This article was previously published in the magazine REIN Life.
Dissecting Cost versus Value
There are a lot of free tools out there today that can help you get a website up and running. WordPress is one of the most common content management systems for building websites, and it’s free. There are also many themes and templates available to help you put up a website pretty cheaply, if free is the answer you are really looking for.
But let’s look beyond free. If you canvassed 10 business owners right this minute, 7.1 of them would have a website, according to a Clutch survey published in March 2017, which reported that only 71% of small businesses in Canada today have a website. And if you asked those same 7.1 business owners if their website was helping them achieve their business goals, they would pause and, in most cases, say no.
Yet Forester Research has predicted that Canadians will spend $39 billion online by 2019, representing 9.5% of all retail purchases in Canada. In the business-to-business space, we estimate that percentage to be even higher; various research reports cite estimates as high as 98%.
If you do not have a website or you’re underutilizing your website, you first need to understand the value versus cost to your business before deciding how much of an investment to make.
What is the value of a website?
Assuming your website, at the very least, contains:
- A representation of your brand
- A description of your company
- A way to contact your company
- A detailed explanation of why you should buy from your company and not the competition
Assuming your website has all of the above, assign to that a value of $10,000 and then do the following:
- Add $30,000 if your site provides a way to interact with your company, such as a download, form, quote tool, or mechanism other than just a number to call.
- Add $20,000 if your site uses email marketing to push out content such as press releases, blogs, or newsletters to alert people to new products or services at your company.
- Add $40,000 if you are actively alerting people via social media, directories, portals, or other places online on a weekly basis.
TOTAL VALUE = $100,000
1. If you were to hire a designer to build you a glossy 20-page 8″ x 10″ brochure using professional copywriting and design services, and you printed a thousand copies and distributed them across the geographic territory you serve, you would likely pay about $10,000. But your website is performing that same function and working much harder for you from a distribution perspective. The average website receives one thousand visitors per month and is open for those visitors 24 hours a day, seven days a week. Brochures, flyers, and pamphlets cannot compare to the reach of today’s website.
Using your website as a way for people to contact your company and interact with your business is the equivalent of a full-time receptionist and a part-time sales rep. Offering sophisticated ways to connect with your company online, including tracking and analyzing content popularity and time spent on page, is an excellent way to gauge how well people understand your company and what you do.
2. If you are also using your website and web presence to push out content and connect with unknown prospects looking for your products or services, you are building a lead-generation engine for your business. Telemarketing, direct mail, print advertising, and other traditional forms of marketing cost much more in terms of time, money, and resources, and typically produce poorer results across the board.
3. If you are finding other places on the web to go and actively network online and drive traffic back to your website, this is the equivalent of about three people in your company networking and trying to connect with prospects. The real cost of this effort is one that doesn’t get tracked at many companies, but it’s costly and doesn’t help the business scale.
You need to look at your website as an employee—an employee who is there 24 hours a day, seven days a week, working hard for you. How much would you invest in an employee like this?
Even if you are a business that doesn’t have salespeople, support staff, or marketing material, there is still a hard cost to selling something. The things you are doing today to support the sale of your product or service can be supported more effectively with a well-organized website and a detailed digital marketing strategy.
If you are a business with more than $100,000 in sales, you should be spending at least 5% of your annual revenue on the resources and costs associated with a digital marketing strategy for your business. You may have to stop doing some other things with respect to sales and marketing, but over the long run, I guarantee the results will be better and the return on investment greater. If 75% to 98% of people start their buying journey on a website, why would you cheap out?
Why aren't business owners stepping up?
Many business owners we speak to tell us that the reason they don’t spend time, money, or resources to improve their websites and the digital experience for their potential customers is that it’s hard to figure out what to do online and who to hire. We tend to agree. There are a lot of people today who are selling digital marketing solutions that seem like cost without ROI. This is because they aren’t tied back to business goals and objectives.
When you take the time to discern who you are selling to and how your customers/clients want to interact with and learn about you online, your ROI goes up tenfold. So instead of just building a website, think about building an online lead-generation and lead-nurturing tool that starts, enhances, and fulfills the buyer journey.
Whether you like it or not, today’s reality is that people are looking for you online. A website costs as much as you are willing to spend on it, but are you investing in a brochure, or a sales tool? There’s a big difference.