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How much for a website?

There is no such thing as the right price for a website. You can have something for any amount you budget. 

It may be better to shift your question to “Why do I want a website in the first place? What do I expect to accomplish?” Once you find your answer, it will be much easier to assign a budget that makes sense for you. 

A quick example: 

Say you want to build an eCommerce site that will bring in $200k in revenue per year. In that case, it makes total sense to invest $20k to $50k to have it built professionally.

Another example:

You are just starting, you don’t have an audience yet, and you need to test an idea. The expected revenue from this project could be as low as ZERO. Paying 20k for a test doesn’t make much sense now, does it? Perhaps this is a good situation where you need to look at some free options first. 

How to think about website costs, price, revenue?

A common misconception that I see is to think that all that you need is the web-design, which means a page on the Internet that looks like the picture in your head. There are plenty of tools to help you build that pretty picture for free, but once you have it, what will you do with it?

The most significant investment in building something is in marketing—finding the right people and presenting the right message for them. Once you figure out what you want to create, for whom and what it is the best way to engage with the audience, the web design part is super easy: mostly fill in the blanks. 

To better illustrate this, let’s have a look at some options.

The Free Website

With today’s tools, you can have a professional-looking website for free. This approach is an excellent way to test your ideas with no dollar investment. Use this to build up your writing skills, get some feedback on an idea you have in your head, start a conversation about the thing you want to create and get a feel for what it means to manage a website. You may discover that you are sitting on a gold mine or that nobody cares.

The $250 Website

You have now moved to a paid hosting company and under your own domain name. 

The advantages you get are:

  1. you are signaling that you are taking this more seriously – if you invest in hosting and a custom domain name – that will set you apart from everyone using the free places. 
  2. you begin to build your brand – as people will now use your domain to get to your content.
  3. you get more customization options and more flexibility.

You may still not make money from the site, but the $250/year investment is not too big, and you are learning a lot. 

The $1,000 Website

At this point, you have an audience that trusts you and visits your content, and you believe you could help them with a paid solution. You deploy an e-commerce software on your site: a shopping cart (like WooCommerce), a payment gateway integration (like PayPal), a newsletter service (like AWeber), and maybe video content (on YouTube).

If your content is engaging and consistent, you may recoup your money in one year, so you are on to the next level. 

The $5,000 Website

At this price point, you already have customers, you know what they like, you know what they would like improved on your website, so it makes sense to buy a custom design to solve these specific challenges. 

You are also doing much better automation and integration of your tools. You will make regular backups of your content and customer list because now a loss of data will be costly. You are building up your analytics to help you make better decisions in the future.

You do expect to make somewhere between $30k to $60k per year in revenue.

The $10,000 Website

At this stage, you begin to optimize your site. You think about speed, caching, search engine optimization, user experience improvements, tracking your metrics. You are doing tests with your design and your messaging to see what works best for your audience. You may also choose to move away from platforms like WordPress and into dedicated software that better fits what you and your audience want to do. 

The revenue expected is between $80k – $120k. 

The $50,000 Website

Here we are usually talking about a major overhaul of your online presence. You will do much research and many tests, and studies about your audience and with your audience to make sure this next level is a perfect fit for them. You may hire a branding agency to fine-tune your online identity and create a unified feeling experience for your users, regardless of where they find you. Things like your logo and color scheme become very important. 

You will get automatic publishing and tracking tools to update your content across social media. You will build a managed community for your audience, where they can connect and learn from one another. You will have a team of people around you, helping you manage all the systems. 

A big part of this investment goes into research and marketing. If you get that right, then choosing the correct technology is very easy. Choosing the wrong technology can be very costly at this stage. This is why it makes sense to research first and build later.

The expected revenue is over $300k.

Conclusions

You can use the value you expect to create with your website and form that work out what kind of a budget makes sense to invest in getting there. 

The bulk part of that investment will go into marketing:

  • Understanding your audience.
  • Making you a better communicator.
  • Spending time engaging with your community.
  • Finding better ways to help. 

The Buyer decides what is worth to them

“The price you’re charging for this is ridiculous!”

“Are you trying to rip me off?!”

“What?! Is this made out of gold or something!?”

“How can you live with yourself when you charge ten times it costs you to make this?!”

If you have ever been in a position to sell something, chances are you have heard some or all of the above. If you haven’t, you are on a race to the bottom, competing on who is the cheapest.

Who decides if the price is right for a product or a service? 

What is the correct value?

The answer is that a buyer and a seller decide.

If the buyer feels that she gets more value than the is paying, and the seller feels he is making a profit from the sale, then the price is right! And the price is right for that context only.

For a different buyer or another seller, the price may very well be “ridiculous!”

I have heard many times, and I also used to believe that it is a shady practice to price the client, not the solution, meaning: to change your price depending on the person sitting in front of you. 

Does this feel like a scam to you? Do you want to know the price upfront, and do you want to know how much the other person paid, so you get the same price or better?

If you feel that way, then you are shopping for price, and not for value. And that is OK. I believe everyone is doing that in some areas of their life.

But if you are shopping for value, then the price is not that important.

How can that be?

If the value you are getting out of the product or the service is greater than the price, it is always a good deal for you, regardless of what someone else paid for it. Of course, you can still negotiate and try to maximize the value over price ratio, but ultimately it is the value you are after. If you could spend 75 cents to make a dollar, you would go for it!

To understand this better, let us look at an example from photography.

You went into the jungle and captured some amazing bird photos. You had to pay for the trip, the insurance, the equipment and also pay yourself. So there was a cost incurred by those photos.

How much will you sell them for? How will you decide what the right price is?

Let’s say you decide $200 for each photo. That is your price for everyone.

Now a blogger comes along; they look at the photo and think: “My God! What a ridiculous price for a picture! I can get a free one from Unsplash. This guy is crazy trying to sell for this price!” Maybe you will think: that is OK! They don’t understand the costs of making these pictures. It is still a reasonable price for my work.

Next, National Geographic comes along and purchases one of the images and the right to print it for $2,000. It gets on their cover, and it becomes such a hit that it becomes a “National Geographic Classic.” Does the $2,000 still feel fair to you if sales increased by $200,000 for the magazine because of the cover?

How much would it cost you in time, tools, and resources to draw the Nike logo? Can you put a price on that? How much is the Nike logo worth today? Is that close to the price you came up with?

We all want to be good fellow humans. We want to help out. We want to be seen, appreciated, and valued. And we want to thrive.

When you allow someone else to judge you on your value and make you into a horrible person because of your price, you get into trouble simply because some of the people you will encounter will assign a different value to you and to your product in their eyes. 

So you may be horribly overpriced to them. And then, they are not your customer. There is no need for you to lower your price or to feel like a bad person, just because someone could not see the value in what you do.

In the same way, you will not be able to serve everyone. Some of the problems are too small for you to handle, and you need to refer those out, or just say “no.” And some of the problems may be too big for you right now, and you also need to say “no” instead of over-promising. But in between those, there is your range: a range that will grow with experience and personal development.

I still believe luxury goods are a scam, or that some people just gave in to the “marketing” and bought a useless product, but I am wrong. The truth is, none of the parties would have agreed to make that transaction if they did not feel the price was the right price. I may not see the value, but that does not mean that value was not there. I simply value other things.

Don’t allow others to push their value onto you. And mirroring that, accept that other people value other things. And all that is OK.

Credit: Thanks, “The Futur” for their inspiring videos.

If you had to charge ten times as much

This is such an interesting question because it asks for ten times, not twice as much. 

Asking for twice as much can trap you into thinking: 

  • I will work twice as hard! 
  • I will double the quantity of whatever I am offering! 
  • I will simply increase my prices, lose a few customers but keep the premium ones. 

None of those strategies really work when you need to charge ten times as much. Something else needs to change.

I have not found the “right answer” to this one, just yet.

But somethings are obvious:

I cannot work ten times more hours or put in ten times the effort. With 24 hours on any given day, that is simple, not possible. 

Ten times the quantity may also not be possible, not to mention that the customer may not be interested in that much more quantity. 

So what can it be? 

On the same airplane, different people pay different prices. And yes, you can find a ten times difference in tickets. The same plane does not fly farther, does not fly faster, and does not land in a luxury airport for those who pay a premium. So what exactly do they pay for? 

In the software industry, given the same project specs, you can hire developers on a wide range of prices. The specs don’t change, so the end result should be the same, so why the different prices? Why is a developer more expensive than the other. And why would a customer choose to pay for someone who charges ten times the lowest price on the offer? 

A possible, but lazy answer is status. If you care that a “Google Developer” worked on your project, you will pay to be able to say that, even though a “less famous” developer may have done the job. Beyond status, this can be a marketing signal as well. When you sell this service, it may be worth it to your customers to know that a “famous” developer worked on it if that signals quality.

Trust may be a better answer. I don’t think you can trust someone “ten times more” than another person. Still, you do have a definite feeling that you can trust person A but not trust person B. 

And if trust is essential to my business, then person A can successfully charge ten times more than person B. What is the value-added to justify this increase? In the moment, probably none. But in an environment of clickbait and shady practices, person A has spent valuable time, resources, and emotional labor to prove trustworthy. Their reputation is their asset that you pay for. 

Going higher on the “better” scale, you may have to change the people you serve. If you are a high precision car mechanic, that will not matter if all your customers want from you is to fix their headlights. You may be fast at it, you may be precise, but it will not matter. You will not be able to ask ten times more for your services in that crowd. You need to find a different crowd, likely a smaller crowd, looking for that particular skill. To them, it will make sense to pay you ten times more, because the value they get out of your work is twenty times more. For them, you will still be a bargain.

On the same level with “change the people you are serving” can be “change your story.” In fact, the two go hand in hand and influence each other. If you sell a commodity, you have no choice but to join the race to the bottom. The alternative is to trade in emotions. To transform fear into belonging. For that, you need a story. You need to stand for something. To serve people at the edge, that everyone else has overlooked. 

For “regular” people, water is free. For someone stranded in the desert, water is priceless. A way to charge ten times more is to find people who are thirsty and then create the product or service that will satisfy their needs. 

Charging ten times as much is scary because it usually means you need to change and sometimes in dramatic ways. Letting go of the old clients is not easy. Letting go of the old product or service feels frightening. What if you are wrong? And we arrive at risk. Those who play it safe always find themselves in a crowded place. Setting out to sell water in the desert does not mean you will also find someone there. 

How about you? What would you change if you had to charge ten times more?