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Competing against ourselves on Google Adwords

By on July 25, 2017 in Interesting, Small business, Trends & statistics

If you regularly read our blog posts, you know that, in addition to writing about topics that are helpful for owners and fans of Revere Ware cookware, we also like to write about our experience running an online business.

Today’s topic is Google Adwords, something which is pretty essential for running almost any online business.  If you don’t get traffic, you can’t make sales.

Let’s start with this graph that shows the average cost per click we’ve paid since we started the business, about 8 years worth of clicks.

One thing to realize is that, when it comes to most of the keywords we advertise for, like “revere ware parts” or “revere ware handle” we are the only business providing these parts.  You might think that there is little to no competition for the Adwords phrases we pay for, and you would be right.  By any standard, the amount we pay per click is tiny.  Some businesses will pay tens or hundreds of dollars for a single click, while we spend mere pennies.

But still, a curious thing has happened over the last 8 years … our cost per click has continue to trend up.  (There are a couple of anomalies to ignore.  The large spike near the start of the graph was us weeding out keywords that were far too costly for our business, and the downward trend towards the end of the graph before it started going up again was us again weeding out the most costly of the phrases we paid for.)

How is this possible given that we are the only business that does what we do?  Well, we recently discovered the likely reason.  Check out this email we recently got from Google.

Well that’s interesting, we are mostly competing with Amazon.com for keyword phrases.  The strange thing about this is that, well, we are the ones selling our parts on Amazon.com.  So, it appears that Amazon.com, in order to move more of the business for our parts to their website rather than to ours, is purchasing the same phrases as us.

What does this mean to our business?  At one level, not much.  Our net margins of selling through our own website and using a fulfillment center to ship the orders, versus selling on Amazon.com and using Fulfillment by Amazon to fulfill the orders is about the same.  Well, mostly.  Take a look at the graph of our margins over the last 13 months.

As you can see, our website margins (in blue) are right in line with the Amazon margins (in red), except for the last two months.  Our fulfillment service has a certain fixed cost for using the service (base cost that doesn’t change every month) and then a variable cost per order (handling, packaging materials, postage).  If our website sales get too low in any month (in the summer months we do about half the volume per month than in the winter months) then there aren’t enough order such that the shipping charges sufficiently offset the fixed costs.  This affect is smaller if you consider the full year, but, if the proportion of our sales that are sold through Amazon.com continues to go up, eventually it simply won’t be profitable for us to sell through our own website anymore; we will at some point start losing money on every order.   Selling through our own website is beneficial, as it allows us to keep much more in touch with our customers, and get direct feedback from them, than selling through Amazon.com, so that would be a shame.

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The economics of small business: when a business is a passion

By on March 9, 2017 in Interesting, Memorabilia, RevereWareParts.com, Small business

I often wonder why I do some much for this business when it doesn’t always make economic sense.

Not every business is a profit hungry capitalist empire.  Many small business owners are in business because they are really committed to and passionate about what they do.

Pure capitalism demands that you make logical decisions about revenue and profit margins and only enter a line of business or stay in it when it makes enough money.  But many small business owners got into business not because they wanted to make a lot of money (although making money is nice) but because they felt a need to provide a product or service that they felt people really need.

Often, when this is the case, small business owners do a lot more for their business, in terms of time and money, than the typical business might.

Take our business for example.  We started making replacement parts for Revere Ware, well, because we wanted them, and were frustrated that we couldn’t get them.  Without new parts, our perfectly good 60 year old cookware was useless.  We blindly hoped that there were many others out there that felt the same way we did.

And there are.  We’ve not sure how much we’ve contributed to the rise in popularity of vintage Revere Ware, as evidenced by the increasingly growing numbers of Revere Ware cookware for sale on eBay since we started selling our replacement parts, but we’d like to think we’ve helped people get more pleasure and years more use out of their Revere Ware.

But small business isn’t always about good sense or dollars and cents; sometimes it is about becoming a positive force in that which you feel passionate about.  Small business owners who are passionate about their business will often go much farther than other business owners to provide a good product and service for others interested in what their business is about.

To that end, we’ve spent a lot of time doing things like, organizing all the Revere Ware for sale on eBay so you can easily find what you need, painstakingly searching for and scanning vintage instructions and other materials so we can to help you better understand your cookware, providing DIY how-to guides to help you fix your broken cookware, collecting historical materials, recipes, and such, continuing to add more parts to our catalog because people are asking for them, and spending hours answering questions that often have nothing to do with making a sale.

Economically, this business might not make sense.  With day jobs, small children, and a house under construction, making the time to answer questions or deal with negative feedback on Amazon.com is not always easy.  Our time might be better spent elsewhere.

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World Kitchen unwraps the new Revere Ware site

By on October 20, 2016 in History, Interesting

For a couple of months the revereware.com URL has been shrouded in mystery, with the following message on the site:

revere_website

They recently unveiled their new site.

new_revere_site

They still offer the same limited selection of the classic copper bottom Revere Ware; that hasn’t changed.  They do now show a nice little history of the Revere brand (or perhaps we never noticed that before in their confusing and cluttered site with many brands).

All the hubub seems to be about two new lines they are offering (press release).  The two new lines are the Revere Copper Confidence Core Stainless Steel Cookware and the Revere Clean Pan Hard Anodized Aluminum Non-Stick Cookware.  Both lines include a new feature called Nest&Protect, which looks like this:

revere-nest-protect-example

The hanging hooks for the handles can be hooked over the lower handle to keep the insides of the pots from touching, so as to prevent the outside of the top pot from scratching the inside of the pot it sites inside.

My immediate reaction on this feature is two-pronged:

  • For stainless steel cookware, this isn’t really a problem.  The insides of cookware are going to get scratched and dulled from the likes of acidic food and metal utensils.  And being able to use an abrasive scrubber, like a Scotch Brite pad, is very helpful at times.  I tend to prefer the inside of my cookware to have a uniform dull finish, which is how it always ends up.
  • I am imagining the hassle of always having to unhook those handles to get at the one at the bottom or in the center.

These two lines may be otherwise interesting, but I don’t think Nest&Protect would be a reason for me to buy them.

The other thing that comes to mind is World Kitchen’s long history of producing inferior cookware, opting to lower costs and wring profit by offering a very cheap product while capitalizing on any value left in storied brand names. For example, their picture above of the nested pan cutaways shows very very thin stainless steel on the sides, and, while the bottom does appear to be a bit thicker, I’m not seeing any actual copper in the copper core cookware.

So, I remain a skeptic as to the quality of the new lines.

I was personally hoping that they might improve and expand the classic Revere Ware line they offer, from the very low quality bar it currently meets and the very limited selection.

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What is Revere Ware (aka World Kitchen) up to?

By on July 21, 2016 in Interesting

The Revere Ware brand has been owned for at least a couple of decades by World Kitchen, which owns a number of other formerly iconic brands, like Pyrex, Cornigware, and EKCO. World Kitchen seems to specialize in buying formerly popular vintage brands and selling very cheap knockoffs under the brand name.

Today, something is up with their Revere site.  If you go to the World Kitchen Website and select the Revere brand, everything seems normal:

revere_website_world_kitchen

 

If you previously went to the revereware.com, it would simply redirect you to the above Revere brand page of the World Kitchen website.  However, now, it shows as follows:

revere_website

Just what are they up to?

The Revere Brand has languished over the decades, with a minimal selection of very poor quality cookware.  It was not uncommon to hear stories about the mostly symbolic copper layer wearing off, or completely falling off.  The only piece we could recommend was the tea kettle, as that seems to be a pretty simple piece that doesn’t depend on the thickness of the metal like pots, pans, and skillets do.  All the other cookware was made to be thrown away after a few years (although they still honored a 25 year warranty on the copper bottom cookware).

Could they be planning a return to an actual quality product for the branded cookware?

Update 8/4/16

The revereware.com site still has the above message, but in a new twist, World Kitchens site no longer lists the Revere Ware brand on its main page, and using the sites search feature no longer brings up Revere Ware results.

Screen Shot 2016-08-04 at 8.47.13 AM Screen Shot 2016-08-04 at 8.47.01 AM

The Revere Ware FAQ page and Revere Ware product page are still available via direct link though, and their brands page does still include the Revere brand.

Screen Shot 2016-08-04 at 8.48.21 AM

 

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Mystery copper bowls

By on June 15, 2016 in History, Interesting

Customer Lois contacted us looking for information about these beautiful Revere Ware copper bowls.

My family was stationed at Griffiss AFB, Rome, NY 1962-1966. Given that I believe my mother may have bought them then, but do not know for sure.  There are six of them. Weigh about 9.5 oz ea. Six inch diameter. One and a half inches high. Someone in the past scratched the inside surface of one of them to prove they were solid copper. The red interior finish could be lacquered?

IMG_0363IMG_0359

I’ve never seen anything like them and we were unable to find any historical information about them.

If you have any information about what line these belonged to, when they were produced, what the red finish on the inside might be, or anything else regarding these bowls, please contact us.

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Stainless steel and heat tint

By on May 24, 2016 in Care, Interesting, Tips

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If you’ve ever overheated your stainless steel cookware (like almost all Revere Ware) you’ve seen that rainbow tint discoloration that stainless steel can take on. This isn’t something you can simply wash off.   This discoloration is called heat tint.

Stainless steel works (keep from rusting) due to the addition of small amount of chromium int the steel mixture. (Note that this is a type of chromium that the body needs in trace amounts, not the hexavalent chromium of the type featured in the move Erin Brockovich.)  The Chromium oxidizes and forms a thin layout on the outside of the stainless steel which keeps the iron from rusting.  The nice thing about stainless steel is that this layer is self repairing; if you damage it, more chromium is exposed to air and oxidizes to form a new protective layer.

However, it seems that under high heat, parts of the stainless steel can form a thicker chrome oxide layer. Chrome oxide layers of different thicknesses will show different colors.

In short, the rainbow tint is completely harmless, if not annoying.  The best suggestion we’ve seen to remove it is to use a stainless steel cleaner like Bar Keepers Friend to polish the outside of the cookware.

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The economics of small business: quality, feedback, and ratings

By on March 15, 2016 in Interesting, Parts, RevereWareParts.com, Small business

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In today’s climate of ratings and feedback, small businesses like ours can often suffer at the hands of customers who don’t understand the realities and economics of small businesses, or are simply too lackadaisical to go through the trouble of contacting a seller before they go negative on us.

Take, for example, Amazon.com.  I often order books from third party sellers, and see that most of the time sellers are rated in the low 90’s or high 80’s in terms of overall satisfaction.  On eBay, where I’ve been a buyer and seller for almost 20 years, and have a 100% rating across thousands of transactions, buying from someone with such a low rating seems dangerous.  If someone is rated at 90% satisfaction, does that mean I have a one in ten change of having an issue?  On eBay, where the company forces a resolution process on buyers and sellers, this is often the case.  On eBay, if you want a refund, you have no choice but to go through this process to get your money back.  One person’s bad experience can often be indicative of your likelihood of having a problem.

But on sites like Amazon, where we now do quite a bit of our selling, things are very different, and this leads to a very different quality to their ratings.  Consider the following:

Process: Amazon.com has no process whatsoever that helps buyers and sellers resolve issues.  Have a problem and want your money back?  Sure, no problem, just a few clicks and you are there.  The downside of this is that sellers are often not aware that there is a problem at all.  Looking at returns, there is no way for us to tell that someone returned a part for quality reasons, or simply because they didn’t read the detail and ordered the wrong part.

Quantity vs quality of ratings:  On eBay, which is treated by both buyers and sellers more like a community, people are motivated just as much to leave positive feedback when there is a satisfying experience, as they are to leave negative feedback when there is a bad experience.  On Amazon.com, a very very small percentage of buyers actually leave feedback.  This means that an out-sized percentage of people that leave feedback do so because of a problem (and often a problem they never tried to contact the seller about), which almost guarantees that as a seller, you will find it impossible to have a near 100% positive rating.

Shoot first, ask questions later:  This in my opinion is the single biggest problem with feedback and ratings on Amazon.com.  People simply don’t bother to contact the seller when there is a problem.  Perhaps the norm these days for sellers is that they simply don’t take care of their buyers, and buyers expect poor service.  But for our business, this is anything but the case.  We go to great trouble to try and insure our customers get a good product and have a good experience, and when there are problems, we will do what ever we can to resolve it.  Got a defective part, no problem, we’ll ship you a new one.  Part broke for no good reason a year after you bought it, no problem, we’ll replace it.

That is, we’ll do all that, given the chance.  Most of the time, buyers on Amazon.com will simply return a defective part, leave a negative review, and never ask us for help.

People don’t understand how Fulfillment by Amazon works:  People often leave negative feedback for problems with shipping.  When you order something with Amazon Prime shipping, that means it is fulfilled by Amazon.  People don’t seem to realize that in cases like this, the onus for a good shipping experience is on Amazon, not us; we have no control over shipping.  But we get the negative feedback from shipping issues anyways.

All this mean that it is very very hard for a small seller like us to maintain a good seller rating on Amazon.com.  For example, if 300 people buy something from us on Amazon.com in a month, but only 15 leave feedback:

# negative ratings Seller rating
0 100%
1 93%
2 87%

As you can see, just one or two (undeserved) negative ratings can make us look really bad.  If all of our customers left feedback:

# negative ratings Seller rating
0 100%
1 100%
2 99%

Being a small business means that we can’t provide the kind of product quality that large businesses can offer.  While a large business might have the resources or technology to achieve defect rates like .1% or .05%, we measure ours in the 1-3% range depending on product.  So sometimes a part is simply defective and we don’t catch it before it ships.  But what we lack in big business resources, like many small business, we make up for with great customer service.  We’ll do whatever it takes to fix the problem.

So, I beg of you, when you buy from the marketplace on Amazon.com, give the sellers the benefit of the doubt.  If you have a problem with the product or experience, ask the seller for help.  Give them a chance.  Consider leaving negative feedback only when you’ve exhausted your options and the seller clearly deserves it.

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The economics of small business: why does that part cost so much?

By on March 6, 2016 in Interesting, Parts, RevereWareParts.com, Small business

We occasionally get a complaint from a customer about the cost of some of our parts.  A great example is the hardware set for our single screw handle.

Pan/skillet 1-screw handle hardware set (all sizes)

We charge $2.99 for this part.  Compare this to a standard machine screw, nut, and washer of approximately the same size which you could buy from any hardware store for perhaps 25 cents, or, if you bought a bunch of them together, pennies.

To understand why we charge what we do for a part like this, consider the difference between the standard 8/32 machine screw, washer, and nut you might buy from a hardware store, and our screw, lock washer, and barrel nut.  What hardware you buy from a hardware store is made by the billions.  The principle of economies of scale say that the more of something you make, the cheaper you can make it.

We suffer from the opposite of economies of scale. We make and sell small quantities of something that is not standard and that has to be made specially for our application.  In this case, the barrel nut is not something you can just order; the screw is of a non-standard length.  For each order, we pay quite a lot for the manufacturer to set up and make a run of these parts for us.

If we were to sell tens of thousands of these parts, the set up cost would be spread among many many parts, and be a small part of the cost.  But selling only hundreds or low thousands of these, it comes to dominate the cost of making the part.

So the next time you come across a part you need for a very niche application, to fix a rare appliance, or an old something-or-other, think about how many of these the seller is likely selling and whether it is something you can buy off-the-shelf at any hardware store, and try to understand that the economics of small business sometimes require that we sell at a certain price, or not sell at all.

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