Panda Sunglasses
Case 1 Panda Sunglasses How Should a Start-Up Business with a Social Mission Market Its Sunglasses with Bamboo Frames? V incent Ko showed his entrepreneurial potential in high school in Rockville, Maryland, when, as a young hockey player, he invented a drying rack for hockey pads that he sold to his teammates, then on eBay, and finally on a Web site for the company he created. A few years later, while attending George Washington University in Washington, D.C., Ko and two friends, Luke Lagera and Mike Mills, were inspired by the growing social entrepreneurship movement and the success of companies such as TOMS shoes, a company founded by Blake Mycoskie that donates a pair of shoes to someone in need for every pair it sells. One day while walking through the Georgetown shopping district, the friends noticed a display of sunglasses and decided to create a business that would market cool sunglasses and provide eye examinations to someone in need for every pair sold. In keeping with the idea of a socially responsible company, Ko suggested that they make their sunglasses frames from eco-friendly bamboo, a lightweight, sturdy wood that grows extremely fast. Having grown up in China, Ko was familiar with the properties of the renewable wood and knew that it was the perfect material from which to make sunglasses frames. They created a company, Panda Sunglasses, and set out to find companies that could make the product they envisioned. Ko knew bamboo was the most commonly used wood in China, so the team began looking for a company in China to manufacture the frames to their specifications. Not only did they find a Chinese wood shop that would make their sunglasses frames, but they also located a Chinese eye wear manufacturer to produce the polarized lenses. Pairing the two companies gave them their unique, stylish sunglasses, which float. They created a Web site and began selling them at $120 a pair. Through a connection that Lagera had, the young entrepreneurs found an ideal partner in the Tribal Outreach Medical Association (TOMA), a nonprofit organization that provides eye examinations and other health services for tribal communities. They quickly reached a deal: For every pair of Panda Sunglasses sold, the company would pay for one eye exam through TOMA. The entrepreneurs’ next challenge was to market their unique sunglasses and their potential to help people in need. They knew that without sales, their effort at “conscious capitalism” would be for naught. None of the three cofounders had any experience in the retail industry, but they learned quickly on the job. The young men had just graduated and took “regular” jobs to pay their bills, but they remained 690 dedicated to making Panda Sunglasses a success. After testing sales of their sunglasses online, the trio began applying for spots in various trade shows geared toward accessories. One of the shows they applied to was the prestigious ENK International trade show, which attracts more than 250,000 buyers and press members from across the globe. Companies that are accepted to the juried show find sales leads that generate total sales of more than $1 billion. Mills sent Ko an e-mail in which he joked that they would be willing to set up in a broom closet at ENK if their application were accepted. Ko forwarded that e-mail to executives at ENK, who responded with, “We’ll find you a booth instead.” At the ENK show, Ko says he and his cofounders, fresh out of college, created a booth that featured a giant bamboo backdrop that attracted a great deal of attention. At one point, they struck up a conversation with three women, who they learned were buyers from the retail chain Nordstrom. The trade show opened many doors for the young company, and less than two years after starting, Panda Sunglasses was generating annual sales of $350,000. Questions 1. How can social entrepreneurs such as the founders of Panda Sunglasses use their companies’ social missions to attract customers and promote their businesses? 2. How should the founders of Panda Sunglasses define a unique selling proposition for their company that resonates with customers? 3. Write a brief memo to the founders of Panda Sunglasses outlining a bootstrap marketing plan for the company. 4. Use the business model canvas to illustrate Panda Sunglasses’s business model. Can you identify other revenue streams that could support the company? How can the company strengthen its relationships with customers? 5. How should the founders of Panda Sunglasses use social media to market their company and its products? What can they do to increase the traffic to and generate more sales from their company’s Web site? Sources: Based on Nancy Dahlberg, “Start-up Spotlight: Panda,” Miami Herald, June 29, 2014, http://www.miamiherald.com/2014/06/29/v-print/ 4207736/startup-spotlight-panda.html; Olga Khazan, “Panda Glasses Are TOMS Shoes for Your Face,” Washington Post, May 24, 2012, http:// www.washingtonpost.com/blogs/on-small-business/post/panda-glassesare-toms-shoes-for-your-face/2012/05/23/gJQAsOPhlU_blog.html; Alicia Ciccone, “Vincent Ko, Panda Sunglasses: Sustainable Bamboo Eyewear That Gives Back,” Huffington Post, May 25, 2012, http://www .huffingtonpost.com/2012/05/25/vincent-ko-panda-sunglasses_n_1544043 .html; “Panda Sunglasses Are More Than Meets the Eye,” Asian Fortune, April 25, 2014, http://www.asianfortunenews.com/2014/04/pandasunglasses-are-more-than-meets-the-eye/; Zach Gordon, “Alums’ Business Aims to Help the Needy,” The Hoya, May 17, 2012, http://www .thehoya.com/alums-business-aims-to-help-the-needy/.
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