Part II: Planning for Success - How Much Should You Pay For a Website?

What are the Costs of Building a Website

by Pauline Sugarman

Created July 2004; Revised February 2006

If you have started to speak with Web Designers or Web Design Agencies, you will notice a wide spectrum in the pricing of web design services. Some may quote what to you seems rather high, while others will charge what can only be called a bargain.

What are  the costs of building a website and how do you know how much is appropriate to pay for your website? How do you know when you will get the best work for the best price?

Before looking at the costs of building a website, it would be very helpful to review a couple principles that can help you get the most of your investment.

Be Very Clear About Your Goals

This one step can save you not only unneeded grief in failed attempts to reach your audience but also much cost.

A good web designer should be able to help you state what your business mission and goals are (they may charge for this service, but it is important that they have these skills) and what part you want your web site to play in fulfilling these goals. This includes helping you to clarify who you are trying to reach, what their needs are and what benefits they are seeking.  By stating what part the web will play, it is important to be realistic about how important - how large a part - the web will be in reaching your goals. For some people the web is very important to reaching their consumer groups and has a great impact on their bottom line.  For others, they may find that other marketing avenues are much more essential to obtaining and keeping loyal customers.

Once you are clear on your goals, you will be able to plan what elements your website must contain to reach these goals.

Integrated Marketing

The internet is just one of many marketing mediums available as possible avenues to reach your consumer base.   Most businesses use more than one type of medium to create their optimum marketing strategy, ideally each supporting the other in a 'symbiotic' manner, working together to enhance the effectiveness of each and therefore increasing the success of your marketing plan.  This is called Integrated Marketing or Cross Channel Marketing.  You will hear it mentioned more and more as large companies and small evolve in their understanding of how to incorporate the internet to help them reach their marketing goals.

The Internet Costs versus Other Marketing Mediums

The internet differs from other mediums in terms of the timing of outlay of funds.  Magazine and newspapers or television spread their fees over time.  That is, each ad may cost less, but the cost is incurred every time the add is run.  You may have to pony up every month for the ad to keep running.  Whereas the costs of building a website are mostly up-front. That is, the costs are incurred once, after which, with the exception of modifications or updates, you should not have many other costs to pay. 

Web design work is also different in that there are many layers, similar to building a house, that go into creating a successful site.  You may not see all that goes into building a website, but each aspect must be skillfully completed. The target audiences must find the site appealing, it must function properly and at the same the search engines must be able understand the content so that it can be indexed and included in the desired search results.  And each layer takes time and skill. 

While there are always exceptions, when pricing web design services, remember that most websites, if designed and built to meet the most current web standards, should meet your needs on average for three years.

Defining your Budget

Therefore, once you have a clear idea of of your marketing goals consider:

This is not written in stone. Your website may not need a large revision for four or more years. Or it may need constant revisions.  But these guidelines should start to give you an idea of what is appropriate when pricing web design services given your web design budget. 

You may find that the web plays a much larger part, or much smaller part in in reaching your income goals. Your customers may truly not be 'web people'.  They may want one-on-one interaction or come to you from word-of-mouth.  Or, the web may grow in importance with the years and more business will come to you than expected.

Return on Investment

If you invest in a website, your goal is to see a return on your investment.  This took a while for people to realize when the web first started taking off.  In fact, it is what lead to a great extent  to the demise of the web boom in the 90's.  Investors kept injecting money into projects but rarely saw any return on their investment.

If you are clear on your goals then you will know what you are wanting to achieve with your site, what type of "return" you are wanting. For most people this is increased sales for increased profits.

If a web designer has a track record of creating good returns on investments, and they can show you this record, then you have a good idea that your web site will also be a good investment. Paying out $7,000 + for a website that pays for itself within 5 months is an excellent investment. After it has paid for itself, you will have powerful advertising tool working for you for free. Conversely, paying someone what seems like a good bargain, when you do not receive a return on your investment, is a sad affair. To a large extent it's like throwing money away.

What are the Costs of Building a Website?

How much can I expect to pay? This will differ, or should, depending on a web designer's experience, the skills you are asking them to use in creating your website and whether you are working with a large advertising firm or a Web Boutique (see Choosing a Web Designer).  You may find, when pricing web design services, someone who is still building up their portfolio who will charge less but give you a beautiful website, or you may choose to go with someone will a large portfolio who will charge top dollar for their services. (See also Choosing a Web Designer Check-list.)

Generally though, the costs of building a website will range charge from $45 to $70 per hour for a web designer's services.  Flash animation, videos, mobile authoring and Database work will all generally cost more ($60 to $100 or more per hour).  So will specific services such as, Marketing Strategy Planning, Search Engine Optimizing (SEO) services for higher ranking in the search engines, linking campaigns and PPC campaigns.  SEO Consultants may charge as much as $7,500 to "optimize" a site depending on the size and depth of the project.

Most web designers will bid for a project. Again, if you are very clear what you want to accomplish, a web designer should be able to tell you the costs of building a website to meet your needs.  Just remember to look at the contract and find out exactly what services will be included. If you are looking at pricing web design services from more than one designer, try to compare 'apples for apples'.  If you know you want specific services included, make sure each bid includes all the costs for these services. You may find that while you eschew the most expensive bid, the least expensive will not give you the website you want to meet your needs.  Again, we come back to goals.  Focus on your goals and then review the proposals to see which will work the best for you.

In the next article, we will review the fundamentals of site usability to ensure your site is as easy to use as possible......

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