• 1. Tea Mogul Like most writers, I am wholly unqualified to hand out life or business advice — but I’m going to do it anyway. Unlike most writers, I don’t just piggyback on the experiences of others — my insight has been shaped by my own first-hand experiences in business. ...
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  • 2. Insight Running a business offers an insight that can’t be gained from reading books or watching documentaries or going to business school — sometimes you have to get your hands dirty if you want to truly understand something. ...
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  • 3. Disillusionment I first took an interest in business when I was 12 years old. I found a copy of Richard Branson’s book Losing My Virginity on my parents’ bookshelf and read it from cover to cover. I was so inspired that I hunted down Branson’s address and wrote him a letter asking for advice about starting up a student magazine. ...
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  • 4. Business school “Finally,” I thought, “something I can actually execute! First thing’s first. I need a name.” In situations where there are few barriers to entry, naming and intellectual property assume an even greater importance. I needed something catchy that was easy to spell, easy to remember, and would rank well on Google. ...
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  • 5. Assumptions Finding a reliable tea supplier was a challenging process. I didn’t think I would have much luck in New Zealand, so I started searching for suppliers in Australia. I typed in “tea supplier Australia” into Google and had my first search results. It looked like every website had been designed in the early 2000s — no price lists, no product pictures, nothing to indicate the size or quality of the business. ...
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  • 6. First-hand experiences After a crash course in the basics of tea, I decided to focus my search on diuretic herbs. The goal was a reduction in bloating and improved digestive function, so my tea blend didn’t need to contain herbal laxatives to be effective. After working my way through a shortlist of herbs, my original blend essentially wrote itself. ...
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  • 7. Launch I went to make myself a coffee and came back to my laptop. I opened Google Analytics. “Not long now and I should have my first visitor,” I thought to myself. As the thought was forming in my head, it happened. My first visitor. I almost leapt off my chair in excitement. I had been online for less than five minutes and someone was already on my website. ...
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  • 8. Oban Late one night, after several glasses of Oban whisky, I stumbled across an Air Asia deal on Twitter — return flights to Hong Kong from Melbourne for A$299. It seemed like the perfect opportunity to head over to China in search of a teabag manufacturer. I didn’t like the fact that there was nothing to differentiate my products from anything my competitors were offering. We were all selling the same loose-leaf tea, marketed in the same way, to the same customers. I wanted something different. ...
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  • 9. China My plan was to spend two days at the Canton Fair and one additional day looking at other fairs, before making my way back to Hong Kong. I wanted to use the first day to get a better understanding of the scale of the fair and how to deal with exhibitors and the second day talking to suppliers. At around 2pm on the first day, I stumbled across a small area tucked away in a far corner of the last hall that contained a few rows of tea merchants. ...
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  • 10. Thinking differently Founders need to understand that businesses should be seen as investments first and start-up enterprises second. At the end of the day, a business can only survive if it makes money. What makes a good investment will change depending on the nature of a business. With consumer product businesses, there is a heavy initial outlay to purchase stock. This stock is then stored and sold over time for a profit. ...
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  • 11. Patience After a week in Hong Kong, I made my way back to New Zealand. As I waited patiently for the tea shipment to arrive, I tried to keep myself as busy as possible. I got into a routine of posting regularly on social media, packing orders, and taking care of customer service. It felt like the entrepreneurial phase of the business had come to an end and I now had to focus on the mundane task of running a small business. ...
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  • 12. Parrots Employees with a stable income stay in a perpetual infant-like consumer state. They don’t know what they want and never think for themselves. When they see a new bike advertised at 40% off for one day only, they don’t stop and ask themselves whether they need a new bike. Instead, they fixate on the amount they stand to save by making the purchase. For just $720, they are able to purchase a bike that is usually priced at $1200, a saving of $480. ...
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  • 13. Shovels to miners There are so many unknowns when it comes to creating and marketing ingestible products. Any time someone is asked to ingest something, there is a high level of trust involved. There are laws in place that provide guidance on how ingestible products should be labelled, how they should be stored, and how they should be shipped. ...
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  • 14. Over and over Since it is so difficult for most online stores to generate organic website traffic, I was immediately drawn to products that could be consumed over and over. If customers could buy something on an ongoing basis, it stood to reason that they would be more likely to come back without being prompted by advertising or direct marketing. Tea is fortunately one of those products. ...
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  • 15. Influence In the space of two years, influencer marketing went from a hobby, where popular people on social media would post about products in return for free samples, to a profession where fully-fledged influencers would demand thousands of dollars to post about product or brand. In 2013, an influencer with 50,000 followers on Instagram was charging, on average, less than $50 per post. Over time, the fees started to increase. ...
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  • 16. Stories After 18 months in business, I started to identify core weaknesses in my business model that couldn’t be changed. I didn’t have an annuity-payment type business. I had a business that threw off cash, but I always felt incredibly uncomfortable investing in stock. ...
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  • 17. Ethics Despite the fact that I was selling a weight-loss product, I was clearly on a different ethical wavelength to a lot of other business owners in the industry. In the first few years of the teatox boom, most of my competitors utilised an effective form of social proof to generate sales - before-and-after photos. It’s much easier to sell a weight loss fantasy to potential customers when you can prove that your product works by showing just how well it has worked for other people. ...
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  • 18. Meet Sophie By the time my second shipment of tea arrived, I had arranged to have my stock stored at a third-party warehouse. The warehouse I contacted wasn’t in the business of order fulfilment, but they agreed to test it out. They allocated a member of their warehouse staff to pack orders when they had downtime from their other work. Third-party fulfilment is great for many reasons. ...
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  • 19. Bundle A few weeks after receiving my second shipment of tea, I designed new packaging and placed my third order. I wanted to make sure the new shipment arrived before I sold out of my existing stock. This time, Sophie was front-and-centre. She was the focal point on the front of the pouch and on each teabag wrapper. I wanted to remind customers about Sophie every time they had a touch-point with the brand. My brand strategy, for the first time, felt cohesive. ...
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  • 20. Formulas The best businesses create something once and are able to sell that product or service an infinite number of times. This is why software and gaming companies make such great businesses — create something once, distribute it online, and sell it a million times to people all over the world. This idea of creating something once and selling it many times is what attracted me to fast-moving consumer products. Products like Red Bull or Big Mac or Coca-Cola, were all created a long time ago as single, standalone products. ...
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  • 21. Twelve hundred dollars With two products, my bundling strategy had started to take shape. As expected, my average sales price improved and the store’s conversions rose sharply. However, two products were never going to be enough. I knew I was going to need other products for the bundling strategy to take full effect. ...
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  • 22. Discomfort The ecommerce landscape changed dramatically during the four years I was in business. When I started OMGTEA, it was a different world. Facebook was a place to go to connect with friends and family, ecommerce was still in its infancy, and influencers were only too happy to accept products in exchange for posting. It was a more wholesome time. The future seemed so bright; and for a time, it was. The overwhelming shift towards online consumerism gave birth to a new type of business, the likes of which the world had never seen - the Instabrand. ...
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