Is the BOGO model dead?
The Buy One Give One business model was hugely popular a decade back. It seamed like a great idea. A great way to diminish consumer guilt. A great way to create differentiation. A great way to make customers feel doubly happy with their purchase. Warby Parker, State Bags, Baby Teresa and many others adopted the model but it was TOMS shoes, with its rapid growth, that became the “poster boy” for the whole movement.
Things were going well with the model until a few stories started to creep in with click bate titles like “SHOE COMPANY DESTROYS LOCAL JOBS”. Stories suggesting that BOGO was harming local economies where its free shoes were being distributed. On closer reading there appeared to be a lot of conjecture and anecdotal evidence in these stories. Talk that the shoes “might” harm local company, interviews with locals who were “worried” about jobs but no actual evidence. They were mostly beat up stories that were either looking to discredit the movement or simply chasing clicks.
In truth it’s not an ideal, sustainable long term solution. Giving shoes to someone who can’t afford a pair is a wonderful thing to do but creating an economic system where people are dependant on BOGO shoes is not desirable. A lot of care and attention needs to be taken to ensure that there are no negative long term impacts. Recipients and their needs have to be carefully evaluated.
TOMS did well to find lots of other people who desperately needed shoes and had no alternative, giving new shoes to children in Refugee Camps. It also started manufacturing in some of the areas that received the shoes too, to help build the local economy and to deflect criticism of the BOGO Business model.
Fast forward 10 years and they have now changed their model. While TOMS will continue with its BOGO scheme it has decided to add other charitable activities. They say it’s part of their ongoing philosophy of “always questioning, are we having the greatest impact possible?” If you buy TOMS Roasting Co beans, you’re supporting community-owned water systems in areas that lack safe drinking water. Toms sunglasses can support cataract surgery and not just a free pair of glasses. BOGO is now one part of their purpose mix but no longer the only driver.
TOMS is not the only company to make this change in fact most of the old BOGO companies are offering different ways of giving back. Warby Parker does donate glasses, but it also trains people globally to perform basic eye exams and sell glasses for “ultra-affordable” prices. It appears that similar lessons are being learnt.
What matters most for these purpose driven companies is to ensure that their “impact” is strongly tied to their brand and what they do. There needs to be a direct correlation between product and purpose to help the Brand stand out and to ensure it feels authentic.
BOGO is not dead but a bit of the gloss may have gone.