Planning for website and online costs in 2019

This is our fifth annual study on website costs. Every year we take the trends in technology and marketing and apply it to reasonable website project and ancillary online costs for a small to mid-size business.

company size and web costs

Size does matter

There is diversity among businesses out there, ranging from mom-and-pop to large service companies, manufacturers, and e-commerce. So right from the start, we want to eliminate the small, under $100K annual revenue business from consideration. For a business of this size, they probably don’t have the annual budget to effectively leverage the combination of technology and marketing channels required for meaningful growth.

wix and squarespace hosted solutions

The hosted website solution

A small business in this category would be best-served by using a hosted website service like Wix.com or SquareSpace.com. There are also many website building services that can provide a low-cost website for under $2,500. Be forewarned that you get what you pay for, and for most of these hosted website solutions, the following conditions apply:

  • They “own” your website so you can’t transfer it elsewhere.
  • They will bill you a significant monthly fee to cover the low cost of building your website.
  • They will bill you for standard “add-ons” and features like SEO.
  • They may not be responsive when you need help.
  • They will limit the website design and features to what’s available in their template.

That being said, this option is still quite viable for smaller businesses that don’t have a detailed marketing strategy or just want “an online business card to refer clients to”. If you would like more information about these hosted website services, we have a great article here.

The freelancer or offshore solution

Another low-cost website design option is to go with a one-person shop, a freelancer, or an offshore solution. If you have any type of business then you probably receive spam emails often from these types of companies offering extremely low-cost deals. We have seen many horror stories related to selecting these low-cost web vendors. If you’d like to learn more about the dangers of offshore please give us a call.

Budgeting for reasonable online costs

To really support and grow a business, the rule of thumb is to allocate 12 – 20% of your gross revenue for marketing. An aggressive business or a business in startup mode will want to get closer to 20% so they can gain traction and become more visible to their target customers in a shorter period of time. In this scenario, we will consider a business with gross annual revenue of about $1,000,000.

Let’s assume the low-end marketing budget of approximately $120,000, using our formula of 12% of revenue as the marketing budget. This would encompass:

budgeting for online costs estimate
  • Online marketing through paid ads.
  • Website costs for management and maintenance.
  • Social media and other channel costs.
  • Print ads, and printed collateral such as business cards, brochures, etc.
  • Trade shows & industry events.

For a business that requires all of the above, you can see that a 12% budget can be fully spent easily, especially if the business employs full-time marketing staff. Depending on the size of the business, it may make more sense to go with a digital agency for most online services rather than trying to bring that expense in-house.

There is no strategy better than a holistic marketing strategy.

No matter how you decide to move forward with your website and online marketing it is critical to employ a holistic strategy. This is one where you take into account all of your marketing efforts, from events to blogs, emails, social media, LinkedIn profiles, ads, etc. This way you can coordinate and leverage the content across multiple channels for maximum effect. If you don’t practice a holistic online strategy, the risks are:

  • You will waste money, time, and effectiveness because you lack an efficient unified approach to your marketing efforts.
  • Your brand will suffer due to inconsistency in the manner it is presented.
  • Your business will suffer due to lack of unified marketing analytics, so you won’t know what efforts or combination of them resulted in the best ROI.

Over the years we have met many business owners and managers who have no idea how their marketing resources are doing and how it is impacting their business. We have talked with smaller businesses that employ a variety of freelance services for their social media, website, and public relations – but they lacked a unified strategy so none of their freelancers knew what anyone else was doing. Even worse, we’ve seen cases where the business owner had no idea what they were paying for. One solution for this is to streamline the online services to one agency that has the expertise to manage all services from one hub.

We have also met with multi-million dollar businesses that rely too heavily on their internal marketing staff for everything including presentations, social media, website, events, etc. This over-reliance on internal staff handicaps the business because no matter how competent the staff is, they seldom have the time or expertise to properly manage all their duties. The solution here is to have the internal staff focus on their area of expertise and also to be the manager of external marketing resources.

range of website expense graph

So how much does a website cost in 2019?

The majority of websites we design for small to mid-size businesses fall between $15,000 and $40,000. These websites usually have the following features:

  • Clients are service businesses with minimal e-commerce requirements.
  • The website is based on a customized WordPress or Drupal framework.
  • The scope of work includes everything from strategy through design, coding, SEO, and client training.
  • Does not include new branding, copywriting, photography, or videography.
  • Does not include post-launch services such as website security, maintenance, or marketing.

Having a website is akin to owning a car, you still need to cover the cost of gasoline, maintenance, accessories, etc. For a website, that means the following expenses should be included in your annual budget.

car is like website ownership

1. Website Application Maintenance

  • Hosting – you can get excellent hosting services for under $35 a month, this includes backups, caching and extra security. Our go-to hosting company is Pantheon.io.
  • Framework upgrades to keep your version of website software(WordPress, Drupal, etc.) up to date and secure from hacks. We offer a monthly SecurePack that includes this service along with other benefits.
  • Licensing costs for any plugins and extensions that improve the functionality of your website.

2. Content Development

A website is an evolving communication platform that should keep up with the events within your business and industry. Here are some of the content costs and efforts you should include in your annual budget.

  • Content creation in the form of blogs, articles, or case studies. These are important for your clients to see and also for improving your SEO and marketing reach.
  • Content edits to your core business staff, products, & services.

3. Online Marketing

Having a website is a core part of your online communication but it is only effective if you are continually driving your target audience to it so they can become educated and compelled to use your business products and services.

  • The production of marketing content such as ad and social media campaigns, these can include photography, graphics, and video.
  • A budget to publish ads online using services such as Adwords and social media ads.
  • The cost of analytics and reporting so you can determine the effectiveness of campaigns.

breakdown of web costs

Breakdown of website post-launch costs:

So once you’ve built your $15K – $40K website, figure on allocating the following percentages of your budget for these key efforts:

  • Maintenance: 10%
  • Content Development: 25%
  • Online Marketing: 35%
  • Management and reporting: 30%

Every business can be differentiated by their brand, business focus, and value proposition. No matter where your business fits within your industry, don’t skimp on your online budgets. Find a professional agency to be a key partner in handling your online presence. If you have any questions about website budgets and expenses in 2019, contact us at Executionists for quick, no-nonsense answers.

Richard Parr
by Richard Parr
Posted: January 2, 2019

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