The Buy-One-Give-One (BOGO) model has gained traction in recent years as consumers increasingly demand sustainable and socially responsible business practices. This approach ensures that with every product purchased, a similar item or benefit is donated to communities in need. Despite initial skepticism about its impact on poverty reduction, the BOGO model is making strides in sustainable poverty alleviation, demonstrating its ability to marry profitability with meaningful social impact.

The Rise of the BOGO Model

The BOGO model is often traced to TOMS, a California-based company founded in 2006. TOMS gained widespread recognition for its application of the innovative business scheme, pledging to donate a pair of shoes to a person in need for every pair sold. Following promising success, TOMS expanded the program to include a range of other products including sunglasses (through a partnership with Seva Foundation).

Blake Mycoskie, the founder of TOMS, initially sought to aid children restricted by lack of footwear in getting to school. While partnering with IMA World Health, TOMS initiated its BOGO scheme in Haiti in 2011, distributing hundreds of thousands of pairs of new shoes to children in need in an attempt to break the cycle of poverty.

Evolution and Impact of TOMS’ Giving Model

TOMS was compelled to reassess its approach after facing financial challenges nearing bankruptcy. In 2019, the company decided to move away from the BOGO model to a broader social-giving approach, donating 1/3 of its profits to community-led philanthropy. Overall, despite criticism and financial pressure, the company has made an outstanding dent in the realm of poverty alleviation through the remarkable scale of provision of footwear, sight restorations and access to safe water using the one-one model.

To date, TOMS has provided:

• Nearly 100 million pairs of shoes
• 780,000 sight restorations
• 722,000 weeks of safe water
  

Analyzing the Critiques of the BOGO Model

While the BOGO model initially garnered praise for its direct impact on impoverished communities, criticisms arose regarding its long-term effectiveness and unintended consequences on local markets.

According to a study of the model, consumer interest is boosted by 60% when tied to charitable donations, but this enthusiasm drops to 52% when consumers consider potential negative outcomes such as aid dependency. During an independent impact study specific to TOMS shoes, several key insights were revealed. The study, which focused on TOMS Shoes’ charitable efforts in El Salvador, sought to address two main questions that have been subjects of criticism toward the BOGO model.

TOMS’ Response to Criticism and Adaptation

The study first examined the effect of distributing free shoes on local markets, discovering that for every 20 pairs of donated shoes, local vendors sold one less pair. It then evaluated the impact of receiving donated shoes on the children. While 95% of the children viewed the shoes positively and wore them regularly, evidence of transformative effects on children’s lives was minimal.

In fact, some concerning findings emerged, such as a slight increase in dependency among the children who received the shoes. Despite criticisms, the study praised TOMS’ responsiveness and commitment to enhancing its program. Through flexibility and transparency, such as offering sports shoes and exploring alternative distribution methods, TOMS demonstrates a commendable approach to poverty alleviation, showcasing the strength of adaptation for continuous improvement in the field.

BOGO Model Evolution: Spotlight on B1G1

TOMS’ move away from the BOGO model does not mark the end of one-for-one schemes but instead signals a shift toward newer strategies that focus on long-term effects and include nonproduct-based contributions.

The model has evolved to counter dependency and negative impacts on local businesses, now emphasizing donations that precisely meet the needs of recipient communities. Leading this transformation is ‘B1G1’, a social movement from Singapore, launched in 2007, that has engaged in 330 million projects worldwide to combat poverty.

So far, through its collaborating businesses, the B1G1 community has provided:

• 375,020 days of access to income-generating tools
• 21,214 micro-loans to support impoverished communities
• 8.2 million days of access to education for disadvantaged children
• 4 million education tools such as textbooks and stationery.

Combating Poverty: The Initiative’s Impact

These initiatives foster self-sufficiency by promoting job creation and entrepreneurship, vital elements for stimulating economic growth, enhancing productivity and increasing innovation.

• The B1G1 initiative provides an accessible and seamless opportunity for businesses to integrate their activities (from a product sale, customer interaction, or a special milestone) into specific poverty-reducing projects. These include providing access to education, food, shelter, health care and income-generating opportunities.
• B1G1 empowers long-term planning by ensuring a consistent stream of contributions, unlike ad-hoc efforts or passive approaches, providing charities and communities with reliable resources.
• B1G1 encourages growth for businesses navigating an increasingly socially conscious market, encouraging teams to showcase efforts through live website counters, customizable widgets and more than 5,000 apps for integrating business activities with distinct recurring impacts.
• B1G1 allows nonproduct field businesses to contribute to breaking the cycle of poverty. This diversification ensures that a wider range of societal needs are addressed, beyond those typically associated with fashion-related issues.

Looking Ahead

At the moment, initiatives like TOMS and B1G1 highlight the Buy-One-Give-One (BOGO) model’s significant role in poverty alleviation, underscoring the value of transparency and adaptability in ending poverty cycles.

As its approach to reducing poverty matures, the BOGO model’s evolution teaches that impactful change demands collaboration across all societal sectors. By offering sustained support to impoverished areas within a framework of social enterprise, these initiatives successfully contribute to breaking the poverty cycle.

– Freddie Ledger
Photo: Flickr