Why does building a good website cost so much money?

I often in passing conversation talk about the websites and projects i've been involved in quoting for, and i 9 times out of 10 get stopped dead in my tracks when i mention one thing, cost. No one ever stops me when i talk about the ground breaking research i've been involved in, the industry leading user centred designs that organisations i've worked for have created, no, the cost.

So let's break this down. Let's start from the top.

How much does a website actually cost?

First off, there is no "fixed" price. It's the same as ordering a VW Polo, compared to a Ferrari 458 Speciale. It's no different to ringing a building agency to build you a house. You could want 2 bedrooms, you could want 50. Ultimately, it depends on the client, what they want, and what the target audience wants. You may be always ordering a car, but depending on if you order a Polo or a 458, the cost will vary, but the end result the same - a car that you drive.

However, a bulk stock 2015 Polo GTi, in Australia, costs anywhere from 31k - 35k+, depending on the options, and aftercare you go for, so let's work on the common sense principle of; ranges.

Some assumptions to set the base level.

  • It's in Drupal
  • You have an existing and established brand
  • We do design
  • We aren't hosting, but have root access and control DNS

A basic website, minimal-to-zero research, few designs, decent interaction, only a few different types of pages; $40,000 excl GST (VAT for English folk). That, at $165 an hour (about average for a mid-to-large web agency) is 242 hours, about 30 days of effort which is 6 weeks.

A more advanced website, with good research, going out to the public and asking their opinion, testing, validation, good designs, some really good functionality; $120,000 excl GST. That, at $165 an hour is 727 hours, about 90 days, or 18 weeks (4 months).

Those two, are about the average websites i see across my desk, from minimum to maximum every day average. I have however seen a proposal for a large university that would completely transform their online presence. You can just imagine the complexities involved with 50,000+ students that can enrol on thousands of different courses at different levels. I saw this quote go out for $1,200,000. Yes, One million dollars. I won't do the hours effort math for you, there's no point, it's a lot.

How can you possibly be allowed to charge that much for a web page?

It's simple, honestly. Physics. I know physics is far from simple, but bear with me.

I mention the hours in those quotes for one simple reason, the amount of effort involved (which translates into hours) per task very quickly adds up to these amounts. If we get asked for a simple 5 page website, contact form, some nice homepage features, different business locations, different users and permissions, really nice design and weekly update meetings, you would be very surprised how quickly you get to 40k and beyond.

How can a website take 30 days of effort to build?

I'm going to break this down into a Tender, and a Proposal.

A tender is a document where organisations put an idea out into the public, basically there request for how they want their product to work.

A proposal is our answer to that. How we solve their problems, how our business works, how we'd work well together, why we really want the job, and of course, the price.

The Tender

As a business that sells real estate advice
I want an appealing and SEO friendly website
Where i can advertise our services, list our locations with a map and opening hours, showcase our latest projects, show prices and an efficient way for people to contact us
So that i can be listed top 6 on google for "Perth real estate help", and my enquiries increase from 3 a week average, to 8 a week average across the year

Pretty simple. Sorry for anyone keen on agile, i know i butchered the user story principle but it worked well for what i'm trying to get across in the simplest form.

The proposal

* based on an 8 hour day, 165 ex GST per hour cost.

Although i've spoken mostly about hours in terms of effort, it's hard to understand cumulative effort based on hours, so this table is based on days. 

Items Description Effort in days Cost ($ AUD)
Project kickoff & initiation Prepare documentation for kick-off, hold meeting with client with team, and write up results. 

* one meeting that takes one hour with client, 3 people, is going to cost you 3 hours. Don't forget this.

1 1,320
Design      
6 responsive designs Designs for 6 different templates (home, content, product, search, contact, 404) which are also responsive. Includes 1 iteration. 10 13,200
Development      
Setup Drupal Install and configure Drupal on local. Setup staging environments and hosting. 1 1,320
Setup content types and fields   2 2,640
Setup additional functionality Such as contact form, custom 404 page, product pages and views associated with bringing that functionality 2 2,640
Theming Time is spent throughout the project, usually towards the end on a Drupal project 5 6,600
Testing Should be on every project, regardless of scope (usually 20% of total development) 4 5,280
Documentation & Training      
User manual Creating a simple user manual 2 2,640
Training Usually with up to 5 people for a standard session, usually 2-3 hours and with 2 agency employees, which equates to a whole day of billable time with travel 1 1,320
Launch      
Make website live A developer is normally available for the entire launch day. Also takes time to prepare the server, swap DNS, etc 1 1,320
Project management      
Oversight of project All this takes communication with client, time to meet, talk, email, discuss with team 3 3,960
       
Total   32

42,240

Without even trying i've hit 32 days. You might be able to shave a few days of design if you go really, really basic, but while the days by themselves seem pretty straight forward, add them all together and you've got a $40,000 hole in your pocket, and a website that is what the business wants, with no care in the world for what the users may want, or any concept of what may make the business any money or some of that $40,000 investment back.

How can a website possibly take 90 days of effort to build?

I'm not going to go into details, hopefully you've grasped the concept from the 30 days, but i want to explain how you make the jump from 40k, all the way to 120k and at the end of the day, still get a URL in Google.

When you move into this kind of website design space, a space where your website project can take 6 months and on, it's key to understand you aren't just paying for a web page anymore. You are paying for a design that makes sense to your users, you are paying for functionality that works and takes all eventualities into account, you are paying for a product that will give you measurable results.

Bedroom developers i'm sure are very capable of creating great looking websites - but is it great looking to the people that are actually going to use it? This goes back to an article i wrote about how websites should be built for the users, not the people paying for it.

Talk specifics, what does 90 days get me that 30 doesn't?

First up, the most important - is user research. An agency worth anything will make sure the online presence they create is what the users want. This can be achieved by initial research into your users, their trends and how your business is making impact within its industry. From there, you build on its short falls and validate. Take wireframes to interactive wireframes and go out to a chosen segment of your audience. Once you've gone through some iterations, preparing, wireframes, research, user interviews and processing the results, you've already got 10 days of the research stage out of the way.

Now you've got wireframes that you know will make a difference, you can start designing. The best technique i've found that actually works (if you are good enough to explain to a client that these aren't designs) is to use something called Style Tiles. This creates a picture of what elements could look like. It's really good to create 3 different levels of tiles and get the client to pick from them to create their perfect site. A boring style, a mild style, and a blow their face of tile. Once you've gone through this, we've got another 5 days gone.

Once the client has picked their tiles, you have a design direction you can start putting crayon to paper. It may seem obvious but it's an iterative process and takes time, a lot of time can get absorbed in this phase. Any designer worth their crayons will design something, dislike it and start again. It takes getting it wrong to get it right. Style tiles remove a lot of this risk but the risk will always exist. Your average website has 10 different templates. Honestly, 10, count them! If we say initial concept for a homepage and a content page will take 5 days, and designs after that about a day each once you average out between complicated design, and a search result page, you're basically at your 'cheap' 30 days, and you've barely got a design, and don't have any piece of a website, let alone a functioning one.

I won't go on because hopefully you get the picture, but after that you have the technical part, because the developer has been involved throughout the design process to validate the plausibility of the design - right? At which point, you make shit happen!

Then of course you have documentation, a smooth launch, validation. If the technical phase takes 40 days, documentation and launch another 5, the total thus far is already 75 and just like that you only have 15 days in the bank! Don't forget you need a project manager to sustain communications, book meetings, update the client every few days, which is usually where that 15 days goes.

See, easily spend 90 without even thinking!

Don't be scared to spend good money with a good agency to get good results!

A good agency will question your end game. A good agency will validate it's delivery to you. A good agency however, is a business at the end of the day as well. They have bills to pay and talented individuals to make your website awesome who also need paying.

Don't be afraid to spend the money if you understand what returns you are after, and don't be afraid to ask for advice. Hell, ask my advice.

Don't be worried if the cost is high, it's a lot of the time justified - not always, but most of the time. It's easy to tell by us, we can tell agency inflation when we see it.

Don't be insulted if an agency tells you that your budget is not enough

They are being honest, and they have to look after their best interests as well. They've got bills to pay and a roof to keep over their heads. Sure, don't get taken for an idiot, but if you want all the bells and whistles that a decent website can give, don't be surprised when it cost's you some gold plated arms and billet aluminium legs.