How to Escape the Commoditization Trap

Brief Summary of Episode #33

Profit can be deeply rooted in purpose.

Years ago, TOMS built the BOGO model — buy one, give one — with their shoe company. Over time, however, they lost their way and started to look like every other company selling shoes.

It was sad.

Today, Bombas has grown into the "TOMS of socks." Using the same BOGO model, Bombas donates a pair of socks to the homeless for every pair they sell.

Like TOMS, this is not just about charity for Bombas. 

This is about business. 

It's about growth. 

And it's about profitability.

But that growth and profitability comes from helping other people outside of a company's traditional key stakeholders. 

How profitable is Bombas? Well, it drives over $100 million in annual revenue. 

$100 million.

From socks.

That's a powerhouse of a brand.

Bombas is not an outlier. Data shows that purpose-driven brands continuously outperform traditional ones.

Unfortunately, many banks are still guided by traditional mission and vision statements that aren't formed by past perspectives.

I suggest something different — a purpose statement. What can your financial brand do to bank on purpose? 

I talked more about purpose-driven brands on the last episode of the Banking on Digital Growth show.

Key Insights and Takeaways

• How TOMS built a business around a purpose and then forgot it
• Why banking on purpose is an accelerant for future digital growth
• And how Bombas has replaced TOMS as the purpose-driven brand for banks and credit unions to emulate