Here Come the Clouds

The promise of Solar Powercaps was clouded when I created ad groups for them on Google and Microsoft. First-page placement for the best keywords costs more than $1.50 per click. I’ll sometimes bid as much as 45 cents for a high-priced product, but anything higher than that is a losing proposition. A 40-cent bid with a 2% conversion rate costs $20 to land a sale. At $1.50 I’d have to spend $75 to land that same sale. Since advertising is budgeted at 10% of gross, my average sale would need to be $750 to justify that outlay.
It’s not. I’m sure I’ll still sell the odd solar cap now and then, but it’s not going to be the hit that I had hoped for.

So let’s follow another dashed hope with a portrait of mediocrity.

January & Year to Date:

Total income: -20.0% (-$1,201)
Total COGS: -33.8%
Payroll: -0.6%

Marketing: -17.7%
Net Income (Profit): +20.8% ($121)

The month did fine until Jan. 24. What happened on that day? Beats me, but daily sales fell from triple to double digits and didn’t get back up again until yesterday. General Valentines Day traffic didn’t swell the late-month numbers and a Valentines-themed newsletter had no effect, as usual. I’d have finished even with LY were I not up against last January’s $1,200 bird kite sale.

At least Cost of Goods Sold fell farther than sales did. That’s something. Unfortunately, marketing is not down by nearly as much as sales are, and that’s something else. Profit is actually up by a smidgeon, though, and that’s really what it’s all about. 

So what to do? I turned keyword bidding back over to Google’s automation. Although the purpose of Google’s algorithms is obviously to make profits for Google, they worked out pretty well over the Christmas season. Let’s see if they can do as well when traffic is weak.

I do have one big trick up my sleeve for February. Unfortunately, last February was another unusually good month, so I’m pessimistic. 

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A $300 lighted cap sale to a Canadian saved this month’s numbers, but I might have to cancel and refund it next week. Last May the USPS banned international shipments containing batteries. Some websites report that they eased that prohibition last November to permit batteries that are installed in products. However, the USPS website disagrees. I’m pretty sure their information is just wrong; shipping the caps with batteries is probably fine, but I’m hazy on labeling requirements. I’m waiting for USPS to clarify by email -- this issue comes up a few times a year, so a definitive response would be welcome -- but I don’t have much confidence in the accuracy of their reply. I just hope they don't consult their own website!

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The Cool Baseball Necklace is history. I suspected as much when I couldn’t reorder the largest size last fall and the vendor couldn’t tell me when she might get any more. Now her website is gone. They brought in $1,100 over the two years that they lasted. 

As long as we’re saying goodbyes, Funkeyboard keyboard stickers are also toast after delivering $2,100 over three years. I won’t miss them terribly; they were a marginal product at a low price and the USPS's 0.75" minimum package thickness requirement made them inconvenient to ship, but the markup was good and, hey, $2,100!