Buy-One-Give-One: Not Always As Generous As It Sounds
The following guest post was written by Chad Hamre, founder and CEO of Ethical Ocean.
There was a time when ‘BOGO’ was all about what you get – a free pair of shoes, cup of coffee, a shirt. These days, the acronym loved by marketers has been transformed to be more about what you give.
TOMS Shoes popularized the model in which for every pair of shoes purchased, a second pair is donated to a child in need. Scores of other consumer brands have followed suit, making it easy to donate blankets, flashlights, soccer balls, and rain boots when you shop.
It’s hard not to feel great when you buy BOGO making someone’s life better in some way. Or is it?
A dispute rages on about whether BOGO brands are actually doing good. Last week I published a story about how TOMS Shoes does more harm than good by distorting the market for locally-produced shoes in communities where they donate. Besides, shoes are simply a Band-Aid solution – once they ware out, those kids face the same health risks as before.
But, I’m not ready to dismiss BOGO all together. There are in fact some instances in which the buy-one-give-one model can do good. Here are three questions you can use to evaluate a brand’s social impact.
- Is a local market already established? When a local market exists for a product like shoes or soccer balls, freebies undercut local prices, hurting local manufacturers and retailers who earn a living from those products.
- How deep is the production chain of the BOGO company?Socially-minded companies can increase their impact by moving all or part of their supply-chain to the communities they intend to benefit. Sourcing materials and manufacturing can go a long way to creating jobs and transferable skills.
- Is the product solving a root-cause problem? Often freebies provide temporary relief but do little to address the root-cause of the problem they intend to solve. In Zambia I saw countless mosquito nets given out to help fight malaria, but I also saw many of those nets used for fishing rather than warding off mosquitoes.
When I ask these questions of the most popular BOGO brands, most fail to produce social impact. An exception however can be found in the BOGO brands that are newly disrupting the eyewear industry. Eyewear company Warby Parker grew at 500% last year through their BOGO program and TOMS recently expanded their line to include sunglasses.
When it comes to social impact, TOMS does a much better job with glasses than they do with shoes. For every pair of glasses TOMS sells, they give “site” not “glasses” to someone in need. They partner with local non-profits to provide complete eye care, including eye exams, medical treatment, surgery, and prescription glasses if needed. Eyewear markets are hard to come by in rural areas of developing countries, creating a unique opportunity for TOMS to help equip kids with vision problems so they can succeed in school.
While this example shows there is promise in the BOGO model, we cannot romanticize BOGO for being more than it is. Free stuff will only do so much. As consumers we have a responsibility to look beyond feel-good marketing and understand the real implications of what we give – often it might not be worth feeling good about.
Chad Hamre is the founder and CEO of Ethical Ocean, an online store for eco-friendly and fairly made products. Chad has spent a decade working in international development based both in Zambia and the Philippines with Engineers Without Borders.