1.

0 Executive Summary
TOMS is nothing like other shoe companies. It prides itself in matching the generosity of its customers by giving shoes to fifty communities in need around the globe. With over two million pairs of shoes having been given to children in TOMS shoe drops, the company has been able to aid children in receiving an education and reaching their dreams and potential. An enormous amount of people buy TOMS shoes; they do so with the knowledge that for every pair bought by a customer, another pair will be given to a child in need. The demand for TOMS is growing rapidly. The amount of shoes that have been bought from TOMS has increased in leaps and bounds with over 140,000 pairs having been sold in 2009. TOMS customers are proud to be a part of its cause as exemplified in the 2011 One for One campaign: And for the simple fact that young adults (TOMS main target market) love trying new things. TOMS is a vegan friendly and green company which appeals to our young customer base but also to our environmentally aware consumers. It interacts with its customers and offers them a variety of products and shoe styles at affordable price levels. The public wants to see the everyday use of the shoes and also they want to see their purchase play into a larger, more global cause. Marketing helps play a role in TOMS success. Now that TOMS has had over six years to mature and gather a large following, many people around the globe have noticed TOMS and heard of its mission. With a positive and customer oriented public image, TOMS customers are willing and desire to buy its shoes not only for their own needs, but for the betterment of the communities that shoes are given to. This desire to better the globe is what gives value to TOMS who provides customers with a purposeful and meaningful product. It is what has allowed TOMS to compete with other high quality casual shoe brands like Converse and Vans but maintain its giving nature which was not found in the market beforehand. Future TOMS marketing will emphasize: building customer loyalty, increasing sales and customer demand, building awareness of the TOMS brand and mission, gaining more knowledge of TOMS customers, and increasing the number of countries that TOMS gives to. In 2010 TOMS gave away its millionth pair of shoes to a child in need. It is the hope of TOMS that through expansion and forward-thinking planning that over five million pairs of shoes will be given in the next three years. In the spirit originated by TOMS creator Blake Myocoskie, TOMS would like to see the generosity of its customers exceed expectations causing the company to blossom into a global competitor in the casual shoe industry.

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2.0 Situational Analysis

TOMS began in 2006 and has seen an increase in profit since then. TOMS has differentiated itself from other shoe brands because of its philanthropic mission. With every purchase, TOMS gives a child in need a new pair of shoes. This is a unique way for customers to be fashionable and philanthropic. The target market has generally been children, teens, and young adults. Also, TOMS has targeted towards those environmentally conscious and those seeking ways to help change the world. The shoe design is distinct and different from any shoe in the industry yet casual and comfortable. It is crucial TOMS keeps up with marketing strategies to keep spreading awareness, increase profitability and move further away from any future competition. 2.1 Market Summary There are two main, broad target market groups for TOMS Shoes. The first group would be the more environmentally conscious people and those looking to make a difference in the world. This group includes people who are concerned about what goes into the making of the shoes, how the environment is affected, and the social problem that is the driving force for the product. Many customers want to know their money is going to a good cause, but may not necessarily trust that their money is actually helping in the way that they intended. With TOMS, customers can be guaranteed that shoes will be donated to people in need. The second group is the fashion conscious. Shoes have become a great way to make a statement in the fashion world. People will go to great measures to wear stylish shoes for any occasion, regardless of the price. TOMS have become a recent fashion trend across the world. The market for shoes is expected to grow and evolve around the latest fashion trends and fads. There are many different shoe companies developing shoes to fit these needs, and TOMS plans to continually improve their shoe product. There will always be a need for shoes in the market, and increase in living conditions and economic conditions around the world will mean more and more people wanting shoes. 2.1.1 Market Demographics Within these target market groups, TOMS focuses on specific demographics to narrow down to a specific group of customers. The primary focus is on both men and women ages 18-29 and then children and teens ages 13-18. The shoes are sold at a reasonable price, so that anyone can afford them. The target customers are Caucasian college students and single adults who are media and fashion savvy and involved in social causes. College students and newly employed young adults live a fast-paced lifestyle and are constantly on the go; therefore, they need a comfortable everyday shoe that can be a staple in their wardrobe. College students are seen as the primary target because they have the ability to trend the shoes and create popularity in the fashion world via social media. They are targeted as loyal and repeat customers. They also have
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the ability to influence others to wear them, including the younger, secondary target group, who is seen as the future generation of TOMS Shoes. Young adults are also believed to be apt to trying new things and are very active in the new Going Green movement. TOMS also tries to target the emotional side of these people through its One for One program, as this allows for customers to make a difference in the world. People are looking to purchase a purposeful product. It is also known that the older demographic of middle class citizens in TOMS target market are more likely to donate to charities. 2.1.2 Market Need There will always be a great demand for shoes, as shoes are worn every day for many different purposes. The current shoe market does not have any other shoe company like TOMS. The market lacks a shoe that consists of quality, fashion, individuality, comfort and a low price combined with an emotional satisfaction of helping those in need. The humanitarian aspect of the market is something that has never been targeted before, and is something that will always exist. People will always have a conscience and a deep need for wanting to help out social causes. Buying shoes and helping solve a social issue have not been effectively combined into one product or company before. There is a need in the market for people to feel confident and happy with their purchase of a pair of shoes. 2.1.3 Market Trends Worldwide trends include increased internet use, an increased sense of fashion and trends, and an increased passion for helping others and donating to a greater social cause. Specifically in the market of young adults and teens, there are trends in blogs, an importance on customer service, and a desire to express oneself. This target market is increasingly becoming more dependent on blogs for fashion and technology information and recommendations. About 28% of men and women in this target market are bloggers. As for customer service, young adults are twice as likely as other adults (10.3% vs. 5.3%) to say that customer service is the most important factor when making a purchase. This desired target market has also begun to forge their personalities: being confident, up-beat, self-expressive, liberal, and open to change. More and more people are looking to donate to charities and help people in need. The Go Green movement is becoming very popular in this market group, and any sustainable options are being considered when developing a product or running a business. 2.1.4 Market Growth Market growth in the shoe industry is projected to rebound as consumer confidence builds in the post-recession economy. Global market for Footwear is projected to reach 15.7 billion pairs by the year 2017. Growth will be primarily driven by growing world population, expanding base of middle class consumers, rising standards of living, increasing household

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income and per capita spends. An increasing amount of people will be needing shoes, especially in world markets in Europe and Asia. 2.2 SWOT Analysis

Strengths Customizable to customer wants Very good brand message (One for One) Reasonably low price combined with quality Environmental conscious Charitable company Proven and consistent market Motivated and creative staff and management Shoes are fashionable with current trends

Weaknesses
Young and small company Limited advertising and media exposure Possibility of hurting the local companies in shoe

drop communities and preventing local employment Shoes are produced in only three countries; China, Argentina and Ethiopia Poor customer service reviews about poor quality and high price Lengthy shipping process and time Not available at many retailers Threats More establish competition with better quality and loyal customer base Too many companies in casual shoe industry Poor consumer perceptions of TOMS Growing dependence on word of mouth and social media for exposure Competitors copying the TOMS concept and offering similar products at lower prices

Opportunities Large and growing potential markets Rise in green movement and social causes Non-traditional stance on market. Expand marketing to commercials and magazines Increasing global use of internet and online shopping New distribution channels Increase in ethical decision making on a global scale

2.3 Competitive Analysis TOMS and its competitors have created casual footwear with medium to high quality in the medium to high price range with prices ranging from $35 for a pair of BOBS to $100 for a pair of Converse. TOMS three main competitors are BOBS, Keds, and Vans. Each provides a similar casual shoe of similar quality. The test comes in finding a company's strengths to put it above the rest.

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Keds Strengths: Keds is a well known and established brand trusted by many people. They sell a wide variety of shoes for everyday casual wear. They are sold in most shoe stores and department stores like Macys and Sears. Weaknesses: This brand is sometimes seen as old fashioned. They are relatively cheaply made with a plastic sole. Matchup: Both TOMS and Keds offer a similar quality shoe, but Keds provides them at a slightly lower price. TOMS, however, provides the opportunity for their customers to feed their inner philanthropist. BOBS Strengths: BOBS provides a customer with a casual shoe for a relatively low price and decent quality. They also provide two shoes to children in need for every pair sold. It offers a variety of colors and designs for a basic designed shoe. Weaknesses: BOBS are often seen as simply a knockoff of TOMS. They only sell shoes for women and children. Very little promotion has gone into BOBS. Matchup: Both BOBS and TOMS provide a similar shoe with a similar charitable dimension, however the charity by BOBS is often seen as lesser because it lacks the story that TOMS provides. Vans Strengths: Popular with skaters and is a well established brand available in a variety of styles and in most shoe stores. Weaknesses: Vans is often seen as a skater shoe. Matchup: TOMS is a relatively young company compared to Vans, however its newness is seen as refreshing to some. TOMS also provides an additional shoe to a child in need, which Vans does not.

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2.4 Service Offering Provides casual footwear for everyday use, while allowing customers to feed their philanthropist side through the One for One program. With every shoe purchase one pair of shoes is given to a child in need. Shoes can be purchased online or in various shoe stores. International shipping is available. Shoe styles include Classic Canvas shoes, Botas, Cordones, Stitchouts, and Vegan. TOMS also offers Apparel and Accessories like t-shirts, sunglasses, bracelets, and wallets. 2.5 KEYS to Success The simplest and most important key to success is to stress the notion that TOMS is an organization that is dedicated to helping children that are in need. TOMS must continue to portrays itself as a movement, so that people are willing to buy the shoes for the benefit of the children. Design of the shoe. TOMS chooses a simple but trendy style based on the Argentine alpargata shoe. Customers need to be drawn to the style of the shoe and admire its minimalist yet fashionable design. Awareness. A goal of TOMS is to raise awareness for children who have to walk around each day without anything to wear on the feet. Raising awareness will help the children in need while increasing profit for TOMS. Price is a factor. Because TOMS is donating a pair of shoes for each pair sold, the price of shoes needs to be such that it is affordable to fund the One for One movement.

2.6 Critical Issues Q. How can TOMS follow through with its humanitarian goals while simultaneously making a profit? A. Price level is a concern here. TOMS needs to keep its prices higher than ordinary shoe companies because of these humanitarian goals. Competitors may be able to offer a similar shoe at a lower price than TOMS. Because of this, the company needs to reach out to customers who are sympathetic to the goals of TOMS and realize the benefit for the children receiving shoes. Without slightly higher prices, these goals would not be able to be reached. Q. How can TOMS get people involved and spread awareness for their campaign? A. TOMS needs to continue programs like One Day Without Shoes and its campus programs in order to get people involved. TOMS has several campus clubs on campuses such as New York University, Ohio State, and the University of Michigan. TOMS has had success in the past working with college and high school age students and needs to continue to reach out to these groups Q. What can be done in order to lower the companys fixed costs?

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A. Currently, TOMS is producing its shoes in factories in both China and Ethiopia, and Argentina. In the future, TOMS could potentially build more factories that would decrease shipping and manufacturing costs. Q. In the future, what can TOMS do to maintain support for underprivileged children from its current customers? How can TOMS retain customer interest in the style/designs of the shoes? A. TOMS must continue to be innovative if it is to be successful in the future. The only way for the TOMS movement to continue is if people continue to buy shoes. TOMS must be able to keep up with the changing trends in the casual shoe industry and continue to spread its message of helping those who are impoverished. 2.7 Porters 5 Forces Power of Buyers - Highthe customer has a good amount of control in the shoe industry because there are some many different options to choose from. The buyer can purchase their shoes from many different competing firms at many different price levels. Power of Suppliers - Power of suppliers is low to moderate in the footwear industry. Firms can choose whether to manufacture their products domestically or to outsource, giving the most footwear companies the advantage. Barriers to Entry - Barriers to entry in the shoe industry are low to moderate. There are few laws or regulations that would impact an entrant. Much of the industry is based off current trends, which opens up space for newcomers to take the place of a sinking competitor. If a company can develop a fashionable and trendy shoe, it can find success in a seemingly mature market. Start-up capital is the biggest issue in the shoe industry, with labor and capital costs high to a new company. Substitute Products - The threat of substitute products in the footwear industry is low. Potential products that could be considered as substitutes for shoes would potentially be boots, sandals, clogs, heels, etc. Most people who own these substitutes have at least one pair of shoes that they wear casually. While there is no clear substitute for shoes, there are many alternative brands and styles of shoes that consumers can choose from when making a decision to purchase footwear. Rivals - In the footwear industry, competition among rivals is high. With many competitors in the market and many different styles, price remains a big factor in this environment. The footwear industry can be broken down into several groups, such as athletic footwear, casual footwear and dress footwear. Each of these groups are competing within each other for customers.

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2.8 External Environment Economic: United States total footwear sales grew 3% in 2012, with total dollar sales over 54 billion. Job growth and lower taxes are helping Americans keep up with an increase on spending. An improving labor market has contributed to boosted spending. These economic forces and a new strategic plan will likely boost TOMS sales in the next few years. Competitive: TOMS competition consists of mainly casual footwear companies. See 2.3 for an analysis of TOMS competitive environment. Technological: Technology is playing an increasingly important role in the retail industry. While TOMS has a well-established digital presence, larger stores are recognizing the positives of online availability and increasingly carrying out discount coupons or promotional codes. It is not ideal for TOMS to discount their products, therefore innovative ways to reach the consumer are essential. Political and Legal: An increased tax rate could potentially hurt TOMS sales. If the sales tax was to increase, consumers would be less inclined to spend their money on TOMS products. Cultural and Social: Demographic forces could potentially have a negative impact on TOMS. TOMS is reasonably priced but does have competitors that offer cheaper prices. If income levels were to drop TOMS would most likely see a decline in sales. If income levels are decreasing, consumers will have less money to spend on products such as TOMS. Certain cultural aspects may help TOMS sales. Todays culture features a growing green movement, which benefits TOMS because of its commitment to the environment. A culture of those who wish to give to the poor also exists and has been helping TOMS with its success. Lastly, TOMS shoes fit in with the current fashion culture, as it has been featured at many fashion shows and displays. The cultural environment that surrounds TOMS can continue to increase profit.

2.9 Macroenvironment The footwear industry consists of many manufacturers, wholesalers, and retailers. The range of competitors is very large, from large multinational companies to small local businesses. The industry can be further divided into subgroups. Because of the uniqueness of the One for One strategy, TOMS falls into a niche market that makes up approximately 30% of the shoe industry. This is a rapidly changing environment with many new competitors and styles of footwear. Many of the other niche footwear products are boom or bust styles that gain quick success or flop.

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3.0 Marketing Strategy

TOMS three main strategies is to add convenience and variety, increase brand awareness, and to expand to new target markets. These strategies will help keep the company at a competitive advantage with competitors. Adding convenience will keep employees up to date with the companys endeavors, increase production, and produce new shoe designs to keep up with current fashion trends. Increasing brand awareness will help with the companys overall mission of helping those in poverty and spreading the word to those uninformed of the problem. Expanding to new target markets is needed to increase companys sales and again help spread the mission of TOMS. TOMS also hopes to keep connecting with customers through their annual of events that are the Shoe Drops and One Day without Shoes. 3.1 Mission Statement TOMS has a very simple and humanitarian reason for existence. For every pair you purchase, Toms will give a pair of new shoes to a child in need. One for One. Why Shoes? Many children in developing countries grow up barefoot. Whether at play, doing chores or going to school, these children are at risk: A leading cause of disease in developing countries is soil-transmitted diseases, which can penetrate the skin through bare feet. Wearing shoes can help prevent these diseases, and the long-term physical and cognitive harm they cause. Wearing shoes also prevents feet from getting cuts and sores. Not only are these injuries painful, they also are dangerous when wounds become infected. Many times children can't attend school barefoot because shoes are a required part of their uniform. If they don't have shoes, they don't go to school. If they don't receive an education, they don't have the opportunity to realize their potential. Children grow out of shoes every six months on average, therefore TOMS strives for repeat giving 3.2 Value Proposition Now that TOMS has had over six years to mature and gather a large following, many people around the globe have noticed TOMS and heard of its mission. With a positive and customer oriented public image, TOMS customers are willing and desire to buy its shoes not
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only for their own needs, but for the betterment of the communities that shoes are given to. This desire to better the globe is what gives value to TOMS who provides customers with a purposeful and meaningful product. It is what has allowed TOMS to compete with other high quality casual shoe brands like Converse and Vans but maintain its giving nature which was not found in the market beforehand. TOMS really focuses on providing value to the customer to ensure customer satisfaction and lifelong sales. Without this added value, TOMS would not be as successful of a company as it is now. 3.3 Customer Experience TOMS wants their customers to not only receive a fashionable pair of unique shoes, but to also be satisfied with helping solve a greater issue at hand, poverty. The one for one movement is about allowing people to make the everyday choices that improve the lives of all children across the world. TOMS wants to allow for their customers to have an impact on childrens lives through their purchase of shoes. The biggest thing TOMS wants to deliver to the customer is satisfaction through humanitarian efforts. This is accomplished through the one for one movement and TOMS Giving Trips. Shoes are a fundamental resource for protecting childrens health and providing them with opportunity, and it is important to TOMS to allow for the customer to see the impact their purchase has had. With the Giving Trip, customers experience how powerful it can be to handplace shoes on childrens feet and gain an understanding of how TOMS Shoes are integrated into the Giving Partners larger development programs and goals. Customers are wanted to be a part of the company wide plan and experience it first-hand. Another way in which TOMS focuses on customer experience is through the One Day Without Shoes campaign. With this campaign, the strategy is to implement a process; a process designed to arouse curiosity, beginning the conversation necessary to provide the action that will ensure change for children in need. Shoes can have a great impact on a persons life, and this is used to raise this awareness. This yearly occurrence encourages customers to ditch their shoes for the day in order to spread awareness of the impact a pair of shoes can have on a child's life by taking off their own. This uses direct customer and community participation in experiencing what these barefoot children go through on a daily basis. TOMS is all about allowing for the customer to witness and experience their company movement firsthand. 3.4 Marketing Objectives TOMS marketing objectives for the next three years of operation include:

Build customer loyalty. Increase sales and customer demand.

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Continue to build brand awareness and expand the company. It is important to expand across the United States and move away from the current primarily west coast operations. It would be ideal to open stores and warehouses across the country, especially on the east coast where there is an abundance of middle class citizens. Gain customer knowledge of the One for One movement and the companys mission Increase the number of countries in which TOMS donates shoes to.

One way to accomplish the majority of these objectives is to increase advertising efforts to more traditional measures (television, radio, billboards, and magazines). Interaction on the current website is outstanding, but awareness of the company needs to be increased to get people to visit the site and participate in the cause.

3.5 Financial Objectives To achieve customer loyalty TOMS target number would be to increase repeat customers by 15% each year. To increase sales and customer demand, the target would be an increase in annual sales by 25%. While attempting to expand the company and build new retail stores across the nation, TOMS expects for an increase in profit of $100,000 for each TOMS store built. TOMS would like to build its way up to 5,000,000 shoes bought and donated to children in need. While attempting to increase the amount of countries the company donates shoes to, this may bring a cost of up to $80,000 per country.

3.6 Target Marketing TOMS target market includes college students, middle class young adults, and young teens (both men and women). Much of this information can be found in section 2.1 Market Summary. With these groups of people in mind, TOMS strategically breaks this down into two specific target groups within in each demographic; people who want to purchase a purposeful product and those who want a fashionable shoe. 3.7 Positioning Presently TOMS is in a position with decent quality at a medium to high price, however we hope to grow in size and create a higher quality shoe. TOMS isnt just a shoe, its a lifestyle and the more people involved, the larger it will grow. Currently, TOMS has a role in student run organizations in High Schools and Universities. They provide customers with TOMS swag and the satisfaction that they can make a difference by simply purchasing a pair of shoes. By creating new

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3.8 Strategy Pyramids

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3.9 Marketing Mix TOMS balances its marketing mix of product, price, promotion and place to service its customers while maintaining its good cause. Classic TOMS, styled after the Argentinean shoe the alpargatas, is a functionable style that can be designed and customized by the consumer while still maintain a high level of shoe quality. TOMS carries a variety of shoes at multiple price levels so that consumers from every income level, not just the TOMS target market, can order and wear TOMS. With word of mouth and social media being the main forms of TOMS

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promotional materials it is imperative for TOMS to focus on expanding its promotions and expand the amount of retailers so as to better meet the demands of its customers. 3.9.1 Product As TOMS shoes are already enjoyed by our customers as they presently are, TOMS will not dramatically change the products. We offer a variety of shoes and change the available styles and designs on a relative annual basis while maintaining our high quality and function. When a customer buys one pair of TOMS, not only do they receive the shoes that they personally selected but they also receive a TOMS sticker and flag. The selection of TOMS shoes that customers have to choose from range from wedding shoes, shoes made with Vegan materials, crocheted shoes, glitter shoes, sandals, classic TOMS and work boots. 3.9.2. Price To accompany our variety of shoes TOMS has various price levels. Our childrens shoes, labelled Tiny for children under 5 years old, and Youth, for children above 5 years old, can begin at $20 with an end price, sans shipping, being $39. Mens classic TOMS begin at $44 with the most expensive ending up at $140 for work boots. Womens classic TOMS start at $44 and slowly escalate in price. Wrap boots, which cost $98 and wedges, which cost $140, are our most expensive womens items. Although prices may be more expensive than our competitors, such as Sketchers, the aim of TOMS is to have our customers realizes that they are essentially buying one pair of TOMS and are then giving another to someone in need for free. We want our customers to feel as though they are a part of TOMS and that they themselves are the root cause for the betterment of the globe. 3.9.3. Promotion The goal of TOMS promotion is to expand the TOMS message and increase the awareness of our mission. Future TOMS promotional materials will include using social media tools (such as Facebook, Twitter, and Tumblr), the TOMS international blog, direct mailings to customer and to potential customers that existing customers refer, and advertisement in selected paper media (magazines, etc). Competitions for shoe designs will also be offered with the top 5 or 10 winners receiving a free pair of their own design, and voted on by TOMS customers. A large focus of promotion will be on social media as it is a more environmentally friendly and reaches more people. 3.9.4 Place Seeing as how the TOMS shoe brand manages a unique image it is imperative to remain very selective about our distributors. Eventually it would be beneficial of TOMS to create various retail locations however this would need to be tested in select retail stores so as to better gage the interest level in TOMS. We are aware that certain retailers, like Journeys,

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Nordstrom and Whole Foods, sell TOMS to their customers and that the profit from these sales is fairly stable. As our image is mostly managed online TOMS will maintain our online catalogs, interactive websites and high electronic presence as well as special events, such as the One-forOne event launched in 2011. 3.10 Customer Service TOMS plans on continuing to the best of its availability to serve our customers. With various telephone numbers to call as well as email and instant messenger contacts TOMS intends to exceed customer expectations with our customer service. TOMS also answers customer questions on our Twitter account as well as other social media pages. In the future TOMS plans to expand the hours in which customers can call to a 24/7 service as well as available 24/7 live instant messenger chat. 3.11 New Product Development New product development is a five-step process. These five steps include Idea generation, Screening, Idea evaluation, Development, and Commercialization. Idea generation, TOMS can come up with new ideas for their product, such as a fan or customer of their shoes coming up with Create your own for you and a child in need. TOMS then can screen the idea by figuring out what the strengths and weaknesses are, what the market trends are, and if it fits with objectives. Strengths for TOMS create your own for you and a child in need could be that people are more interested in buying if they can create their own. Weaknesses could be that it is too costly for the create your own concept and they might have to raise the prices. Then TOMS would have to evaluate the idea by testing the reactions from customers and figuring out the rough estimates of the costs, sales, and profits. TOMS could then use the feedback from customers to decide if the product would be good for the company or bad for the company. Next TOMS would Research and Develop the product or a model prototype, test the marketing mix, revise plans, and the ROI estimate. TOMS then would create a prototype of a create your own shoe and test the different marketing mixes. Commercialization for TOMS would consist of Finalizing product and the marketing plan, as well as starting the production and getting the market to start customizing their TOMS. TOMS can use these five steps to improve their product line as well as how they get their new product and Create your own toms for you and a child in need idea out into the buying market. 3.12 Sales Promotion Sales promotion is something that TOMS should utilize. TOMS can use sales promotion by referring to those promotion activities that stimulate interest, trial, or purchase by the customers. TOMS can use this to help keep their brand loyal to the customers, which in return will keep the customers to using their shoes and not buy the competitors. TOMS can use this type of sales promotion to complement other promotional methods. Sales promotions only last

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for a limited time only. TOMS could utilize this as suggested by the following example: If customers purchase three pairs of TOMS shoes from 2/30/13 through 3/5/13, there will be an extra pair donated as well as the three from your purchase. This will motivate customers to buy more and to buy throughout tough times of the year, when people usually dont wear TOMS shoes as much. 3.13 Types of Publicity Publicity is unpaid presentation and it helps gain customer trust. TOMS can use publicity to help out with their campaign. TOMS mostly will see a huge impact with online publicity. There are many teenage groups that post things on social networking sites that promote to their friends. For example, If you post something on Instagram, Facebook, or Twitter your followers or friends will look at your pictures or what you do on a regular basis through their news feed. This can help out TOMS as a whole in many ways with publicity. 3.14 Choosing the Best Medium There are three main things that the company needs to make sure that they cover when choosing the best medium. Firstly, the medium should fit promotional objectives. This means that TOM should use promotions that suit it best for what their product is and its successes. Secondly, the medium should match your market with the media. TOMS should utilize this because it will help find the target market that reaches the market the best. Lastly, TOMS should be zeroing in on specific target markets. This will help TOMS stick to the target market has bought more than once with there company. As well as it benefiting the shoes and other product that TOMS is trying to sell. 3.15 Marketing Research During the development of the TOMS marketing plan various reviews for both TOMS and its competitors such as Keds and Bobs were used to formulate an idea of what customers think of TOMS compared to what else is available in the casual shoes market. Monitoring these reviews as well as gaging pubic opinions of TOMS allows the company to alter its products, if the need arises, and to better its customer service options. These reviews provide a sort of feedback system about TOMS products and the effectiveness of its marketing mix. Reviews and other forms of feedback allow customers to be honest about their purchases as well as their purchasing influences.

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4.0 Financials
TOMS sees an increase in sales over the next three years because of recent trends in sales revenues. The marketing budget uses 1.2% of the total revenue. The more sales revenue increases, the more marketing expenses will increase. TOMS expects to to at least or more than a million pairs of shoes in each of the next three years. The marketing budget will utilize expenses towards different mediums to increase awareness of the TOMS brand. This section will also look at the monthly breakdown and the break even and profit analysis. 4.1 2014-2016 Sales and Expense Forecast The marketing expenses and sales revenues are linked together. As the sales trend upwards, the marketing expenses will increase. The marketing expenses are only a small amount, but TOMS will use and research more marketing strategies as sales increase. TOMS number one source for spreading awareness is social media, and this will always be the most used tool to reach the target market. TOMS is looking into other venture that will use much of the budget such as online advertisement and a documentary to reach other target markets and to keep loyal customers coming back. 4.1.1 2014-2016 Sales Projection Annually the revenue at TOMS has grown especially because of social media advertising the mission and this form of media reaches a large target market. Customers will help the increase in sales through spreading the TOMS story to others. TOMS has only seen a growing trend in their sales history. This is why it is plausible and realistic to see a revenue increase in the next three year. 2014 $55 Million 2015 $66 Million 2016 $82.5 Million

Sales have been trending upwards selling 1 million shoes from 2006 to 2010 and selling another 1 million shoes between April 2010 and January 2013 making their total shoe sales over 2 million. This upward trend will hopefully continue, which is how we have reached these approximation. With further improvements in technology and the ever present social media, TOMS message will spread rapidly around the world. With high ratings by customers, and the high number of loyal customers, only an increase of sales is possible. 4.1.2 2014-2016 Expense Forecast - Marketing Department The Marketing Budget makes up roughly 1.2% of the companies expenses over the next three years. Most expenses will be used through different advertising techniques to spread
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awareness and gain other target markets. This will be done through social media, online advertisements, a new web design, campus clubs, and researching other ways to be present more online. A documentary will be filmed to showcase the inner workings of TOMS and this will provide customers with a real life experience of the company. TOMS will use expenses to reinforce quality customer service and to increase production efficiency. Other expenses will be utilized towards labor and rent. Expenses Rent Labor Campus Clubs Training Staff for Efficiency Increasing Economies of scale in Manufacturings New Shoe Design Documentary Increase Online Presence Research Possible Target Markets Online AD Website Design Design Issues Increase Advertising Total 771,500 2014 $30,000.00 $600,000.00 $10,000.00 $10,500.00 $85,000.00 2015 $30,000.00 $600,000.00 $10,000.00 $50,000.00 2016 $30,000.00 $600,000.00 $10,000.00 Total $90,000.00 $1,800,000.00 $30,000.00 $10,500.00 $125,000.00

$1,000.00 $35,000.00 -

$10,000.00 $40,000.00 $11,000.00 -

$100,000.00 $2,200.00 $10,000.00

$11,000.00 $175,000.00 $13,200.00 $10,000.00

$50,000.00 $1,000.00 $10,000.00 812,000

$85,000.00 $15,000.00 852,000

$85,000.00 $65,000.00 $1,000.00 $10,000 $2,435,700.00

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Explanation of Major Marketing Expenses: Online Advertisements: TOMS will spend money on advertisements that will be shown online only through major television watching sites such as HULU. The goal is to reach another target market through this venture and to increase the presence online through a different medium. New Website Design: This expense will keep the company fresh and up to date creating an always exciting and fun atmosphere within the company. Customers will see that TOMS is always up with the trends and not going out of style. Training Staff for Efficiency: TOMS will keep a fixed amount of spending that goes towards campus clubs annually. The goal is to get more campuses to have clubs that will spread the TOMS mission and to work directly with the target market. Documentary: This will be filmed to showcase the inner workings of TOMS and will show footage of the shoe drops. This will provide new and returning customers a real life personal feel of the company along with spreading awareness of the ultimate mission. The goal is to reach many different target markets and for current customers to feel even more involved with the company. Customers Service: An expense will be put towards customer service training initiatives. TOMS hopes this expense will provide even better quality service, and to keep their employees more up to date with information making them more knowledgeable. This will help to keep customers satisfied and feeling they can come to TOMS if any issues arise. In return, the customers know they will receive quality and helpful feedback. Increasing Economies of scale in Manufacturings: Expenses will be put towards ways to increase production efficiently as more goods are being produced. This will help keep operations running smoothly and help meet customer demands. Labor: Most of the expenses are put towards labor. For the marketing managers to do an efficient job they receive a higher salary to perform the specific tasks that promote TOMS. 4.2 Monthly Breakdowns The monthly breakdown of sales reveals greater sales during the Christmas holiday season as well as higher sales during the summer months. The monthly breakdown of expenses reflects the costs of the project implementations and the promotion implementations as well as the costs of rent, labor, etc. The numbers show an increase in TOMS expenses but we also expect an increase in TOMS sales over the next three years.

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4.2.1 Monthly Breakdown of Sales Jan

2013

Feb

Mar

Apr

May

June $7.5 Mil $8.5 Mil $10 Mil

July $ 7 Mil $8 Mil $10 Mil

Aug $ 6 Mil $7 Mil $9 Mil

Sep

Oct

Nov

Dec

Total $ 55 Mil $ 66 Mil $82.5 Mil

$ 6 $ 4 $ 2 Mil Mil Mil $ 7 $ 5 $ 3 Mil Mil Mil $ 7 $ 5 $ 3 Mil Mil Mil

$ 2 $ 4 Mil Mil $ 3 $ 4 Mil Mil $ 3 $4.5 Mil Mil

$ 2 $2 Mil Mil $ 3 $3 Mil Mil $ 3 $3 Mil Mil

$4.5 $ 8 Mil Mil $5.5 $9 Mil Mil $ 6 Mil $19 Mil

2014

2015

4.2.2 Monthly Breakdown of Expenses Jan

2013 2014 2015

Feb 66 thou 54 thou 60.9 thou

Mar 66.5 thou 54.3 thou 80.9 thou

Apr 61.5 thou 54.3 thou 80.9 thou

May June July 62.7 thou 49.3 thou 72.5 thou 62.1 thou
181.8 thou

Aug 63.7 thou 61.8 thou 67.5 thou

Sep 67.5 thou 67.8 thou 67.5 thou

Oct 57.5 thou 69.3 thou 67.5 thou

Nov 57.5 thou 54.3 thou 55.9 thou

Dec 57.5 thou 54.3 thou 55.9 thou

Total 771.5 thou

60.3 thou 49 thou 60 thou

88.7 thou 61.8 thou 92.5 thou

812 thou 852 thou

90 thou

4.3 Break Even Analysis The total fixed cost (TFC) is the sum of all the project implementations, the promotion implementations and the expenses of rent, labor, etc. The total variable cost (TVC) is the cost of all the expenses that go into producing the shoes. The cost to produce one unit (pair of shoes) is roughly $8. In order to break even TOMS would have to sell 4 million units over the next three years in order to make the required $31.5 million in three years. This is a reasonable goal because TOMS has sold half a million in a year, so if we can increase the sales then we can achieve 4 million in three years.

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TFC = 2.5 Mil TVC = 29 Mil $8 = 1 Unit

4.4 Profit Analysis TFC = 2.5 Mil TVC = 29 Mil

$8 = 1 Unit

TOMS would need to sell roughly 4 million units to break even, so all sales after that would go towards profits. Our target goal in profits would be $15 million which would require TOMS to sell around 6 million units. This would require sales to triple what they have been in previous years. We intend to increase the sales to this level through the implementation of the TOMS documentary and other marketing ventures and we should be successful with the already growing sales in TOMS. We expect to have $55 million in sales in 2014 and we expect that to keep growing over the next two years. The expected $55 million already exceeds the goal of $45 million and the implementation of new marketing strategies will get TOMS there. We plan to increase overall advertising and to implement new ways of reaching our target market as well as possibly getting new customers.

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 TOMS will start advertising online through Hulu which will also spread awareness of TOMS to other potential customers. This will also increase the presence of TOMS on the internet. A new website design will be developed so that TOMS maintains the youthful, fresh look that appeals to the younger target market. Donating to campus clubs allows TOMS to work directly with the target market. Also by providing campus clubs with discount prices on shoes it allows the campus clubs to promote TOMS on campus, to the businesses and neighborhoods around campus, and the hometowns of the students who buy shoes on campus. TOMS will also be working on a new shoe design that should encourage current customers to buy more and entice new customers. TOMS will use the Facebook page to help get ideas for the new shoe design. Getting feedback and ideas from customers will make them feel more involved in the creation of the new shoe which will make them more likely to buy them and promote the shoes themselves. The documentary will allow current and prospective customers to see an actual shoe drop and become more familiar with the company, the mission of the company, and the creator of the company, Blake Mycoskie.

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5.0 Controls
The goal of this section is to make all of the goals, strategies, and programs outlined throughout this plan a reality. Throughout 5.1 TOMS dreams are realized through continued effort and implementation of these milestones. Between the years 2014 and 2016 each of the strategy pyramids are achieved and will build upon the image already in place. This strategy will bring the name TOMS to mind in every casual shoe consumer. We have also outlined contingency plans in case all does not go well. With proper management and skill, TOMS will grow in sales and expand its consumer base 5.1 Implementation Milestones The main goal of this section is to implement TOMS strategies in the most effective ways. The milestones and key dates create a structured plan for this marketing plans completion and success. Success and failure can be determined by the completion of each milestones and their desired results. These charts can be referred to throughout the marketing process to make adjustments and address issues that may come up. 5.1.1 Project Implementation Milestones Between 2014 and 2016 TOMS aspires to expand convenience and variety, brand awareness, and to new markets. By implementing these milestones, we are confident these goals will be met. 2014 Project Implementation Milestones 1. In 2014 we are going to focus on adding convenience and variety to our already established consumer base. Through research and training we will be able to provide expert assistance to ensure customer needs are met and through research we will be able to increase production so as to guarantee the customer receives their order on time. In addition we will create a wider variety of shoes to our customers by hiring new designers and allowing the customer to create their own designs on Facebook. 2. Horizontal Bar Chart Milestones Create Corporate Literature Train Staff Jan 14 Feb Mar 14 14 Apr 14 May 14 Jun 14 Jul 14 Aug 14 Sept 14 Oct 14 Nov 14 Dec 14

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Coaches Train Staff Research Production Technology Skills Labs Hire Designers Design Promo on FB Documentary Hire Director 3. Detailed Table Milestones Start Date End Date 01/31/2014 02/28/2014 03/31/2014 06/30/2014 Budget $500 $5,000 $5,000 $80,000 Responsible Doug Piwinski Doug Piwinski Staff Peter Ferrer

Create Corporate 01/01/2014 Literature Train Staff Coaches Train Staff Research Production Technology Skills Labs Hire Designers Design Promo on FB 02/01/2014 03/01/2014 01/01/2014

05/01/2014 02/01/2014 03/01/2014

08/31/2014 03/31/2014 05/31/2014

$5,000 Included in Salary $1,000

Peter Ferrer HR Caitlin Coble

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Documentary Hire Director Total Budget:

07/01/2014 07/01/2014

08/31/2014

$25,000 $10,000 $131,500

Doug Piwinski Blake Mycoskie

2015 Project Implementation Milestones 1. In 2015 we want to expand brand awareness. By creating a documentary more and more people will become aware of our company and the ideas behind it. Furthermore, the marketing team will attend a conference on online marketing so as to ensure they are up to date on the latest marketing techniques. By promoting the shoe in stores, the customer will be able to identify our shoes quicker. 2. Horizontal Bar Chart Milestones Documentary Shoe Drop Filming Hire Website Designers Reformat Website for appeal and ease Conference for online marketing Hire more marketing team members Promote Shoe in store Jan 15 Feb Mar 15 15 Apr May 15 15 Jun 15 Jul 15 Aug 15 Sept 15 Oct 15 Nov 15 Dec 15

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3. Detailed Table Milestones Documentary Shoe Drop Filming Hire Website Designers Website Reformatting Conference Hiring team Start Date 02/01/2015 05/01/2015 06/01/2015 09/25/2015 05/01/2015 End Date 05/31/2015 04/30/2015 06/30/2015 09/30/2015 09/29/2015 07/31/2015 12/31/2015 Budget $25,000 $15,000 Salary $50,000 $1,000 Salary $10,000 $101,000 2016 Project Implementation Milestones 1. In 2016 we hope to expand our marketing to new target markets. Through research and focus groups we will create an idea of how this new market will receive us, as well as how to best market TOMS to them. 2. Horizontal Bar Chart Milestones Research new possible markets Focus group Create online Ad 1 Jan 16 Feb 16 Mar 16 Apr 16 May 16 Jun 16 Jul 16 Aug 16 Sept 16 Oct 16 Nov 16 Dec 16 Responsible Doug Piwinski Jessica Shortall HR Caitlin Coble Doug Piwinski HR Liza Doppelt

Promote shoes in 09/01/2015 store Total Budget:

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Create online Ad 2 Create Flyer Begin TOMS Store Planning 3. Detailed Table Milestones Research new possible markets Focus Group Start Dates 01/01/2016 02/01/2016 End Dates 01/31/2016 02/28/2016 04/30/2016 07/31/2016 07/31/2016 Budget $5,000 $5,000 $50,000 $35,000 $300 $95,300 Responsible Doug Piwinski Doug Piwinski Doug Piwinski Doug Piwinski Liza Doppelt

Create online Ad 03/01/2016 1 Create online Ad 06/01/2016 2 Create Flyers Total Budget 07/01/2016

5.1.2 Promotion Implementation Milestones Through the promotions featured from 2014 to 2016 TOMS will raise awareness of the brand, provide better customer service and a new experience, and reach a new audience with new advertisements. By the end of 2016 TOMS will have become a household name in the US. 2014 Promotion Implementation Milestones 1. 2014 is a year of promoting our added convenience and variety to the already amazing customer experience. By launching new products, TOMS hopes to attract new customers and keep current customers happy. A magazine coupon will give us promotion through paper media and help customers, who may not have been able to before, afford our shoes. 2. Horizontal Bar Chart

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Milestones Implement new Customer Experience FB Design Promotion Increase production New Shoe Launch Magazine Coupon Campus Clubs

Jan 14

Feb Mar 14 14

Apr 14

May 14

Jun 14

Jul 14

Aug 14

Sept 14

Oct 14

Nov 14

Dec 14

3. Detailed Table Milestones Implement Customer Experience FB Design Promotion Increase Production New Shoe Launch Magazine Coupon Campus Clubs Total Budget: Start Date 04/01/2014 End Date 04/30/2014 Budget Responsible Doug Piwinski

03/01/2014 08/01/2014 07/01/2014 09/01/2014 01/01/2014

05/31/2014 12/31/2014 07/31/2014 09/30/2014 12/31/2014

$1,000 $50,000 $10,000 $10,000 $10,000 $81,000

Caitlin Coble Peter Ferrer Liza Doppelt Doug Piwinski Doug Piwinski

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2015 Promotion Implementation Milestones 1. In 2015, TOMS releases its documentary to raise awareness of the TOMS cause. This will also raise awareness of the brand. TOMS new website will make it easier to utilize for the optimum customer experience. In store promotion of our shoes will make the customer aware right away that they can purchase a pair of TOMS shoes there. 2. Horizontal Bar Chart Milestones Release Documentary New Website Promote Shoe in store Campus Clubs 3. Detailed Table Milestones Release Documentary New Website Start Date 06/01/2015 10/01/2015 End Date 06/30/2015 10/31/2015 12/31/2015 12/31/2015 Budget $100,000 $15,000 $10,000 $10,000 $135,000 Responsible Doug Piwinski Caitlin Coble Liza Doppelt Doug Piwinski Jan 15 Feb Mar 15 15 Apr May 15 15 Jun 15 Jul 15 Aug 15 Sept 15 Oct 15 Nov 15 Dec 15

Promote shoes in 09/01/2015 store Campus Clubs Total Budget: 01/01/2015

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2016 Promotion Implementation Milestones 1. By utilizing new media for advertising, TOMS will be able to reach new markets all over the US. Online advertisements can be seen almost all over the world. By utilizing flyers through USPS, current customers can share them with friends and family. 2. Horizontal Bar Chart - Schedule of Events Milestones Air online Ad 1 Air online Ad 2 Flyers Campus Clubs 3. Detailed Table Milestones Air online Ad 1 Air online Ad 2 Mail Flyers Campus Clubs Total Budget Start Dates 05/01/2016 08/01/2016 07/01/2016 01/01/2016 End Dates 07/31/2016 10/31/2016 07/31/2016 12/31/2016 Budget $50,000 $35,000 $2,200 $10,000 $97,200 Responsible Doug Piwinski Doug Piwinski Liza Doppelt Doug Piwinski Jan 16 Feb 16 Mar 16 Apr 16 May 16 Jun 16 Jul 16 Aug 16 Sept 16 Oct 16 Nov 16 Dec 16

5.2 Marketing Organization TOMS marketing department is headed by Blake Mycoskie, also known as the Chief Shoe Giver, rather than Chief Executive Officer. Doug Piwinski is the Senior Vice President of Global Marketing and Communications. He is responsible for public relations, social media, partnerships, influencer outreach, campus programs, events and giving. The marketing team is rounded off with Pete Ferrer VP of Sales and Marketing, Liza Doppelt VP of Product Marketing, Andy Salzer VP of Partnerships, Caitlin Coble Social Media Manager, Keith Eselman International Marketing Director, and Jessica Shortall Director of Giving.

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5.3 Contingency Plans 5.3.1 Revenue Exceed Projections If things go as planned for TOMS and we surpass our revenue projections TOMS plans on finding more communities in which to promote giving and the bettering of the quality of life. Extra proceeds would be used to create one or more factories in a few of the communities that we provide shoes to so as to teach a trade and give jobs to those who have neither. More resources and available finances would go into the communities we reach out to as well as other TOMS projects such as its eyewear and eye health campaign. It would add at least 15 communities, preferably more, to the 50 that are already receive bi-annual shoe drops. TOMS would use more promotions, such as the 2011 One-for-One campaign, in order to spread the TOMS message in a more global sphere among customers. Such interactive promotions, as the already mentioned design competition ( see 3.9.3), would be more interactive for customers and increase the enjoyment they associate with TOMS. TOMS would invest more resources back into its customers and offer more shoe styles for men and women as well as expand our available apparel. More seasonal sales would occur as a thank you to TOMS customers and more shoes would be given to children who need them. TOMS would branch out and give shoes to adults and seniors in need as well. Specific advertising firms would be hired and money would be donated to various non-profit projects whose objectives are reflective of the TOMS message. 5.3.2 Revenue Misprojections If TOMS does not meet its projections we will have to rearrange our finances. Money would be diverted from advertising and promotional campaigns in the hope that we would not have to decrease our giving or limit the amount of shoes that TOMS can give. Prices on TOMS shoes would have to be slightly increased in order to maintain our level of giving and available styles would also be limited with a restriction purchasing availability of certain styles in order to consolidate our revenue. In the worst case TOMS would have to decrease our amount of employees either temporarily or permanently. TOMS would have to close a factory and put a ceiling on the amount of shoes that are given. We would also decrease from the 50 communities that we support to 40, fewer if need be. 5.3.3 Raw Material Cost Rises Should raw material prices increase TOMS will do its best to not pass on this cost to its customers or have it affect our ability to give. Finances would be diverted from other areas, such as print media advertising, so as to compensate for these extra costs. If need be overall prices may rise but only minimally with a very clear explanation to our customers that will be available on the TOMS website.

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5.3.4 Negative Publicity If the TOMS brand begins to receive negative attention that hurts our public image TOMS will do its best to combat any unfounded negativity through more transparency. TOMS will release more documentaries and materials that display our giving process, factory worker conditions, and materials that demonstrate how TOMS has aided communities in need. 5.3.5 Negative Product Reviews If TOMS begins to receive multiple complaints and negative reviews about our products we will investigate those claims thoroughly. TOMS will apologize to the disgruntled customers and offer to compensate them for their troubles, whether that be through refunds, replacement shoes or other apparel. If the fault is found to be that of manufacturing TOMs will do its best to figure out which products were affected the most, and at which factories/distributors those products came from/are at and will correct the problems immediately. 5.3.6 Inability to Manage Customer Demand It is very possible for the demand of TOMS to overtake the ability of our manufacturers. Should this happen TOMS will add at least one more manufacturing partner, in order to manage the increased level of want and the increase level of giving. It would be preferable that this factory be in an area that TOMS is giving to so that TOMS may employ more workers or encourage the employment of workers through partnering manufacturing firms. If this new level is too much TOMS will profusely apologize to its customers and will limit the amount of shoes that can be bought within a certain time period, so as to allow our manufacturing time to catch up on orders. 5.3.7 Competitor Popularity Should one of our competitors commandeer the popularity of giving shoes that TOMS has pioneered TOMS will do its best to focus on promoting its own image as well as how effective and generous our customers are. We will use promotion materials (see 3.9.3) to attract the attention of our competitors customers and to reward our own customers for their loyalty to TOMS. 5.3.8 Late and Slows Orders If TOMS receives multiple complaints that ordered shoes are not reaching their customer destinations within two months TOMS will investigate the issue thoroughly. If the problem is in manufacturing TOMS will do its best to hurry along the process so that the desired shoes will reach their intended destinations quickly. TOMS will apologize to those customers who have not received their shoes in the allotted time and thank them for their patience with a guarantee that their shoes will be arriving shortly. If the problem is not the fault of TOMS, or our retailers and manufacturers, TOMS will do its best to aid our customers in tracking their shoe orders so as to reassure customers that they are still our priority.

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5.3.9 Fashion Trends If customers find that TOMS is not matching the current fashion trends TOMS will implement a precise feedback system in which customers are able to describe, in detail, the shoes that they would like to see TOMS produce. TOMS will continue to use canvas and vegan materials and will not change the overall shoes ( see 3.9.1) however through this feedback system, design competitions (see 3.9.3) as well as monitoring fashion trends TOMS will produce designs that are wanted by customers. 5.3.10 Factory Strikes In the event that strikes and other disasters occur at the manufacturing firms and factories that TOMS partners with, TOMS will do everything in its power to continue getting customers their shoes as well as giving shoes to our 50 communities. If need be TOMS will change manufacturing partners to more stable firms that are able to handle the high amount of shoes that are ordered from TOMS so that our customers and communities are still able to receive their shoes with as few problems as possible.

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