Ask any woman who has ever owned or encountered a Miche bag and she will tell you that it’s a bag with buzz. Women who carry Miche bags become walking advertisements for the product and its unique design. What makes it so unique? The fact that it offers the opportunity to change its outer design without having to change the bag’s contents. In literally seconds women can change their bag to match an outfit, choosing from hundreds of design possibilities.
The concept was the brainchild of Michelle Romero, who spilled something on her bag and was frustrated with the thought of searching for a replacement and transferring the contents—something that virtually all women can relate to. Necessity, as they say, is the mother of invention. Spurred by an immediate need, Romero had an idea: Why not create a bag with changeable covers?
She created a prototype out of glue and some scrap fabric and showed it to a friend, Annette Cavaness, an accessories buyer. Together they launched Miche Bag LLC in 2005. Pronounced MEE-chee, the name stems from Romero’s nickname. She later brought the concept to serial entrepreneurs Corbin Church and his partner Chris Seegmiller, and Romero is no longer actively involved in the day-to-day management of the business.
“My childhood friend approached me in early 2007 and said ‘I have a product for you to look at,’ ” recalls now-CEO Corbin Church, who joined the company in 2007, and up until the spring of 2012, worked out of his basement with 19 employees. Initially, when he learned the product was handbags his response was lukewarm, but he says, “He proceeded to explain that it was a very unique handbag and unlike anything else out there.” And, indeed, Church says it was a unique concept. “It had the characteristics of what I look for in a product.” To test the concept further, Church turned to some women who represented different demographics and asked for their input. “They absolutely went nuts over this product,” he says. “They couldn’t believe what they were seeing. It was that shock or ‘aha’ factor that everybody gets when they see this product.”
Jennie Platt is the Chief Design and Production Officer at Miche Bag, the woman behind the trendy and continually evolving designs that keep customers coming back for more. “From a design standpoint what we do is really unique in that we have found a way to really help women find a unique product,” she says. For Miche representatives, she notes, “It gives them an opportunity to create a lifestyle inexpensively that is still very fashionable and fun. It has been really amazing to create a product that has given the opportunity to so many women to find ways to either support their families or to create additional income, whether for vacation or travel or to send their kids to college.”
Despite its youth, Miche has already evolved significantly from its initial launch.
“It gives [representatives] an opportunity to create a lifestyle inexpensively that is still very fashionable and fun.”
—Jennie Platt, Chief Design and Production Officer
Miche was not an overnight success—but it was close. Initially, Church sold the product through kiosks in malls, which provided the opportunity to demonstrate and explain the product.
“We opened the first kiosk in July 2007 and it exceeded our expectations by almost two and a half times,” says Church. “So right away, we got off to a good start, but we had the typical challenges of a new company.” Chief among these challenges was the economic downfall that hit its peak in 2008. “Malls became ghost towns, and it was a difficult time to try to be in a retail space to conduct business,” he says.
Faced with these challenges the company began to look at alternative sales channels. These included infomercials, home parties and web marketing.
Direct sales through home parties proved to be an important part of the mix for Miche, recalls Church. “Our home party business began to grow, and grow fairly dramatically,” he says. “So we started to embrace that, but we didn’t turn away from some of those other channels. We still had carts going, we still had the infomercial going, web was a big channel for us, retail was still a big channel for us—but home parties started to dominate our business, so our focus became home parties.”
By the fall of 2008, 80 percent of the firm’s revenue was being generated through direct sales. “We were seeing dramatic sales growth,” says Church. The company did about $200,000 in sales in 2007; in 2008, about $7 million; in 2009, $30 million; and, he says, this year they expect to approach $100 million.
The company did about $200,000 in sales in 2007; in 2008, about $7 million; in 2009, $30 million; and this year they expect to approach $100 million.
Secrets to Success
Why such significant success? “This is a big question,” says Church, who points to a few keys. First, the product. “Unlike other sales companies, our product is a walking billboard,” he says. “If you have a Miche handbag and somebody walks up to you—a total stranger—and says, ‘oh, that’s a cute bag,’ you don’t turn to her and just say ‘thank you.’ You say, ‘This is one of those really cool Miche bags.’
“You can carry any other bag and it’s just a great bag. It could be a Michael Kors or a Gucci and you make whatever statement you make. But there’s only one bag that makes a statement on its own, and that’s Miche.” The nature of the product itself is what has contributed to the company’s success, says Church. “It’s really been phenomenal for us. We are so unique. That puts us in this category pretty much all by ourselves. We’re pretty much all alone in the exchangeable handbag business.”
The other element of the company’s success, says Church, is an element of direct sales. “We change people’s lives,” he says. “Our business is very fun. The fun factor with us is very apparent—the fact that you’re in the fashion industry, in fashion accessories.” He says Miche is not a fad. “So many people have asked, ‘How have you kept this fresh and exciting?’ We constantly change our products and we are adding new styles every single month, which is a mammoth task.”
Over time, the demand for Miche has fueled continued growth, new designs and related accessories. Base bags are now available in six styles and range from the petite to the prima and demi. Base bags come in black or brown and some styles also offer interchangeable handles. An increasingly wide range of shells for the bags is continually updated and augmented with new styles and designs. Shells are attached to the bag with magnets. The product line also has been augmented with the non-interchangeable hip bags, wallets, coin purses, closet organizers, a purse organizer and bag charmers—key ring-like accessories that can be attached to the bags’ handles. The bags and accessories, says Church, are “an affordable luxury” for women.
Paying It Forward
In addition to pride over the impact that Miche has on the lives of its representatives, Church says that contributing in bigger ways is also important to the company.
Church lost his father to cancer in 2007, just two months before starting the business, he says. Cancer became a very personal issue for him. “I wanted to kill cancer,” he says. So, cancer has become the cause that Miche focuses on. And, in keeping with its product line, the focus has a direct tie-in with its products.
“In the past two years … more than $2 million has been donated to cancer research from a very young, very small company.”
—Corbin Church, CEO
Platt designed a shell that has become known as the “Hope shell.” The shell incorporates quotes from people who have been impacted by cancer. All of the profits from the sale of this shell, says Church, are donated to cancer research. “In the past two years that has amounted to more than $2 million being donated to cancer research from a very young, very small company. It has turned into an amazing program.”
The company provides opportunities for employees to make a personal impact on others’ lives as well. Miche does a humanitarian trip each year as a company and “everybody is invited,” says Church. Last year the company went to Peru for a week to provide basic education on hygiene at an orphanage. “We brought the children gifts and became part of their lives for a week,” he says. They also brought electricity to a wing of the orphanage. This year in June the company will spend a week in Ghana putting the finishing touches on a school dedicated to one village. “We’ve learned that these things are so important to show heart and meaning for a company.”
As Miche focuses its efforts on making a difference in the lives of its staff, its representatives and people around the world, it is also finding focus in its approach to creating a sustainable business model for the future.
Over time Miche had developed multiple channels of sales and distribution—retail sellers, national distributors, and independent representatives of two types—those who purchased through a distributor and those who carried their own inventory. The multiple channels created overlap and competition, though. That, and the obvious potential afforded through Miche parties, prompted the recent change, which is being phased in as retail outlets and distributors are phased out.
In August 2011, Miche Bag announced a new business model that launched it firmly into the direct sales industry. Miche Parties now provide thousands of representatives around the world to reach out and personally connect with women who have quickly become enthralled with a simple idea—purses that can be transformed in seconds through interchangeable shells in a wide array of colors and styles.
In August 2011, Miche Bag announced a new business model that launched it firmly into the direct sales industry.
“We became a full-fledged party company on Feb. 1 this year,” says Church. “There were a lot of questions about who and what we were as a company because we were in so many different channels. We decided that since party plans represented over 80 percent of our revenues that we needed to become a true party plan company and provide our representatives with the growth opportunities and the resources they need to succeed.”
To support this shift, he says, retail has been entirely cut out of the mix, and he admits this wasn’t a very popular move. “We had a number of distributors that were selling our products around the country. The representatives that formed our company were representatives under these 300 distributors. That was a very difficult decision to figure out how to give these representatives what they needed to grow and flourish, yet take care of those distributors. We built in programs so that everybody could be happy.” But, he adds: “Is everybody happy? No. But I think we found a good balance in getting the company to where it needed to be.”
And it was a move supported by the company’s sources of demand for its products. “The end result is a company that is more appealing to a broader group,” says Church. With the change, Miche is shifting focus to its representatives exclusively, he says. “We brought on a software system that gives our representatives all of the tools that they need to be successful, and an income opportunity they had never seen before.” Previously, he says, representatives could earn a commission on their sales, but now they have the opportunity to build and support a team to enhance their income opportunities. “That’s a huge development for our company in the last three months,” he says.
Early results suggest the shift has been a wise one. “It’s exciting to report that our company is 25 percent ahead of its projections,” says Church. “We’re growing more than we expected and it is very exciting.”
A Bright Future
Church says the company at 5 years old is still poised to present tremendous opportunities for its very newest representatives. “Most people still have not heard of a Miche bag,” he notes. “There is a lot of opportunity yet—not to mention that the customers we bring on stay very, very loyal to us.”
The future holds opportunity and innovation as Miche continues to focus on what matters most—its customers. “We spend so much time doing trend analysis and research, not only from a marketing perspective but also from a customer perspective,” says Chief Design and Production Officer Platt. “It’s very important to us to really understand who our customer is, what she wants and what her needs are.”
Jayma Woods, Executive Vice President, Domestic Distribution, agrees. “Providing this unique experience is unlike anything I have ever been involved with in retail before. As we’ve made this transition to a true direct sales model we have really seen how impactful it can be in somebody’s life. To be a part of that has been an honor for us.”