The internet continues to embody an ideal platform for the fashion industry. Starting a business that provides an online fashion shopping experience is still common. The amount of capital required is relatively small compared to cost for launching a web-based operation a few years ago.
New e-commerce shopping and fashion site Little Black Bag recently raised $2,750,000 of early stage capital from individual angel investors and groups. The company just started in 2011 and is headquartered in Los Angeles. A buying and merchandising office is located in New York City with an experienced retail buyer from Macy’s heading the team.
Little Black Bag follows a concept created in Japan that entails purchase of a mystery bag of fashion products and subsequent trading of items with friends. This is intended to generate excitement about shopping and socializes the process of obtaining desired products.
The social networking element of exchanges among connected friends begins with a process that distinguishes Little Black Bag from competitors. Users initially take an interactive quiz and are then provided with the mystery bag of personalized fashion and beauty products. A trading period of one week follows. Afterwards, the items remaining in a bag are shipped to the user.
A monthly membership fee to Little Black Bag is $49.95 and a single purchase option is available for $59.95. By partnering with 30 different brands, the company provides products such as Z Spoke by Zac Posen, BCBGeneration, Betsey Johnson, and Kenneth Jay Lane.
Company co-founder Dan Murillo conveys that Little Black Bag is ahead of its projections for both user registration and purchases. As with any online business, the key to long-term success is repurchases by existing customers. A high rate of repurchasing is indicative of consumer satisfaction. It maintains company revenue with a reduced cost by alleviating the push to capture new users. Little Black Bag expects to meet that challenge.