of shoes or eyewear it sells it donates a pair of shoes or eyewear to a child in need in a third world country. It all started in 2006 when company founder Blake Mycoskie traveled to a village in Argentina and saw that none of the children had shoes. So he created TOMS with the vision that for every pair bought he would donate one to a child in need. The motto for TOMS is one for one which clearly states the purpose of the company. TOMS supplies five different kinds of shoes for men, women, and children. They also supply eyewear for men and women. In terms of breadth and depth TOMS focuses more on depth because it only offers two products overall. By doing this TOMS is able to immerse itself into its specific product category.
Weakness are define in marketing as areas that need improvement. Something can definitely both a weakness and an opportunity. One example would be TOMS limited product line when the company first came out. They only had one style of shoe now known as the "classic" style. This was a weakness for the company because in comparison with more established brands like Sketchers they did not have as many products or as much diversity. TOMS turned this into an opportunity by creating more styles of shoes for its customers and therefore creating more product diversity.
Weaknesses as Opportunities
Company Introduction

What is a SWOT analysis? Whats the point?
hreats. A SWOT analysis is an abstract breakdown of a company. It doesn't necessarily include what you usually think of when talking about various companies.

Companies always want to increase their profit margins which begs the question, why make the analysis? When you know what you do well, or know what you do poorly, you increase your chances to get better, by identify potential pitfalls this can help your future as a company much more effectively.
Target Audience
Weaknesses/Strengths into Opportunities
-Potential: Create larger target audience through new designs
-Social Cause: Attracts growing trend of philanthropy in the Western World
-Charitable/Nontraditional view: as opposed to Nike (poor labor wages/conditions)

-Primary: college students, 19 to 24 years old, both males and females. Trend setters, socially active. Express individuality through sports, drawing, music, dance or charity work.
-Secondary: high school students, 14-18, both males and females. Trend setters. Important to spread message of TOMS and pass on trend to others.
Environmental Analysis

The company
has a a laid back and low key management approach, Blake attributes this to having strong management team. The entire company from its founder to the employees are out on the field staying in touch with the communities, this enables the company to meet its goal of running a for profit business that will sustain its philanthropic venture.

- are requires to certify that the materials used in the production are obtained in accordance to the company’s social responsibility in all operations. With natural, organic and Vegan material. Tom’s also ensures that suppliers produce the entire production is in accordance with all applicable laws in the countries they do business in. The suppliers must also comply with Tom’s policies including the prevention of slavery and human trafficking within the supply chain.

Marketing Intermediaries
- shoes are available in over 30 countries. they are available for purchase at Nordstroms, Urban Outfitters and small retail stores as well as web base stores. Toms now has 2 flagship stores one in Austin Texas and Venice Italy. The manufacturing companies are in Ethiopia, China and Argentina.

Keds, Scethcher Bobs, Paez Shoes among others.

Financial: The company is privately owned.
Media - the company has no marketing budget and relies on word of mouth and social media.
responds well to social consumerism and social media. Toms has a very involved customer base. The company keeps them well informed. They help fund philanthropic ventures. since the initial research they have started "coffee for you water for all.

socially responsible consumer men and woman and children
the shoes range in price from $40-$60, the consumers don't tend to mind the price. The idea that others are benefiting from the purchase of a good is motivation enough for some to be willing to part with their discretionary income
The company is showing growth- they are expanding their product line and are involved different philanthropic ventures
The company relies on social media sites and company blog for marketing and interaction with the public.
Social Culture:

Toms has a positive image and relationship with consumers because it has demonstrated great social responsibility as a company
Natural Environment:
They ensure that all aspects of production use natural or organic materials
There are those who believe that the action of giving in impoverished communities creates an economic stagnation by reducing the communities’ innate desire to become self sufficient and productive but for toms there is no foreseen political issues as of now.

Strengths, Weaknesses, Opportunities & Threats
-“One for One” campaign is great, it provides a product that is useful, affordable and for each piece of product sold someone in need gets a benefit. The philanthropic business venture is strong.
- Toms responds well to criticism
-Toms dedication to philanthropic ventures by helping and identifying areas where there may be needs and actually encourage others to start acting on compassion shows the company’s desire to be in the business of giving back while running a profitable business.
-Tom’s target market is adequately targeted the generation identifies with being socially responsible.
- The Companies constant communication with the consumer through social media has proven that their lack of marketing budget is not an issue. It means more money spent on philanthropic ventures.
- The shoes are available at different retail stores, including two flag ship stores, but predominantly they rely on web-base sales and ship the merchandise for free.
-The need for a marketing budget, it would not hurt if they dedicated money to advertising it would give them more exposure and create awareness of the product.
-The Materials used in production are mostly natural, organic and Toms demands that their supplier use this in the production of the shoes. This would be an issue if for some reason the producers had limited access of the materials affecting the production process and profits.
- Other products available on the market are similar to the Toms products
-Because there will always be a need for philanthropic ventures and Toms has done such an amazing job at identifying niche products and adapting there product line accordingly they have opportunities to grow.
With the strong web-base sales and continued communication with the consumers they have the potential to reach international markets and expand.
-Strong criticism has led some to have a strong opposition to Toms business strategy. There are those who believe that the money spent on the shoes could be put to better use. A negative image can hinder the work Toms is trying to accomplish.

One for one giving
Positivity customers get from shopping there
Brand recognition
Social Media Foothold
Price of shoe
Quality and Protection
Ineffectiveness of one for one
Selling false positivity to customers (charitable giving could be more effective)
Quality improvements through technology developments/partnership with established company
Lower price range
Expand giving regions
Expand market to include elderly
Allegations the one for one program is religiously biased
Tanking economy in relation to prices
Lack of TV presence
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