How Allbirds combined sustainability with cool to build a $4 billion shoe empire.

by The One Centre

29

November, 2021

29th November 2021

The footwear industry produces more than 20 billion shoes each year and is worth more than $365 billion. However, it is notorious for its poor environmental and ethical practices. The footwear industry has not been a shining light for sustainability or ethical products, from the widespread use of petroleum-based synthetics to mass production sweatshops.

Enter Allbirds, the sustainable shoe brand, on a mission to disrupt the commercial footwear industry and prove sustainability can be cool.

A wool sneaker may not sound like a cult item, yet Allbirds signature shoes have defied the odds to become one of the fastest-growing shoe companies in the world.

With a mission “to prove that comfort, good design, and sustainability don’t have to be mutually exclusive”. The San Francisco-based, New Zealand-born shoe company uses environmentally friendly materials, a direct-to-consumer business model, a simplistic design approach with minimal branding, and a reasonable pricing model (most shoes retail for $140).

Founded by Tim Brown, a former professional soccer player, and Joey Zwillinger, a biotech engineer, Allbirds vision was to create a stylish, comfortable shoe that didn’t cost the earth – both literally and figuratively.

Following its 2016 launch, it was quickly adopted as the shoe of choice in Silicon Valley, hitting cult status when Time called them “the world’s most comfortable shoes”. Allbirds is a hit with millennials through to boomers. It has a celebrity following, including Barack and Michelle Obama, Gwyneth Paltrow, Oprah Winfrey, and Leonardi DiCaprio– who was so impressed by the brand’s environmental credentials he invested in the company.

Play video

Brown and Zwillinger acknowledge that timing has played a considerable part in the brand’s meteoric growth. The combination of the athleisurewear movement, which has elevated the humble sneaker from functional to streetwear to high fashion, along with an increased consumer appetite for purpose-led brands, particularly those with strong ethical and sustainability platforms, has helped propel the brand’s trajectory.

Within five years, the merino wool sneaker brand had spawned a shoe – and clothing – empire valued at $4.1 billion. Yet, when compared with the likes of Nike and Adidas, which boast annual revenues of $38 billion and $22 billion respectively, Allbirds are small fry.

 

So how is Allbirds disrupting the footwear industry?

One word. sustainability. As a certified B Corp, which counts the planet as a “key stakeholder” in the business, Allbirds has embedded its purpose at the centre of its brand and built everything else around it. Often referred to as the sustainable shoe brand, Allbirds is the antithesis of the “big sneaker” brands, and consumers love it.

“Consumers are looking for brands that are purpose-native and authentically sustainable, as customers demand transparency with respect to the products they buy.”

“More than ever, consumers are voting with their wallets and supporting businesses who do not compromise on social and environmental issues. This trend is not going away—consumers are demanding more of companies, and the ones who thrive as we emerge from the pandemic are going to be the ones who take a hard look in the mirror at their sustainability practices and act swiftly and comprehensively,” says Zwillinger.

Allbirds has invested heavily in innovation, notably the ethically and sustainably sourced materials it uses for its shoes, which includes merino wool, eucalyptus fibre, fluorine-free waterproof coating and sugarcane. The sugarcane, used for the shoe’s soles, is a new technology pioneered by Allbirds called SweetFoam. It is the first carbon-negative polymer EVA material, and it removes carbon from the air and sucks it back into the shoe. Allbirds believe it is such a significant development it has offered to share the formula with any interested shoemakers – Adidas has already collaborated on a shoe with the brand.

Brown says, “If you look at the fashion industry broadly, it’s one of the largest emitters of carbon into the atmosphere. If you zoom in a little bit further and look at the footwear industry, you realise that about 20 billion pairs of shoes are made each year,”

“I think as part of our mission; it’s not enough just for us to use it — it’s also the idea that we will make this available to the larger footwear industry and the larger fashion industry and anyone who wants to use it. This is a problem we’re not going to solve just by ourselves; we’re going to solve it together.”

Allbirds called the move both altruistic and pragmatic: “The altruism is that if everyone uses this, it’s going to be great for the environment. The pragmatism is that if everyone uses it, the cost is going to go down,” says Zwillinger. It’s another example of Allbirds’ disruption within the footwear industry. By investing in innovation and technology to create new environmentally-friendly and ethically sourced materials, Allbirds are providing a leg-up for the whole industry as well as the planet – it’s a significant contrast to investing in technology to make people run faster.

“We have to keep innovating, but it’s not about fashion innovation. It’s about hardcore research and development with the materials and manufacturing.”

“When we began making shoes, and then clothing, our focus was on building exceptional products from naturally derived materials instead of petroleum-based synthetics. More importantly, we wanted to make a statement about making those things.”

While Allbirds has built the brand firmly around sustainability, they have also focused on comfort, style, and crafting a cool brand experience. As Brown says, “People don’t buy sustainable products. They buy great ones. We make great products that are sustainable.”  This is where the brand experience really comes to the fore. Allbirds tapped into the booming trend of direct-to-consumer models, operating online and via a small number of branded stores – Allbirds store footprint grew from 3 in 2018 to 27 stores in 2021.

This model provides the company with complete control of manufacturing and distribution. It cuts costs, improves efficiencies, and enables control of all brand touchpoints and the entire customer experience from browsing to unboxing.

Allbirds worked with Red Antler to develop the brand from scratch with a strategy “to create a brand that could build a movement”.  Red Antler achieved this by embedding curiosity into every touchpoint from the name to the logotype, the packaging, website, social media and store design.

As one of the brand’s most signficant touchpoints, the packaging is crucial. It is made from 90% post-consumer recycled cardboard and serves as a shoebox, shopping bag, mailer and in-store display all-in-one. This multi-functional system is a brilliant example of the brand, simple, practical, stylish and underpinned by sustainability.

The shoeboxes also serve as the core feature of the in-store brand experience, adding a colourful backdrop to the stores while also providing a simple way to view stock and showcase products. The colourful shelves of shoes are complemented by the stores clean design which uses raw stripped back materials to promote its environmentally friendly positioning. The stores also provide a tactile environment for customers to touch and sample the raw materials that go into the shoes.

Everything about Allbirds screams understated cool. Minimalist, practical, stylish and effortlessly cool.  The brand is the embodiment of the laid-back, no fuss, San Francisco cool. This is further reinforced through its brand partnerships and collaborations with artists and like-minded sustainable fashion brands.

In collaboration with the San Francisco Ballet for a dance film Colorforms, the dancers wore Allbirds as they moved around the city and its iconic destinations. Allbirds has also created a local partnerships series Allbirds And… which sees the brand link with like-minded businesses within a city such as Downtown LA, Sydney and Wellington. Another series, The Artists, connects the brand with artists and fashion brands to design limited edition shoes.

Perhaps its most significant partnership is its recent collaboration with Adidas, which saw the creation of fully recyclable performance running shoes with a 2.94kg carbon footprint– “a personal best for both brands”.

The two brands worked together “as one, to create a shoe as close to zero carbon emissions as we could possibly achieve,” says Brown.

The collaboration with a “competing brand” is a significant example of Allbirds commitment to its mission to save the planet. As Brown says, “We believe that the challenges of solving climate change is the problem of our generation and solving it will not be done alone. We need to find new business models, new innovations and new ways of working together.

While Adidas has been creating shoes from recycled and sustainable materials since 2015, the collaboration with a competitor signifies a significant and positive change for the industry. Brian Grevy, executive board member of Global Brands at Adidas, called the partnership “a call to action for other brands and a milestone in the industry achieving carbon neutrality.”

Play video

Allbirds has set impressive targets for 2025, “the most ambitious, science-based sustainability targets in the footwear and apparel industry”. The brand intends to cut its per product carbon footprint in half, which it claims will take the company “as close to truly zero emissions as we can get, before the use of offsets”.

It’s not a surprising target for the brand; however, the recent revelations that Allbirds has yet to make a profit – it lost $14.5 million in 2019 and $26 million in 2020 – highlights the commercial reality of its strong sustainability stance and the importance of brands working together to reduce costs and save the planet.

Why It Matters

  • Purpose and brand values are more important than ever. 52% of all US adults consider company values when making a purchase (Forrester Research 2018). Consumers are seeking out – and spending money on – brands whose values align with their own.
  • Allbirds demonstrates the importance of embedding values and purpose in your brand through your products, stores and across every touchpoint. Allbirds multi-functional packaging is the perfect embodiment of the brand experience; simple, stylish, sustainable, innovative, and effortlessly cool.
  • The environment is top of mind for consumers who believe brands are responsible for helping to solve the climate issues and behave more responsibly. Marketers need to demonstrate action and leadership as the days of inauthentic behaviour and greenwashing are over.
  • The direct-to-consumer model is growing in popularity for brands wanting more control.  Allbirds has complete control over manufacturing, distribution, sales and its entire brand experience from website, stores, packaging and product. It also expertly uses social media and its partnerships and collaborations with artists and like-minded sustainable fashion brands.
  • Collaboration between fashion brands is hardly new; however, competing brands partnering to create better, more sustainable products and technologies is a brave new world for marketing. Marketers need to prepare businesses for this future.

Credits

Article By: The One Centre
Ideas and innovation company
Twitter @onecentregroup

Categories

Share

Share on Facebook
Share on Twitter
Share on Linkedin
Share via Email

Related Stories

Fashion

Can period pants change the world?

Hospitality

How Flave’s big-flavour proposition is breaking vegan stereotypes.

Food & Beverage

How Ugly Food is disrupting the food industry and winning over consumers

Fashion

How Allbirds combined sustainability with cool to build a $4 billion shoe empire.

Transport

Get as much car as you need with a Lynk & Co subscription

Fashion

Why The Fabricant is dephysicalising fashion

Products

How Feather is fighting the fast-furniture epidemic

Health & Fitness

Are Rootine’s DNA-based vitamins really better for you?

Technology

Can AirSeed’s seed-planting drones put the brakes on climate change?

Technology

Replika is more than a friendly chatbot. It’s a footprint of you.

Finance

How a fear of debt is fuelling Afterpay’s spectacular global growth

Technology

Are Spatial's high-fiving avatars the future of work?

Transport

Behind Tesla’s supersonic rise as the world’s most valuable car company

Technology

Is Life360 bringing families closer, or pushing teens away?

Lifestyle

The Brands Saving the World from COVID-19

Finance

Happy Money: the fintech that’s curing debt addictions

Food & Beverage

Is Kin the booze-free future of revelry?

Lifestyle

5 brands (and sectors) to watch in 2020

Finance

Beyond is bringing transparency to the business of death

Food & Beverage

Lagunitas is brewing dope you can drink

Finance

Doconomy is a banking service with a conscience

Transport

Will Wing’s drone deliveries help or hinder bricks-and-mortar retail?

Health & Fitness

Oura ring is unlocking the secrets of sleep

Technology

Why millennials love paying for Lemonade insurance

Lifestyle

How Everlane’s radically transparent ethos is upending fashion

Health & Fitness

Recyclable glasses made simple from Dresden

Food & Beverage

Eat an Impossible Burger, save the world

News

Brands Disrupting the World: book now for our next ONEtalks

Health & Fitness

Sex education you can trust: how Clue is tackling taboos

Food & Beverage

Drinking Oatly is more than a trend. It’s a "paradigm shift"

Lifestyle

Mobile is at the heart of Nike’s House of Innovation stores

Centre News

The psychology of selling to the world’s ultra-rich

Fashion

The Phluid Project: Shaking up the gendered world of fashion

News

The One Centre acquires digital media agency Effilab Australia

Finance

Koho is taking back your dreams from the banks that stole them

Transport

Forget buying a Mercedes-Benz. Why not subscribe?

Technology

Behind the meteoric rise of the world's biggest vaping brand JUUL

Retail

Cult Korean eyewear label Gentle Monster takes on London

News

The One Centre presents the brands disrupting the world at ONEtalks

Transport

Uber has a better way to map data – and anyone can use it

Health & Fitness

Forget ‘stoner’ – MedMen is taking marijuana mainstream

Centre News

Four pillars of brand success – John Ford writes for Startup Daily

Fashion

Virtual celebrity Lil Miquela partners with Japanese label Ambush

Fashion

Oakley’s ode to obsession

Fashion

"Will finds a way" with Under Armour

Technology

Kengo Kuma is purifying the air at Milan Design Week

Technology

Facebook is building Willow Village. Would you live there?

Technology

Apple recruits Spike Jonze to welcome you home

Technology

Dot Watch is disrupting the Braille market

Transport

Is Hyundai Pavilion the darkest building on earth?

News

The One Centre presents ‘Disruption Needs Construction’ at Sydney Design Festival 2018

Transport

Nissan brings its tech to life with self-driving slippers

Fashion

Outdoor apparel brand Patagonia to sue the Trump administration

News

The One Centre is hiring creative directors. Here’s our manifesto.

Fashion

Tiffany & Co brings Breakfast at Tiffany’s to life with luxury collection

Products

Behind the scenes of OK Go’s ‘Obsession’

Fashion

The North Face combines daydreams and free skiing stunts in a mesmerising film

Fashion

Nike is fighting bots with augmented reality

Centre News

"The only way is up" - John Ford writes for Mumbrella

Fashion

Fashion house Yves Saint Laurent opens a museum in Marrakech

Transport

Volkswagen explores the father/son relationship in an emotional film

Technology

Meet Norman, a WebVR tool for doodling in space

Centre News

“Give Dove a break” - John Ford speaks to CMO magazine

Food & Beverage

Guinness saddles up Compton Cowboys for latest Made of More film

Products

Minimalist Japanese brand Muji expands empire with fresh food market

Technology

Teenage Engineering

Technology

A forest where gods live

Fashion

Louis Vuitton teams with Supreme for ultimate brand collaboration

Technology

Technological Nature

Technology

Playful Palette

Fashion

Nike creates graphic feast for Air Max

Transport

Volvo returns to safety positioning in masterpiece film for the new XC6O

Products

Ikea to employ Syrian refugees in social sustainability project

Technology

Screens of the future

Technology

Apple’s extravagant new campus brings brand values to life

Products

Transformative Appetite

Products

Dove launches Real Beauty Productions to tell stories of real women

Technology

Rapid Liquid Printing

Lifestyle

The brands coming out to support the LGBT community

Media & Entertainment

Abstract. The Art of Design

Retail

Target creates mini-musical spectacular for Christmas

Transport

Nissan creates mobile workspace

Lifestyle

Lincoln Motor Company taps Annie Leibovitz for campaign

Products

Braun creates hypnotic installation for London Design Week

Transport

BMW Films returns with an explosive short film

Fashion

Adidas Republic of Sports launches in China

Technology

Convert the world around you to Pantone with the new Pantone App

Experiences

Moleskine opens a cafe for creatives

Media & Entertainment

We're the Superhumans: Channel 4 returns with film series

Fashion

Activewear brand Lululemon expands into beer

Food & Beverage

Tiger Beer launches NYC pop-up store to showcase best of Asia

Products

P&G rolls out strong film in ongoing Thank You, Mom campaign

Products

Ikea launches brand collaborations

Fashion

Adidas creates sustainable shoes made from ocean plastics

Lifestyle

Google launches 360-degree interactive animated short film

Food & Beverage

Coca-Cola makes music with W Hotels

Finance

Save The Children returns with harrowing refugee film

Fashion

COS creates "show-stopping" installation

Fashion

Uniqlo aims for Utopia with flagship store relaunch

Food & Beverage

McDonald's transforms Happy Meal toy into VR experience

Technology

Samsung launches immersive brand experience store

Media & Entertainment

Lo and Behold: Netscout launches branded film at Sundance Film Festival

Fashion

Burberry teams with Apple to launch dedicated Music channel

Technology

Apple Watch creates blooming installation at Selfridges

Fashion

Nike targets women with luxury workout experience

Art & Design

HSBC soars in stunning elevator film

Hospitality

The Four Seasons Jet is the ultimate brand experience

Fashion

Savage Beauty: Iconic Alexander McQueen honoured in exhibition

Technology

Samsung film is a beautiful tribute to the power of technology

Fashion

Converse creates global exhibition to celebrate iconic shoe

Fashion

Leica and Moncler create Monumental exhibition

Technology

Wind Mobile celebrates human connections

Products

Lego targets architects with new product range

Products

GE revives iconic Moon Boot to celebrate role

Fashion

Nike's ‘Phenomenal’ World Cup experience

Fashion

Louis Vuitton Museum: a new level of branded art

Media & Entertainment

GQ to groom men with branded barbershop

Transport

BMW's iconic Art Cars Project launches global tour

Food & Beverage

Chipotle turns to literature in new project

Food & Beverage

Cornetto spreads the love with film series

Food & Beverage

Stella hits high note with Chalice Symphony

Finance

NRMA opens Crashed Car Showroom

Technology

Intel urges audiences to 'look inside' in film series

Fashion

Net-A-Porter launches glossy print magazine

Products

The Lego Movie hits cinemas worldwide

Food & Beverage

Guinness creates short film 'The Sapeurs'

Products

Dom Perignon and Jeff Koons create art

Fashion

Patagonia film celebrates the stories we wear

Fashion

Louis Vuitton's controversial exhibition

Food & Beverage

Chipotle wages war on Big Food

Technology

AT&T's brutal new film to stop texting and driving

Transport

BA tugs the heartstrings with Visit Mum film

Transport

Leave the world behind with Volvo

Technology

IBM & The World's Smallest Film

Fashion

Burberry merges digital and physical worlds

Lifestyle

Iconic landmark is on song with The Ship Song

Media & Entertainment

Bond's Skyfall is ultimate branded entertainment

Lifestyle

Red Bull goes Stratospheric

Transport

Audi showcases the future in Spheres

Technology

AT&T unveils transmedia experience Daybreak

Products

Google experiments with art and science

Technology

GE asks Australians for Two Words

Food & Beverage

Coca-Cola Moves to the Beat of London

theONEcentre

Strategy + Artistry

Level 3, 75 Pitt St
Sydney NSW 2000
Australia
hello@theonecentre.com


To receive updates on our
ONEtalks series and newsletter.

Back to top

theONEcentre

Strategy + Artistry

Level 3, 75 Pitt St
Sydney NSW 2000
Australia
hello@theonecentre.com