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How TOMS ensured its new impact strategy was the right fit

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How TOMS ensured its new impact strategy was the right fit

About a year ago, Amy Smith was lying in bed, agonizing over the question that leaders never want to ask themselves right before announcing a new strategy: “What have I done?”

The chief strategy and impact officer at footwear brand TOMS was recalling her moments of doubt at this week’s Forrester CX North America event, which was hosted online as well as physically in Nashville. Her worries related to a decision whereby TOMS would move away from an approach to corporate social responsibility that made the company famous.

For about 15 years, anyone who bought a pair of TOMS’ trademark Alpargata slip-ons would trigger a donation on behalf of the brand to an underprivileged individual. According to Smith, this approach initiated in the early Aughts has benefited 100 million lives.

The feeling that you were doing good by purchasing from TOMs was undoubtedly a core part of its customer experience. So why change it?

“When you start thinking about how those values live out in your organization and with your consumer, you’re always asking, ‘Are we doing everything we can to bring those values to life?’” Smith said. “If you ever hesitate on that question, you have to step back and ask yourself: what are you doing, why are you doing it, and does it align with your mission, vision and values?”

Amy Smith TOMS
Amy Smith,
TOMS

Smith clarified those three areas as they relate to TOMs. Purpose, planet and people are the values. The mission is to “improve lives.” Its vision is that it “believes in a more equitable tomorrow – where all people have a chance to thrive.”

Those are obviously pretty broad pillars, and the one-to-one model is arguably just one way it can live them out. What Smith didn’t get into, of course, was the business and financial challenges the company has gone through. A story on Bloomberg Businessweek citied falling profits, mismanagement by a private equity firm and an executive shuffle.

Over a year and a half, Smith said TOMS researched and explored how it could evolve its impact strategy. This led to its current model, whereby it gives one third of its profits towards “grassroots good” that focus on improving people’s mental health.

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This works, Smith said, because it is something that is more financially sustainable for the company and a plan to which its leadership was prepared to commit. The language is very important, she added: the money goes to “grassroots” efforts because TOMS doesn’t necessarily have expertise in areas like public policy.

Mental health, meanwhile, is a universal issue that probably resonates across multiple demographics. Smith cited figures that one in three people will develop a mental illness at some point.

Smith also said the company’s impact strategy is informed not only by what’s going on out there and research among consumers, but also its grassroots partners. This made me wonder if more CX leaders should add a “Voice of the Partners” program to ensure the way they pursue their mission, vision and values is based on credible knowledge.

It’s easy to knock companies like TOMS that have been put on a pedestal for marketing based on ethical virtues, but its attempt at a comeback comes at a time when brand values and CX are increasingly intertwined. Not every company will be ready to follow in its footsteps. But they can at least begin thinking about where their path is leading.

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