How TOMS' new socially conscious 'marketplace' could be a boon for profits

TOMS, the socially conscious shoe brand, on Tuesday launched an e-commerce business that will support like-minded companies — and potentially draw big profits for the California-based company.

TOMS is best known for both their signature product — those colorful canvas slip-ons that have their own rack at Urban Outfitters — and their socially conscious give-back model: For every pair of shoes or glasses a customer buys from TOMS, the company donates a pair of shoes or provides eye care for a child in need. Since 2006, when the company launched, TOMS has used this model to donate more than 10 million pairs of shoes to children in over 60 countries, and is now poised to double that number in the next 12 to 18 months. The eye-care program, which launched in 2011, has so far provided 200,000 pairs of glasses to those in need.

The new marketplace is a home to more than 200 products made by companies using some form of that "give-back" model. For example, the site hosts products from Stone + Cloth, a backpack maker that has partnered with the education non-profit, the Knock Foundation. For every item sold, Stone + Cloth helps provide a child in need with one week of schooling.

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up

The site allows shoppers to peruse the store by cause (children, education, health, etc), region of impact, or brand, and features a profile on each company's founder and mission. The idea is to give "other social entrepreneurs a platform right here on our site to help them succeed," says TOMS.com.

At the same time, the new venture puts TOMS in a position to capitalize on a growing market of ethical brands. Sapna Maheshwari explains in Buzzfeed:

Rather than using a consignment model where TOMS charges the companies a fee for the items sold through the site, TOMS Marketplace operates independently, buying the goods at wholesale prices, controlling storage and shipment, and charging "a standard retail markup" to customers, says Maheshwari.

The venture will also mark TOMS' first serious foray into advertising — something the company has so far avoided, save for "retargeted digital ads," which would pop up online for individuals after visiting TOMS.com. For the Marketplace, the company is ratcheting up the effort. The New York Times' Andrew Adam Newman reports:

The site will also address a sticky spot for TOMS's business: Attracting men. TOMS sells about 75 percent of its shoes to women, and with the marketplace, Mycoskie has an opportunity to crack open that demographic. "In curating the Marketplace, Toms focused on carrying products that both men and women would love equally," says Zoe Fox in Mashable. Mycoskie said something similar to Newman. "We sell a lot of shoes to guys, but we’re not connecting to mainstream guys the way that we need to," he told the Times. "A big part of our future is with guys, and it was an important part of our criteria to have some of these more masculine products that reach more men."