Welcome to Curious Business

Every Friday, I post a small insight into running Curio City and/or Blue Hills Editorial Services. My most recent posts are directly below. You can also start with the first post, or use the subject labels to the right to home in on particular topics. Feel free to comment on anything that interests you.
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Thursday, August 17, 2006

The State of the City

Fast forward nine months.

I continue to refine my PPC ad campaign to reduce costs and maximize traffic. At its peak, PPC advertising cost nearly 25% of gross sales. I calculate that advertising can consume a maximum of 8.25%. Year to date, advertising is running me 17.11% of gross sales. I am slowly bleeding startup cash to subsidize the difference.

My top priority, obviously, is increasing sales without increasing advertising costs. To achieve that 8.25% goal, I need to go beyond PPC ads. I know of two ways to do this: Get (free) links from vendors, bloggers, and other sources; and optimize my site further for organic search results. Affiliate marketing is a third possibility, although I’m leery of what seems like a high sleaze factor and the substantial complication of installing an affiliate module. My PHP technology (inability to build HTML pages) and my part-time developer support limit how far I can take these strategies.

My second priority is inventory improvement. I currently invest 50.2% of my gross sales in merchandise. Being a wee bit more than my average cost, that should produce a slowly-expanding inventory base. Unfortunately, I brought in a lot of merchandise before I knew what I really wanted to carry, or what people would really buy, and now I have thousands of dollars tied up in inventory that isn’t selling. I need to recycle that money into new products. I’ve had limited luck selling it off at cost.

My third priority is continued website development. I've still got numerous ideas for site improvements, and a little bit of startup cast left for achieving some of them. There is a major new revision of the underlying Sunshop cart coming out next month.

I’m heading into the Christmas season with an open-to-buy today of (-$42), and at least $2,000 worth of new merchandise and reorders wishlisted, with the Boston Gift Show coming up in a couple of weeks. I cannot sell what I do not have, so I’ll need to infuse more startup cash into new products in the next few months. I’ll pinch some from my development budget (since that’s going so slowly) and some from my marketing budget (since that’s just subsidizing PPC ads). But those are not big budgets.

So that’s where Curio City is today. January through April was discouraging. I nearly broke even in both May and June, thanks to Mothers Day and Fathers Day. July was poor, and August is even worse so far – today is my fifth consecutive day without a single sale; dry spells like that are murder. I expect a minor recovery in September, and then a robust fourth quarter. If it plays out like that, I'll finish the year close to break-even.

If anyone is actually reading this, you could help by freakin’ buying something. :) You could also link to my site, or refer your friends and relatives, or even just click on those Google ads at the top of this page.

Next: So...What Do You Think?

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