Calculating a Websites ROI
Now that’s an almost impossible task… where to start? Have you ever done this and if so what criteria did you use?
I guess the easiest first question – is it an all new business or website? or are we talking about an existing website that may be due a redesign or upgrade.
The last part that should be looked at – is what is a reasonable Rate of Return? If you invest £1000 – is a return of of £1100 enough.
Or are e just looking at this in completely the wrong way –
Start at the beginning
A new Business or Website… you are starting up, your website will be an asset to the organisation and as such it will have an upfront cost, ongoing cost and also a depreciation value. You can treat the website in the same terms as a car. Accept you cannot do this for Company Accounts.
You can offset the set up and running costs, but you cannot depreciate a website.
Basic Costs
Roughly these are the sorts of average costs you might be looking at for a website today:
- Basic 1-5 pages – probably around £60-100 per page – under £500
- Medium sized with some admin control – £1000-1500
- WordPress (using a pre-built Theme) – £1800-2500
- WordPress (customised) – £2800-2500
- e-Commerce – £3500 up to £10,000
These are the rough captial outlays you might consider for a new website.
However, this is completed by a
These services cost between £10 and £30 a month – making them far less expensive in the short term.
Pros and cons of the two systems is that with the cheaper ready made websites you can be restricted by platform you have choosen, they just is not the flexibility, however that can be more than made up for if the money works better.
It should be noted that creating a customer website will required hosting and that is usually £5-50 a month… so really the Ready made options can be made to pay for themselves.
Eyeballs Count More for the ROI
The situation used to be to create a super flash all singing all dancing website that would bring the customers flooding in. But that approach being wildly more expensive has never really worked.
Eyeballs matter more… when you look at eBay or Amazon you don’t see beautifully designed websites – you see functional money making machines that answer peoples problems.
And that is the key – you’re not selling your services or products – you’re making other people’s lives easier.
Our rule of thumb is whatever you spend on your website you should look to spend on getting eyeballs to look at the website.
Actually attracting traffic to your website is the key component – get that right and the ROI of the website shifts dramatically.
Giving people what they want
We’ve seen situations where companies constantly market their flagship products and services, always bring attention to what they think people need. When in truth the best sellers are some widget on page three. People just love them.
If our clients allowed their visitors to their website to dictate what products or services should be shown out clients would be collectively a lot wealthier now.
A website liturally allows you to ask the your customers the questions – do you prefer Red or Blue, it’s up to you if you decide to listen.
It will also affect the ROI in a dramtic way.
Return of Investment
It’s nigh on impossible to quantify the actual money made from the website in it’s early stages – later on once up and running you might be able to say, promotion, management and maintenance of the website cost X and we sold Y, but that often does not apply to Service based business.
The analnology of a car might work better for you, the website is an Asset – if you drive a Porshe you stand a better change of converting the people you meet into clients than you would if you drove a robin reliant. In truth most of us drive Ford Mondeo or have a WordPress website.
A website is like a computer – it costs about the same or you could buy it on the never never. But it’s not about what it looks like – it’s can it do the job.
If the answer is yes then you’ll get the productivity you require from the website. And that ultimately is what counts.
So the full answer to the question is less about the website and more about the aims and goals you want to achieve. Giving your customers or clients the products or services they want is ultimately the best way to sell your business.
If you can do thay – then in fact it will not make any difference at all how much you spend on your website… the ROI will actually be many 10s times over.