Anne Hansen, Bag Indeed

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“My background is in marketing. I worked with Procter & Gamble for 5 years and managed the launch of skincare product SK-II in Thailand. Then I got some minor health issues and starting to ponder if that was the right career choice for me. I knew I would always have to work very long hours and finally decided that I didn’t want that for myself. I went on to take a Doctorate of Business Administration with the University of South Australia, thinking that I would eventually work as a lecturer or an independent consultant. Then I got involved into opening the first franchise of restaurant MK Suki in Vietnam, together with a friend. The business was going well but after a year I sold my shares and came back to Thailand. A friend of mine, who has a wholesale business that sells women’s handbags, asked me if I could help her out expand into exporting. Due to some internal issues, this got delayed so in the meanwhile I started selling her bags on Facebook. That’s how I created Bag Indeed in February 2011.”
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“When I started early 2011, Facebook was already big in Thailand but not that many people used it to sell their products. And those that did, weren’t very professional about it. They didn’t use good pictures, had poor customer service, and would threaten customers to blacklist them if they didn’t pay within a certain time frame. The packaging was not good either because the assumption at that time was that if you buy online to get cheaper prices, you can’t expect much. But that has never been my style. Regardless of how cheap a bag is, I still package it nicely because I wanted my customer to have a really good shopping experience, to open the box and feel wowed. So that’s how I stood out. Good prices, great pictures, beautiful packaging, and strong customer service.”
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“I source from several different factories and each factory has its own designers. We are targeting the mass market. Most of our customers are in the 25-35 age range and at least half of them are upcountry. For us variety is key so we bring 3 new styles every week. I normally get each new design in 3 colors and I order 50 pieces per color. We have identified a color pattern – black, brown, and other basic colors typically do well – but it’s really hard to tell which styles are going to sell well. Often the styles I like don’t sell and the styles I don’t like, sell very well. We have weekly meetings with the staff and we try to guess which ones are going to sell well and most of us get it wrong. I always make sure we have enough stock so that customers can get their bags in 2-3 days but knowing how much we should stock for each product has been the most difficult thing for us. You can never tell in this business.”
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“Marketing is quite easy if you can spend. The number of followers depends on your ad budget and sales will go up as a proportion of it. It’s important for people that run online businesses to be very skilled at advertising and know how to use ads smartly. This is the heart of the business. The first few months of Bag Indeed I reached sales of 30 bags a day only through friends and their networks. At that time Facebook didn’t limit the number of followers that could see my posts. But then I learned that by paying for ads I could expand my customer base so I started doing that and my business increased considerably. Now I know that if I don’t pay for a post, I won’t sell much of that product. Every day I get a report on how much we spent on Facebook ads, how much we sold of those products, and what the payout is. This is how I control my business. My advice is to truly learn how to operate online ads and once you do, determine what level of sales you want to target and how much money you want to put in.”
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“Initially I created my own website but people didn’t want to order from it. They didn’t want to bother with filling out all the information and preferred to browse online and then get in touch with us via LINE to make a purchase. So I kept only Facebook all this time but last month I revived my website. Things have changed and people have gotten more used to purchasing online so I think now purchasing through the website will work well.”
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“After 2-3 years of selling online I tried to expand to retail. I was contacted by two different department stores and invited to join them. Initially I refused to only focus on the online business but eventually I decided to give it a try. I ended up with 7 outlets, which I closed after a year and a half because it didn’t work out at all. The problem was that I didn’t have the right price structure for them. My bags were priced too low to afford the cost of being at a department store. I thought maybe I could manage if I sold larger quantities but our brand was not that well known to do so. Also, some people were surprised to see bags that inexpensive compared to other brands sold in the department store. I sold different styles online and retail but I had to keep a fairly similar price structure. It took me several months to decide to shut down retail operations but it was the right thing to do. While I was trying to expand in retail, I was spending all of my time in department stores and neglected the online operations. After I closed down, my online sales started picking up again.”
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“My retail business failed but I don’t regret it because I learned from it. If I hadn’t done it then, I would have done it later anyways because it’s something that I wanted to try. It’s very difficult to run online and retail operations at the same time so my advice to others is to choose either one or the other. You need to know your priority. If you want to sell online, it’s important that your price is competitive because people shop online for convenience and to find good deals. In retail the pricing structure is different and you can’t sell too cheaply because of the high costs involved. So unless you are a big company, don’t do it in parallel. Know your priority and choose where your focus will be.”
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“I used to plan and strategize about everything when I worked at P&G but now that I run my own company I learned not to do that. We operate in an environment where things fluctuate constantly and can change anytime. For example, I don’t know how Facebook will be next year so I cannot predict this aspect but I try to mitigate that risk and be more independent. That’s why I decided to revive my own website and build the brand from there rather than just relying on Facebook. I have a dream for Bag Indeed but I don’t see that as a target. My target is to do my best and see my business grow.”

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