Luxury apparel e-retailer Olivela has a clear value proposition: it donates 20% of the proceeds of every purchase to benefit educating girls around the world through one of three charitable organizations. To get that message across, the retailer features a dashboard that prominently displays the impact—or “Olivela Effect”—of every purchase.

The retailer bases that Olivela Effect figure on a calculation made by the charity CARE that $4 can provide one day of education and support. Thus, the retailer can show a shopper that purchasing a $2,110 Victoria Beckham dress will pay for 62 days of school.

The retailer’s objective, in addition to selling luxury goods online, is to provide girls in
underdeveloped countries the opportunity to go to school. As of mid-July, the retailer claims to have provided more than 131,000 days of school to girls worldwide. The merchant’s approach, which melds luxury retail with a charitable component, has helped Olivela grow quickly. While the retailer declined to provide sales figures, traffic to Olivela during the crucial month of December was up more than 266% year over year, according to data gathered from web measurement firm SimilarWeb Ltd.

Olivela has plenty of company among merchants donating sales or products to charitable causes. Toms Shoes Inc. pioneered the concept of donating an item—in the case of Toms a pair of shoes—to someone in need. And that model was copied by a number of retailers, including eyewear retailers Warby Parker and Pair Eyewear and sock retailer Bombas. Meanwhile, others, such as outdoor apparel retailer Patagonia, donate a portion of their total sales to philanthropic environmental organizations. Following in the footsteps of these charitable entrepreneurs, a second wave of retailers is expanding on that model by trying different tactics to get their message and mission across to consumers. And some are taking their efforts one step further by becoming B Corps., which requires them to meet the nonprofit B Lab’s stringent standards that assess a company’s impact on its workers, community and the environment.

Want to read more?
Unlock Free Strategy Membership

Complete your free registration now to access this story and more in-depth reporting, data, and analysis

Already a member? Sign In