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Arlington native's shoe company is helping needy children [Fort Worth Star-Telegram, Texas](Fort Worth Star-Telegram (TX) Via Acquire Media NewsEdge) Nov. 21--DALLAS -- The shoe apparently fits. Otherwise, some 200 scene makers and heartbreakers wouldn't be packed into the Neiman Marcus women's shoe salon at Dallas' NorthPark Center on a Thursday night to shop, schmooze and most importantly, see or maybe -- maybe -- get Toms Shoes founder Blake Mycoskie to autograph their new footwear. The 33-year-old Arlington native has burst into the world of socially conscious entrepreneurship with a cause: For every pair of new Toms shoes sold, the company gives away a pair to needy children. And people like the idea. "I've got 148 pairs of cowboy boots," said ponytail-wearing Dallas real estate investor Don Knobler, 65. "The only reason I'm here is to buy a pair of shoes so he can give another pair away," Knobler said as he eyed the latest Toms styles, a Neiman's exclusive featuring more expensive fabrics, sturdier soles and, yes, a higher price. Mycoskie figures that since he launched Toms three years ago, he's given away more than 140,000 pairs of shoes to children in Haiti, Ethiopia, Argentina, South Africa and the United States. He said he decided to create Toms during a trip to South America, where he met kids who had never owned shoes. Sporting designer stubble and black jeans, Mycoskie could pass for a rock musician, but there's clearly a businessman inside. He had already created a profitable laundry service as a Southern Methodist University student. By the time he launched Toms, he had sold four companies, including an outdoor advertising company to communications giant Clear Channel Media. "Our goal is to make a 10 percent net margin," said Mycoskie, pulling up a chair in the Neiman's salon as employees set up a pingpong table on which he and his fans would play later in the evening. "But we're not there yet." But he's got a plan: Sell, and give away, more shoes. "We knew we would never have the margins that other shoe companies have," said the Arlington Martin High School graduate, college drop-out and self-styled Chief Shoe Giver. "It will work with volume." Prices on the Toms Web site range from $44 to $79 per pair. Mycoskie won't disclose his revenue but will say he expects to sell about 300,000 pairs this year. Even at $44, that's roughly $13 million worth of camouflage, canvas and faux-zebra footwear in 2009. His wholesale revenue would be less than that, but he figures hitting his goal will put the company into the black. A brand and a dream Scenes such as the Neiman Marcus shoe debut are all about pumping up the volume. But while he's following in the footsteps of shoe legends like Manolo Blahnik and Christian Louboutin with his Neiman's appearance, Mycoskie's approach to business appears to be as cool and uncorporate as his black silk slippers. Since he's not in Toms' Santa Monica, Calif., headquarters all that much, he doesn't expect employees to show up there, either. The head of sales lives in Houston, and there are also employees in Austin. He says he runs things by phone. Though there are 52 employees -- the number seems to multiply like gremlins every time he shows up at headquarters, he says -- the former high school tennis player says he's in the office only a couple of times a month. Manufacturing is as widely disseminated as the employees. The "dream," Mycoskie said, is to someday have a factory in the United States. But for now, shoes are made in three foreign factories, including one in China. "They're a company whose business model is geared toward social change," said Sean Wood, who handles social media for KGBTexas, a San Antonio public relations and advertising firm. "A number of nonprofit and charitable organizations have used social media to promote their causes. "What Toms is doing is simply an extension of that," Wood said. "They are advocating while at the same time supporting a commercial enterprise." To implement the buy one/give one strategy, Toms operates Friends of Toms, a registered nonprofit that organizes volunteer work and what it calls shoe drops. The for-profit/not-for-profit arrangement is known as a commercial co-venture relationship. As such, it's regulated by the state. In some cases, the for-profit entity must register with California's attorney general "There's a lot of companies that do these things. I think their motivation is, it makes them look good," said Kent Seton, a Beverly Hills attorney who specializes in tax and corporate governance for charities. "It's absolutely legal." And effective. Research shows that consumers are likelier to buy if they think their money goes to charity, Seton said. There's also a tax deduction for the cost of the shoes, Seton said. And there's a lot of potential media attention for a company with a novel twist to giving, too. Getting out the word Toms' social media operation in Los Angeles has three full-time employees. Their job is tweeting on social networking site Twitter, dreaming up contests and generating buzz without paying for ads in old media. The approach recently yielded some much-viewed television spots sponsored by AT&T, based in Dallas, and featuring Toms. The deal was hatched when somebody from AT&T called Toms' 800 number to ask whether the company was a customer. The person ended up talking to Mycoskie's assistant, who said the boss was indeed a customer. AT&T's ads, which started in April, are so high-profile they've sparked a parody featuring a mean shoe mogul with a "worldwide network of tough guys" who repossess children's' shoes when paying customers complain. Parody notwithstanding, the Los Angeles Times reported in August that since the AT&T ads started, Toms' sales have risen 600 percent. Wood noted that Toms has 175,000 Twitter followers. That, said Wood, is dynamite, as is Toms' Twitter score, a 99.98 percent out of 100. The company also has nearly 4,500 Facebook fans. "Our whole model really works because our customers tell the story," Mycoskie said. "There's no way we could have done this 10 years ago." Toms is also tapping Digg.com, another social media site where users recommend (or dig) items they find interesting, with a limited-edition, $54 canvas shoe created for Digg. "So few businesses have found a way to tap into the social network to generate business," Wood said. "Digg is teamed up with Toms to create a line of shoes for Digg. So you can Digg it. You've got Toms linking up with a market maker." Of course, Mycoskie is also adept at doing business the old-school way. The Neiman's love-fest, which brought out 15 shoe sales associates in addition to the customers and shoe fans, gave Mycoskie the chance to press the flesh, be photographed and chat up the crowd. He got that event rolling when he met Neiman CEO Burt Tansky at a dinner two years ago. Talk about making contacts. Mycoskie has rubbed shoulders with the likes of former President Bill Clinton and entertainer Snoop Dogg. He made the Times with his last birthday bash. He does things that people remember. "I try to explain to my clients that you want to be unique," said Seton, the attorney. "Whenever something's different and interesting, that's when things gain attention." That includes becoming known overseas. Harriet Im, 18, a senior at Hockaday, an exclusive Dallas prep school, said Toms are starting to catch on in South Korea, her home country. The school has even had a Decorate Toms Shoes Day at Hockaday, Im said. "He became like a star at our school." The dean of student affairs at Hockaday, Meshea Matthews, was also at Neiman to buy a second pair of those special Toms. "This was so inspiring because it was service, but in a hip and cool way," she said. So there you have it. A kid from Arlington takes the design for a shoe worn by peasants, moves it upscale, sells it to millionaires, gives back to children in places where they can't afford to buy footwear themselves and becomes a media darling and mogul in the bargain. Maybe it's mixing profit and charity, but Seton said that's not automatically a bad thing. "It's good for society," he said. "Maybe their founders are making some money, but at the end of the day more kids are getting shoes." To see more of the Fort Worth Star-Telegram, or to subscribe to the newspaper, go to http://www.star-telegram.com. Copyright (c) 2009, Fort Worth Star-Telegram, Texas Distributed by McClatchy-Tribune Information Services. For reprints, email [email protected], call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. |