We have a store selling lace products on the Internet. We sell table
lace and tapestries imported from Germany and also domestic ready-made
curtains from Heritage Lace. The web store has been running for over
five months and we have had very few sales. This question addresses
the problem of converting more visitors to buyers.

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Sales strategy:
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To get qualified visitors we've been running two Google Adwords campaigns. 

One targets "german lace" with these keywords:
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battenburg lace
heritage lace
lace curtains
lace doilies
lace fabrics
lace tablecloths
plauen
table lace
tablecloths
tabletoppers
wall hangings
wall tapestries
-laces
-lacing
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The target url is http://www.glockenspiellace.com/store/dynamicIndex.asp


The other targets "tapestries" with these keywords:
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tapestries
wall hangings
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There is a text ad pointing to
http://www.glockenspiellace.com/store/listCategoriesAndProducts.asp?idCategory=19
and an image ad pointing to
http://www.glockenspiellace.com/store/viewItem.asp?idProduct=232

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Statistics:
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The german lace ad has had about 1500 clicks with 5 sales and the
tapestries ads have had about 50 clicks with no sales.

The net result is that we're losing money because the sales are not
paying for the adwords expenses. I estimate that we need to increase
our conversion rate from presently 0.33% to at least 1 to 2% to start
making a profit.

My question is in two areas: 

1. What should be changed in the advertising? Are there better
keywords we could use? Should we tweak the copy in the text ads?

2. Suggestions for changes in the website. Navigation, trust building, copy, ...

Please address the specific issue of sales conversion. I will leave
the problem of getting more traffic for another day.