A Return on Your Web Site Investment?

-- by Mitch Arnold, Preferred Partners, LLC

Almost all business decisions ultimately boil down to one thing: money. How much is this going to cost me, and how much can I expect to earn in return? Return on investment or ROI is usually at the top of the list of factors a business considers when it is considering a new expenditure, such as a Web site or Web site enhancement.

In most cases, it's less expensive for a business to invest in a Web site than it would be to avoid a Web site altogether. How could that be, you might possibly ask. How can a business spend more by deciding not to publish a Web site or worse yet, publishing a Web site that reflects poorly on their company's commitment to quality? Simple, the cost of acquiring new customers and retaining current customers - a necessary expense for almost every business - is higher without a Web site than it is with one that functions appropriately.

A new business must focus efforts on attracting new customers and then retaining those customers, while some more established businesses can reverse that focus and spend more effort retaining existing customers while making themselves open to new business. In either scenario, costs are involved.

Brochures, print advertisements and phonebook ads are all common forms of marketing, from the smallest to the largest of businesses. Each of these forms of marketing costs more than a traditional Web site, and it's rare that any of them outperforms a well-designed and used Web site.

A business should target their print advertising, and most do, advertising in trade publications appropriate to their industry and placing their yellow pages ads in strategic areas. By putting themselves in the right position, they stand a better chance of attracting the potential customers that they want, but that's all it is - a chance.

Print advertising is passive marketing. In the case of print advertising in newspapers and other publications, you are hoping that a prospect will notice your ad while they are doing something else. In the yellow pages, you hope that they choose to call you, instead of your competitors, who are likely listed in the same section as you.

Brochures and other self-distributed publications, such as catalogues, can be targeted more easily than print advertising to reach the right prospective customers. However, it takes considerable effort and often, considerable cost, to make sure that they get in the right hands.

Unlike print advertisements, which are limited in their reach by their subscription lists or market reach, the audience for a business Web site is limited only by the number of prospective customers with Internet access. While it is true that having a Web site doesn't guarantee that the right customers will find you, with the correct search engine optimization, you can make yourself stand out from not only your local competition, but also from competitors around the world.

Another advantage enjoyed by companies with Web sites is a virtually unlimited amount of space to make your case with prospects. Rather than condensing everything you do and everything you sell into a tri-fold brochure or a 2-inch by 3-inch ad, your Web site can expound on the features that set your company apart from the competition. Plus, you can make simple changes easily and inexpensively, especially when compared to reprinting and redesigning print advertising.

Let's get back to price. After all, cost is an important component of return on investment. A nice, basic, yet attractive promotional Web site will require an investment of about $600 to develop. (see this link for more information on Web costs.) Monthly Web hosting costs, including e-mail, are approximately $25. Thus, first year costs average $70 per month. After the first year, the monthly cost will be limited to the $25 hosting charge - less than most businesses spend on their telephone and probably even postage in a given month.

Contrast that with other forms of advertising. Designing and print 1000 brochures will cost at least $1000. Send them out one-by-one through the mail, and you're adding $.39 each to the cost. Make a simple change requiring a reprint, and you've doubled your costs.

Most advertising sales people will laugh at you if you tell them that you want to spend $25 to $70 per month advertising with them. If you don't believe me, call up a radio station, newspaper, magazine or telephone book publishing company. You can make it even more interesting if you ask them to design a strategy that will bring you one new customer per month within this budget.

Now, I say all of this believing that almost all advertising brings value to the advertiser. Have Preferred Partners, LLC design a nice brochure for you, or maybe a logo and newspaper advertisement. We'll increase the effectiveness of those publications with a well-designed Web site, but don't attempt them without a Web site. A Web site is mostly likely the best way to maximize the ROI of your marketing budget.