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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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Friday, October 01, 2010

It's Not Me. It's You. or, Buy Stuff, Dammit!

Year-over-year growth slowed in July and turned slightly negative in August. In September, it crashed. Let’s cut straight to the grim numbers:

Total income: -20.3%
Total COGS: -12.7%
Payroll: +34.8%
Net Income (Profit): -112.3%

Year to Date:

Total income: +21.2%
Total COGS: +35.2%
Payroll: +40.3%
Net Income (Profit): -103.8%

How can I sugar-coat that? September 2009 kicked ass. September 2010 was on the weak side of normal. This month was doomed before it even started. Last September brought a $1,100 lighted cap sale from Staples and another $500 cap sale to a business in Texas. Three other days during the month broke $300. This September delivered only one day over $300 with no big institutional sales.

If you remove those two big lucky strikes from last year’s sales, this month was about flat with LY. It’s a very healthy increase from the more typical September of 2008. As reassuring as that is, September still came in $1,500 behind last year. At least (the ultimate in sour grapes) I’ve set a more realistic target to beat next year!

My own pay is still 40% ahead of LY. Sounds great, huh? Yeah, but big percentage swings often mask small dollar amounts...and the "extra" pay comes directly out of my year-end profit-taking bonus. The bottom line is slightly negative right now when it should be solidly in the black. Cost of Goods Sold is running way too high due to bad luck and bad judgment: Two floods, two thefts, and two write-offs of dead merchandise (greeting cards and magnets, gone forever at last).

At this time last year, Panther Vision’s third-generation Power Cap arrived, forcing me to discount my old 2-LED caps. This year, my old mainstay is drifting nowhere. The wind has gone out of kite sales, too. With no hit product driving business this year and no capapalooza, October’s prospects look dim. BuckyBalls are languishing so far; so many competitors are bidding up keywords so high (a buck a click? Come on) that I effectively can’t advertise them. Incidentally, some manufacturers and specialty retailers buy keywords at a loss to freeze competitors out; Looney Labs does that with their Fluxx games because they favor b&m stores over web retailers. You can't possibly make money paying $1 per click for a $15 product.

My comfortable lead over LY is almost gone and I have no confidence going into these critical last three months, but at least I’m still (barely) ahead of my 15% planned increase. There’s little I can do. My buying frenzy is over for now; I’m well-stocked on everything that ought to sell and my OTB is more than spent. Like, WAY more. Cash flow – including the money that I had squirreled away for a rainy day -- is $120 in the red right now with $1,000 in payroll taxes due in two weeks. Today I added about 100 new keywords to Google AdWords, deleted some badly overpriced ones, and raised my daily budget. I’m flogging the new Microsoft adCenter, too, but that won't amount to much until they finish digesting Yahoo next month.

Come on, shoppers, are you even listening to me? Another weak consumer confidence report implies that you’re not. Consumers won’t consume until the job market brightens and businesses won’t hire until demand picks up. I’ve already explained this: Somebody’s got to blink, and it’s not going to be the corporations.


  1. They might also buy 1$ a click because it gets people into their website and likely hood is, average customer buys more then 1 item. If their calculations show that acquisition of new client is worth at least 1.50$ to them in ppc, the they are more then happy to spend 1$ per click.

    I spend around $1 per click on my leads, and it does dual option it cuts out competition and maximizes my conversions. what most dont know that each visitor to my site is worth $7 to me, which should explain why i am more then happy to spend that 1$.

    whats each visitor worth to you? that's the main question that will help you establish measurable value of each visitor.

  2. Interesting perspective. It's not quite relevant, though, because our businesses are so different. You are pitching the same service (product) to all visitors with a small number of web pages, whereas I have hundreds of products and pages. All of my pay-per-click visitors land on a specific product page; most either buy what they came for or leave...only a minority browse my store beyond what they came for.

    Despite that key difference, "What's each visitor worth to you?" is an interesting thought experiment that I should calculate and bear in mind when setting bids. Thanks for posting the suggestion.

  3. Andrew2:52 PM

    When i clicked on the BuckyBalls link, a username/password request window popped up. I closed the pop-up and everything seemed fine, but it was an odd hiccup.

  4. Thanks for tipping me off to that, Andrew. I hadn't seen it since I'm always logged in. Something about the video embedded on the page is conflicting with a layer of security that I added a couple of weeks ago. As far as I can tell that's the only page that's affected. I'm on the case!


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