Answered: Can you find the strength points.

Principles Of Marketing

17th Edition

ISBN:9780134492513

Author:Kotler, Philip, Armstrong, Gary (gary M.)

Publisher:Kotler, Philip, Armstrong, Gary (gary M.)

Chapter1: Marketing: Creating Customer Value And Engagement

Section: Chapter Questions

Problem 1.1DQ

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Can you find the strength points.

Transcribed Image Text:Core Strategy Resources Core Competencies • Pioneered the one-for-one business model; diligence in execution has created a strong brand • Creation and management of for- profit/philanthropic business strategy children and people in need that is sustainable • Ability to create passion and excitement about what TOMS is doing in others (nonprofit partners, TOMS volunteers, Interns, etc.) • Willingness to learn (Le, responding to critics who point out how TOMS could be daing things better by adopting the best suggestions) Key Assets • Blake Mycoskie • Corporate culture - Relationships with nonprofits that help TOMS distribute products to Business Mission Basis of Differentiation • Strong brand • Business structure: TOMS (for profit) and its collaboration with Friends of TOMS (non profit subsidiary) • Products (shoes, eyewear, coffee) that resonate with consumers) • TOMS volunteers "One for One" • TOMS volunteers - Interns (that work in TOMS facilities) •Campus dubs • Day Without Shoes campaign • Ability to change lives Target Customer(s) • Consumers who resonate with TOMS one-for-one approach and the company's combined for- profit/philanthropic persona Product/Market Scope • Shoes, eyewear, and coffee • Branded products (t-shirts, caps) • Misc items sold via the TOMS marketplace • TOMS products are sold worldwide. Shoes have been distributed to 60 countries, eyewear 13, and clean water provided in five Financials Operations Product (or service) Production Revenue Streams Channels • Product sales, which include shoes, eyewear, and coffee • TOMS branded products (t-shirts, sweatshirts, caps, and TOMS flags) • Misc items available via the TOMS Marketplace, induding Accessories, Home & Bath Products, and a small number of Tech Products • All sales trigger a commensurate gift to people in need. • Products (shoes, eyewear, & coffee) are made by contract manufacturers which are carefully selected and monitored • Products are shipped directly to retailers or online outlets for sale to their customers (TOMS does not dropship) • TOMS collaborates with nonprofits to distribute the shoes and eyewear and to provide clean water for those in need • Online (TOMS.com, Zappos.com, etc.) • Retailers (Nordstrom, Whole Foods, etc.) • Products distributed to children and adults in need via Friends of TOMSS, nonprofit partners, and TOMS volunteers Financing/Funding • Initial capital infusion of Ss00,000 from founder Blake Mycoskie • Profits from business operations • TOMS customers/supporters volunteer their time to get products to adults and children in need and to spread the word about TOMS. Cost Structure • Cost-driven business • Low fixed/high variable costs • Major categories of costs: Product manufacturer, distribution of products to people in need, salaries and general administrative Key Partners • Friends of TOMS • Nonprofit partners • TOMS volunteers • Top brands, such as Ralph Lauren and Element Skateboard • Affliates (via the TOMS affiliate program) Toms: Barringer/Ireland Business Model Template O 2014 Bruce R. Barringer and R. Duane Ireland in part because local organizations, already embedded in a country, know the needs better than TOMS does and can direct the company. An example is TOMS's partner- ship with the Seva Foundation to implement its eyewear/ restore sight program. The Seva Foundation runs sight programs in Nepal, Tibet, and Cambodia. It is uniquely equipped to help TOMS make the best use of its dollars. TOMS's product/market scope now includes shoes, eyewear, and coffee. The company also has "Marketplace" that sells a variety of items, including jewelry, household items, and tech products. The com- pany's "one for one" mission still applies, just in a differ- ent form. If you buy a $140 Turquoise Alba Necklace, for example, your purchase will get you the necklace and provide 11 meals for a child in need. efforts are making a difference, and it involves a lot of people in what it does. These factors have enabled TOMS to build a strong brand. Its core strategy is also working. It has remaine donations. TOMS has also excelled at creating excite- ment and passion in others for what it is doing. It does a lot to elicit this. For example, every two weeks a group of TOMS volunteers travels to Argentina or another part of the world to make a "shoe drop," which is the term that TOMS uses for distributing shoes. Anyone can apply for the trip, and for many it is a life-changing experience. Every shoe TOMS gives away is placed on a child's foot by a TOMS volunteer. Volunteers pay their own travel ex- penses, but the trips are organized by TOMS. TOMS also listens. It has both proponents and crit- ics that are vocal in their feedback. Rather than ignoring the feedback, TOMS reacts, which encourages addi- tional feedback. For example, one source of criticism that TOMS has faced is that when it gives a child a pair of shoes, it is a one-time event. The child will eventually sustainable without needing Resources TOMS has been diligent in the execution of its one-to- one model. Its products are appealing, its philanthropic

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