Tom's of Maine: Where CSR is a Way of Life

Tom's of Maine: Where CSR is a Way of Life

In 1970, the husband-and-wife team of Tom and Kate Chappell co-founded their Kennebunk, Me., natural personal care products firm with a mission: to create products that were more healthful to use, and to produce those products in synergy with their community and environment. Now one of the most successful small corporations in America, Tom's of Maine is proof that it is possible to integrate personal values with managing for all traditional goals of business -- making money, expanding market share, increasing profits and building customer loyalty.

The makers of the fast-growing Tom's of Maine line of toothpaste, deodorant, soap and mouthwash founded their company on the notion that humans, animals, and all other forms of nature deserve dignity and respect. Their commitment to social responsibility is not taken lightly.

According to Nancy Rosenzweig, the firm's director of corporate communications, "You have to be intentional about walking your talk. It influences every aspect of the way we do business, from how we listen to and respond to our consumers, how we treat our employees (flexible work schedules and job sharing are commonplace), to how we interact with the community, how we deal with our trading partners, how we deal with the environment, and, ultimately, how we share our profits."

It is also never ending. Adds Rosenzweig: "You may never achieve perfection but you must always be working toward narrowing the gap between your mission and your actions."

Thorough Approach To Product Development

Accordingly, the firm makes its products with the highest quality natural ingredients without additives, preservatives, artificial flavors, or fragrances. Packaging is also responsible. Tom's of Maine toothpaste, for example, comes in a recyclable aluminum tube inserted in a box made from 100% recycled cardboard and printed with soy-based inks.

Unique in the marketing world, Tom's of Maine lists all ingredients on product labels together with the specific purpose and source of each ingredient. Notes Regis Park, assistant manager of communications, on why the company provides so much detailed information, "We share more up front information with consumers than anyone else. We assume they are intelligent and discriminating, and that they want to make informed choices."

To reinforce its commitment to consumers, Tom and Kate Chappell's signatures appear on every product label and the company answers each consumer letter personally. Says Rosenzweig, "When you have a dialogue between two real people there is a heightened sense of understanding and responsibility. Just as in a personal friendship, when we don't do something right, we say we're sorry and work to correct it."

Family and Community Orientation

The parents of five children themselves, Tom and Kate Chappell demonstrate a strong commitment to family-oriented policies. Tom's of Maine offers its employees a one-month maternity or paternity leave, partial child care reimbursement for employees earning less than $32,000 annually, flexible work schedules, and a child care referral service.

Acknowledging the business benefits of such policies, Tom Chappell notes, "Show your employees respect and concern, demonstrate that you care about the quality of their lives, and you'll get loyalty and hard work in return."

These family-friendly policies has earned Tom's of Maine a coveted spot on Working Mother magazine's annual list of 100 Best Companies for Working Parents.

The company takes its responsibility to the community seriously as well, donating ten percent of pre-tax profits to charitable causes. This represents one of the highest percentage donations of any corporation in America. Much of that money supports environmental concerns such as recycling and conservation.

In 1991, with financial support and the loan-out of an employee who affectionately became known as "The Trash Lady," the company helped the town of Kennebunk start its first recycling program. It is now engaged in a 15-year long relationship with Community Partners Inc., a facility for the mentally and physically challenged, providing job opportunities for several of the group's clients. In addition, the employees can donate 5% of their paid work time to community service activities. Regis Park ends each day by calling an elderly shut-in man in Wells, Maine, as part of a Tender Loving Callers program in her community.

Competitive Advantage

At Tom's of Maine, a little respect for the consumer and a policy of openness is paying off. Their offerings command a 20%-50% premium, depending on the product and market, and in 1995, the company' sales were $20 million, up more than 25% since 1991.

Moreover, what started as a profitable niche opportunity is now finding its way into the mainstream. The full line of Tom's of Maine brand natural personal care products is now distributed in 7,000 health foods stores throughout the US, Canada, and England, as well as 20,000 food and drug outlets on the east and west coasts.

Admittedly, Tom's of Maine's environmental and social strategies are not based sheerly on altruism. Rosenzweig concedes, "The environmental and social responsibility policies are a barrier to competitive advances. Even a competitor with much greater resources cannot just replicate our formula and expect to take our market share. Our corporate practices add a richness and depth to our product appeal that creates an unusually strong brand loyalty."

Indeed, Patti Murphy, Tom's of Maine's consumer relations coordinator, reports that the company receives more than a 75 letters a week from consumers. She notes the one theme that dominates the consumer mail is an appreciation for Tom's of Maine's values.

Tom's of Maine's pioneering policies, which are detailed at greater length in Tom Chappell's book, Soul of a Business, have not gone unnoticed by other corporate environmental stakeholders. In 1992, the company received the prestigious Corporate Conscience Award for charitable contributions from the Council on Economic Priorities. In 1993 the Chappells were presented with the New England Environmental Leadership Award, and the Governor's Award for Business Excellence.


© Copyright 2001 J. Ottman Consulting, Inc. Jacquelyn Ottman is president of J. Ottman Consulting, Inc., a NYC-based marketing consulting firm that advises companies on how to develop and market environmentally sound products. She is the author of Green Marketing: Opportunity for Innovation, from which this profile is excerpted.