Culture and Society

Tom's Shoes succeeds at marketing, but Warby Parker wins for a better anti-poverty model

More consumers are choosing products that are both hip and support a cause. Photo:<a href="http://www.flickr.com/photos/27055329@N06/5770536860/">mariahfleming (Flickr)</a>
More consumers are choosing products that are both hip and support a cause. Photo:mariahfleming (Flickr)

This article was republished in The Christian Science Monitor.

We already know that good marketing does not equal good aid. Tom’s Shoes has earned a fair amount of criticism for its “One for One” model—a pair of shoes is donated to a child in need for every pair bought by the consumer—but, after seeing the marketing benefits, more and more for-profit businesses are using a similar model to donate goods in developing countries.

Here's the basic problem of the “One for One” model: when everyone in a community can get a free pair of shoes, the local shoe vendor goes out of business. Not only does it hurt the local economy, but it is also a short-term solution that creates long-term problems. Tom’s model may also encourage poverty tourism, as the company allows people to pay to travel along with distribution trips as shoe fitters. Niharika Jain writes more in-depth about the unintended consequences of charitable giving for the Harvard Crimson, and Peace Corps volunteer Zachary Mason discusses Tom’s Shoes from a public health perspective, questioning the cost-effectiveness of the model for reducing disease.

Despite the unintended consequences of its “One for One” program, Tom's has a cult following. Chances are if you don’t already have a pair, you know someone who does. Is Tom’s merely a fashion statement, or are consumers drawn to the company for its cause, creating an atypical status symbol? It’s hard to know what motivates individual purchases of Tom’s products, but a 2010 Cone Cause Evolution study shows that 85 percent of consumers surveyed feel more positively about companies that support a cause they care about. When price and quality are equal, most consumers choose the product supporting the cause.

If we want to be socially conscious consumers it’s important to understand the impact of Tom’s and similar products. We can learn from Tom’s marketing success, but to alleviate poverty in the long-term we need to promote sustainable programs the support local economic development.

Warby Parker, another for-profit enterprise that donates its product in developing countries, is getting a lot of attention for the innovative way that it sells eyewear to the consumer and sends glasses around the world to people who can’t afford them—earning them the B Corp status. Like Tom’s, they are popular among the fashion-conscious and have a hugely successful marketing campaign.

Warby Parker partners with a non-profit called Vision Spring in order to donate their glasses abroad. Vision Spring is in tune with how local economies function and what kind of products are culturally appropriate—something that Warby Parker itself may not have the resources to know. Vision Spring receives funding and glasses from Warby Parker to train low-income local entrepreneurs to start their own businesses selling glasses at affordable prices.

Warby Parker uses the same “buy one, give one” strategy as Tom’s, which is successful at attracting consumers, but is sensitive to the impact donations have on local economies. Warby Parker and Vision Spring’s mission is to help entrepreneurs sustain a business and to create jobs—not create a dependency on unpredictable donations which unintentionally creates economic stagnation.

As socially conscious consumers, we should reserve some skepticism for businesses that claim to do good. Transparency and randomized studies are need in order to assess their impact. A recent randomized control trial by the University of Michigan found that people who bought Vision Spring glasses earned 20 percent more, but more research is needed. It is also promising that Vision Spring is continually learning and evolving its strategy to increase its impact, as recognized by Duke's Fuqua School of Business Center for the Advancement of Social Entrepreneurship.

This partnership between a for-profit business and a non-profit looks promising and solves some of the problems with Tom’s “One for One” model. “Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime,” is what we’re told. It’s an excellent example of the ability of corporations and non-profits to do what they do well and team up to do good. Hopefully, organizations that inform consumers—like B Corp—will make this kind of partnership more attractive.

Have you bought or would you buy Warby Parker glasses and Tom’s Shoes? What drew you to the brand?

Monica Gerber is a 2011 graduate of Reed College. Read her other contributions to Global Envision.

The sOccket: A Soccer Ball that Generates Electricity

Could soccer help the developing world score more electricity? sOccket, a plug-in soccer ball that captures energy during a game and uses it to charge LEDs and batteries, could be a game changer.

Developed by four Harvard University students connected by their travels to Africa and other developing nations, the idea for the sOccket was originally kicked around for an engineering course assignment, explains the Harvard Gazette. Their ingenious concept involves inserting a soccer ball with an inductive coil mechanism that transforms the toy into an eco-friendly portable generator. The kinetic movement of the sOcket ball propels a magnet through a coil that induces a voltage to generate electricity.

The newest ball requires as little as 10 minutes of play time to generate three hours of energy on an LED light. "The beauty of sOccket is that a kid in a developing nation can play a game of soccer after school, leave the playground, take the ball home, plug a basic lamp into a built-in fixture and have enough light to do homework," observes the blog Social Innovation.

Currently most African nations use kerosene, an expensive and toxic substance, to power their homes. However, sOccket is sidelining the oil-based fuel. With over 46 million soccer players in Africa alone, soccer has become the continent's most electric sport.

Five things to know about the 7 billionth human

On Monday, the world welcomed its 7 billionth person. The implications of population growth are similarly staggering in number, but here are five of the more important things to know about the growing world community.

There might not be 7 billion of us. Yet.

The October 31st date was chosen by the United Nations Population Fund, and it’s somewhat symbolic. "There is a window of uncertainty of at least six months before and six months after the 31 October date for the world population to reach seven billion," UN population estimates chief Gerhard Heilig told the BBC. However, the crux of the matter—the ever-increasing world population and the problems that come with it—stands.

Human being No. 7,000,000,000 is probably poor—and it's likely the parents didn't plan the pregnancy.

The developing world acted as the engine for most of the last decade's population growth. It’s home to the world’s seven fastest-growing cities, according to Foreign Policy. As such, it’s attracting the attention of policymakers and crystal-ball-gazers alike. Many, like the Worldwatch Institute’s Robert Engelman, propose extending access to contraceptives and encouraging smaller family size to curb population-related problems, though a recent Economist article says that this would only have a modest effect in the face of scarce world resources.

Sure, resource scarcity is a problem, but maybe it doesn’t have to be.

Not all commentators are equally pessimistic about continuing population growth. Some of the most basic problems, like access to food and water, might really be problems of efficiency rather than scarcity. Global Envision contributor Ben Osborn recently wrote about a study by the Consultative Group on International Agricultural Research that showed that given proper integration and storage of water resources, no one would have to go thirsty. On the food front, a scientific study published in Nature showed that proper agricultural reforms “could increase global food availability by 100–180%,” more than enough to meet the needs of our growing population.

The antidote to population could be migration.

Ensuring good quality of life for the earth’s inhabitants goes beyond just food and water. The UN’s State of the World Population 2011 report identifies migration as a trend that can be used to help aid in economic development. Wealthy countries with declining fertility rates could provide job opportunities for workers disenfranchised in their overpopulated home countries. At the same time, migration is a hot-button issue for developed nations that may not be so keen to open their borders. The report also cites increased access to education as a key factor in reducing population growth and providing better opportunities for youth in developing nations.

Maybe we should all just learn to stop worrying and love the population bomb.

Many fear rapid population growth in a world with limited resources, but given the proper policies it might not have to be so scary. Since there’s no “undo” button for world population, perhaps the best question to ask in light of the 7 billion marker is “How can we make the best of it?”

Want to know where you fit into the 7 billion? Check out The BBC’s “What’s Your Number” tool.

Margo Conner is a senior at Lewis & Clark College in Portland, Oregon, majoring in international affairs. Read her other contributions to Global Envision.

Coffee and Job Creation, All in One Place

Topics: Corporations
Countries: United States
Previously filed under: Culture and Society
A $5 donation with your morning cup of coffee could be the first step to job creation. Photo: <a href="http://www.flickr.com/photos/robohit/2287457553/sizes/m/in/photostream/">rohobit (flickr)</a>
A $5 donation with your morning cup of coffee could be the first step to job creation. Photo: rohobit (flickr)

Would you like to create a job with that latte?

Starting today, this will be the question you’re asked the next time you step into a Starbucks for a cup of coffee. November 1st marks the beginning of the Create Jobs for USA program created by Starbucks chairman and chief executive Howard Schultz. Starbucks is partnering with the Opportunity Finance Network and community development financial institutions (CDFIs)—lending institutions that work with populations ineligible for traditional bank loans—to empower every customer to make a difference through small sum donations.

The $5 donations will provide the funding for affordable loans to small U.S. businesses that are selected by local CDFI’s to have the greatest potential to create and sustain job growth.

With nearly 7,000 stores in the US, the potential donation base is huge. And as concerns about the economy are higher than ever, the Create Jobs program is a huge step toward taking the jobs issue out of the hands of politicians and putting it in the hands of those most affected, one cup of coffee at a time.

Made in China: A slowly emerging consumer class

Gap opens in Shanghai. Photo by <a href="http://www.flickr.com/photos/kreep/">kreep (flickr)</a>
Gap opens in Shanghai. Photo by kreep (flickr)

What would happen if you took off every article of clothing not made in America? asks ABC at New York’s Grand Central Station (video).
_____

Gap is betting big on China, announcing plans to triple its retail stores there by the end of 2012, reports the Associated Press. But in doing so, the chain will directly compete with its own Chinese suppliers, which for years have been sharpening their teeth making cheap knockoffs of the popular clothing.

Gap is not the only global brand to jump on what they hope will emerge as the next massive consumer class. Apple, Nike, Gucci, Louis Vuitton and Walmart have all positioned themselves to profit from China's nouveau riche. Despite these expectations, the New York Times reports that China’s consumer spending has actually plummeted in the last decade as a portion of the overall economy, to about 35 percent of gross domestic product, from about 45 percent - the lowest percentage for any big economy anywhere in the world.

The remarkable growth the nation has seen has not translated into fruits for middle class families, but rather state-run banks, government-backed corporations and the affluent few with connections, says Carl E. Walter, a former JP Morgan executive who is co-author of “Red Capitalism: The Fragile Financial Foundation of China’s Extraordinary Rise.” Worse yet, low-wage workers who make the clothing sold in stores like Gap simply can’t afford the finished goods. Marketplace’s Kai Ryssdal visited a new Gap store in Shanghai recently; the most striking thing he found about the store was how empty it was. Sales of global “brands” come mainly in the form of the counterfeits and knockoffs sold at busy outdoor markets.

The New York Times suggests the “state capitalism” that’s fueled much of China’s growth must be dismantled before ordinary Chinese citizens will start feeling flush enough to buy Gap’s ‘nostalgic’ 1969 jeans - even the made-for-China version. Chinese Premier Wen Jiabao asserts that the government is ready to make some of those changes. Until then, hedge your bets.

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