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Please provide me with five case studies which outline "Bombas" like companies that include revenue #s and how fast they've grown because of their impact.
Hello,
Thank you for your request asking us to provide with five case studies of how companies with social causes were able to get competitive advantage in their market.
Five companies chosen are Toms ( as requested), Warby Parker, Mitscoots, Swap Socks and Love Your Melon.
Below you can find a deep dive in to my findings.
METHODOLOGY
I first searched for pre-compiled lists of Buy One Give One (BOGO) model companies. Then, I checked various articles to understand their growth trajectory and competitive advantage to form the case study.
OVERVIEW
Studies have shown that customers are willing to compromise on the quality and even spend more money for buying a product if they are able to ensure a positive social impact through their purchase. The main advantage for the company comes from the free press, goodwill associated with the cause they support, higher level of social media engagement and conversion.
Most of the successful companies have a high quality product. But their stand for a social cause has helped them gain a positive image amongst the customers and thus helped them in growing their revenue.
Below you can find the details of the same.
The founder of TOMS, Blake Mycoskie set out to start the company in 2006 after his encounter in Argentina with a social worker who was delivering shoes to the poor in the rural area. Touched by the experience, he decided to start TOMS and get 250 shoes made and to sell it amongst his friends in the US to 'donate' 250 shoes to the rural poor in Argentina. He tied up with a retailer and an article about TOMS appeared in Los Angeles Times. From then on, there has been no turning back for the company.
The BOGO model proved an important aspect in TOMS growth thanks to the free publicity that came along.
The company had an annual growth rate of 300% in the first five years. 1/3rd of the company's business came through direct sales from website. They have spent nothing on traditional advertising and gains traction through their 5 million social media followers. The company has also ventured to selling eyewear and coffee business.
WARBY PARKER
Warby Parker started out in 2010 by disrupting the eyewear industry by circumventing traditional sales channels and designing glasses in-house to provide better prescription eyewear at fraction of the existing price. But what gave a tremendous push to their business was adoption of BOGO model. The company says that this business model has helped it to sell more than 1 million pairs of glasses. The company was able to attain its first year's sales goal within 3 weeks of launch. By the end of the third week, they had 20,000 people long waiting list to buy their glasses. By 2013, they had raised $60 million from Tiger Global Management, General Catalyst Partners, Spark Capital, Thrive Capital and First Round Capital, totalling the fund raised to $116 million.
Like Bombas, Mitscoots sells high quality socks, t-shirts and other gears for men, women and kids found with the mission to get, give and employ. Not only do they donate one for every sock sold, they also employ homeless people in their warehouses to provide them with better livelihood. The company was founded in 2012.
Mitscoots has also gained advantage owing to the cause they support and also because their products are made in USA.
SWAP SOCKS
Swap Socks aims to make a style statement by selling 4 unique design socks in a pack giving the users the freedom to swap and choose from 6 combinations. The company was founded in 2014 through crowd funding. They support Seva foundation in helping visually impaired poor regain their vision.
LOVE YOUR MELON
Love Your Melon sells beanies and has used 50% of its profits to fund cancer research initiatives. The company founded by Zachary Quinn and Brian Keller initially started off on BOGO model where they gave away a beanie to a cancer struck patient for every hat sold, but they soon sold more hats than the number of cancer patients in the country.
The founders attribute their tremendous success to the goodwill they have received for the cause that they support. They have active Facebook, Instagram, YouTube and Twitter handles with high level of engagement and conversion rate. They were also able to develop high level of brand awareness by reaching out to colleges and encouraging students to visit hospitalised children battling cancer.