How Much Should a Website Cost?

How Much Should a Website Cost?

It’s a question I’m sure many of you have asked at one point or another. Maybe you’ve pondered the question in a conference room, around a table with your marketing team, your budget spreadsheet displayed on the big screen.

Or maybe you’ve asked it with a little more vigor, and punctuated with an expletive or two, right after getting a quote from an agency like ours. “What the hell? How much should a @#$% website cost?!”

On one hand, it’s a valid question and I understand why people ask it. On the other hand, it’s nearly impossible to answer because every project is different and no one should be selling just a website (more on this in a minute.) 

Even so, it’s a question I’ve thought a lot about myself, since websites are sometimes a part of the package of solutions we sell.

But before I get to my thoughts on that, let’s ask a slightly different question.

How much does a logo cost?

As part of a series of books I read on pricing strategies, I came across a book called Pricing Creativity by marketing agency consultant Blair Enns. He begins the book by asking the question, “How much does a logo cost?”

He answers with the following story.

In 1971, Nike CEO Phil Knight paid design student Carolyn Davidson $35 (about $200 today) to create the mark that is now immediately identified around the world as the Nike swoosh. Logos, therefore, cost $200, at least some of the time.

In 2008, PepsiCo reportedly paid design firm Arnell five thousand times more ($1 million) to redesign its iconic Pepsi logo. Logos, therefore, cost $1 million, at least some of the time.

Even this broad range of $200 to $1 million does not capture the price range paid for logos. You almost certainly know somebody who has paid less than $200 for a logo, and most identity designers know stories of companies paying multiple millions.

Sticking with these well-known examples, however, we will work from the premise that “a logo costs between $200 and $1 million dollars, depending on variables and circumstances.

The rest of the chapter is fascinating, and begins to unpack the concepts of fairness and value, which are both subjective. (He later makes the point that both the designer and the agency felt that they were fairly compensated, and both Nike and Arnell found value in the exchange.)

However, I want to focus for a minute on the central question of pricing theory: How much should something cost?

The answer, of course, is it depends.

Two observations

Over the last twelve years, while working with heavy-equipment, lifting, and construction-industry clients, I’ve come to two conclusions, the first of which will come as no surprise.

  1. People don’t want to pay, let alone pay tens of thousands, or hundreds of thousands, of dollars for a website.
  2. People don’t understand the purpose of a website.

In regards to point number one, it seems that companies in this vertical—at least the ones that do less than about $50 million in annual revenue—bristle at having to have a website in general, and bristle even more when we start to talk about the price of said website.

The general sentiment is: the cheaper the better.

In regards to point number two, it’s those same people, though, that don’t really understand the true purpose of a website—or the true power.

It’s as if they’re stuck with an antiquated view of what a website does, or how it should work, and they don’t understand how websites have evolved to compliment a business in truly extraordinary ways.

The $300 million button

There’s a famous story in the creative industry known as the $300 million button.

A company, rumored to be Best Buy, had noticed a huge uptick in abandoned carts. (Users would click to buy something, adding it to their cart, and then leave without buying anything.)

In response, the company hired a usability research firm to see if they could ascertain what was causing the issue. In the lab tests the research firm ran, users added products to their cart, made their way into checkout, and then froze—and ultimately left.

The reason for this was that before they could make a purchase, they had to register and create an account. During user testing, one of the users said, now famously, “I’m not here to be in a relationship. I just want to buy something.”

The researchers swapped the “Register” button with “Continue as Guest,” and included some reassuring language on what would happen next.

After the change was made, sales increased $6,000,000 in the first week, and, ultimately, led to $300,000,000 in recovered revenue.

Websites have evolved

Not to put too fine a point on it, but that’s what a website can do—and what it should do.

It might not be to that level for your business. And not every business is an e-commerce business. But that doesn’t mean that a website can’t provide the same sort of breakthrough, whether that breakthrough is related to sales, customer service, or something else entirely.

It wasn’t always this way, though. Which is why I understand the question we began with: How much should a website cost?

If you view a website as simply, well, a website, then the answer is “not much.” But what’s the point then? Why even bother?

What I’m getting at is that I think you should ultimately put the same time and effort into the website design and dev process that you would put into any other area of your business, like sales training or equipment purchasing or travel.    

Twenty years ago, websites served a pretty basic function—to deliver information. You could find where a business was, or learn a bit about what it did, but that was about it.

Websites were about validation, or maybe authenticity, but they did little to deliver ROI, either intellectually or financially. 

Things have changed, though. And when done right, constructing a website is now about digitally deconstructing and then rebuilding a business.

In some ways, creating a website is analogous to creating a business plan. It’s what we now do instead of sitting down and writing an actual business plan, one with a competitive analysis and an executive summary. 

Analyzing customer journeys, figuring out what your customers need to know and when they need to know it, telling them your story on your own terms—these are all techniques that didn’t exist in the beginning of the web journey. Back then, we were just figuring out what websites could be.

Now, though, when someone says to me, “I need a new website,” what they mean is “I have a business problem and a website might help me solve it.”

The problem could be related to their brand, or customer acquisition, or even customer service, but finding the cheapest possible provider to build a website—and there are lots of them—won’t fundamentally solve your business problem, regardless of what it is.

Everything is smarter and more sophisticated now, and that’s a good thing.

You can get a graduate degree in user experience (UX). You can use heatmaps to understand what users do on your website pages—where they click, how far they scroll, what they look at or ignore. You can create user journeys and user flows. You can study navigations, taxonomies, and information architecture—and you can do it all to ensure that your website, the first point of contact for nearly every new customer you acquire, does exactly what you need it to do, exactly when you need it to do it.

So how much should a website cost?

It’s an irrelevant question, because you shouldn’t be buying a website in the first place. You should be buying the brainpower of a team of people with specific discipline knowledge who are all working to help you solve whatever business problem you’re wrestling with.

A website might be part of that, but if it is, it should be the last stop on your journey, not the first. The website is like the final, climactic scene of a movie, the thing that happens right before the central conflict is resolved.

It simply won’t make sense if you haven’t seen everything that comes before it. But if you’ve paid attention and invested your time and money, the payoff will be undeniable.

So before you start looking for a web designer or an agency, before you ask the question you can’t wait to ask—How much should a website cost?—ask yourself this: Where is our business now, and where do we want it to be?

Once you answer that question, which is absolutely the question you should begin with, you’ll have a much better idea of where you need to start. And you might even find that you no longer even need to ask the website cost question at all. 

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