Patagonia Made $10 Million On Black Friday And Donated Every Cent To Save The Environment

Patagonia, a brand based upon its premium outdoor clothing and gear had projected that it would hit $2 million in sales on Black Friday, but instead made $10 million. The company has announced that they will donate 100% of this income to charity. Patagonia brands itself as an environmentally and socially responsible company, and in relation to this, it plans to donate to “hundreds of grassroots environmental organizations.” In the point of view of the typical business mindset of maximizing profit, this may seem to make entirely no sense. This raises the question of how Patagonia, a brand in a heavily competitive industry can stand its grounds with its competitors.  However, after close inspection of the core strength of Patagonia, that is, their strong branding, they are still relevant competitors seeking to maximize profit.

First off, a quick look at their website would lead you to two observations. First, their prices are insanely high in comparison to a cheaper brand of outdoor clothing. A standard shelled jacket that would cost ~$80 to $199 for reputable brands like Columbia Sportswear and Bench, goes for $529 by Patagonia. Secondly, you would notice that they are heavily rooted in their values to be environmentally and socially responsible. In fact, their mission statement is: Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis. This is where their strengths lie – to establish themselves as a socially and environmentally responsible brand to appeal to an array of customers that are willing to pay more for the brand. Because of their branding and amazing showing of business ethics, their products although priced considerably higher than its competitors are still in a competitive demand for profit. If not for this core strength, Patagonia would be guaranteed to make minimal sales if they were to stay at the prices they are now. Therefore, by donating 100% of their profits to charity they are reinforcing their strength in brand and purpose, making them more desirable in the eyes of consumers which allows Patagonia to raise their prices. One quick look at the opinion of the people of reddit can affirm this. User monsieurpommefrites states ‘An company with actual integrity. In the year of our lord 2016. Consider me a future customer.’

Of course, it is foolish to say that Patagonia only instills their values of being a socially and environmentally friendly business to maximize profit. Instead, it should be viewed as a wonderful business plan and strategy that maximizes both business ethics and profit at the same time.