Can my small business afford a website? This is a question that we get asked all the time, and the short answer is yes. The long answer takes some explanation. Let’s explore some of the costs of advertising a business.
You have to advertise to get your business name out there, but advertisement isn’t always billboards. Most small businesses don’t have the resources to place those ads. Let’s examine a phone book advertisement. All of these figures are dependent on content, placement and other various factors; they are not quotes for advertisement. For a basic ad on their website your business can expect to pay around $100 per month or $1,200 per year. Your average ad in the actual book can run up to $8,000+ per year. Ouch. So, keeping score, we’re up to $9,000 worth of advertising. It’s going to be hard to recoup that level of investment.
Next, we’ll consider using social networking as the sole source of advertisement and the opportunity cost involved in that. Facebook is free. Hallelujah! Not so fast. Facebook does nothing on its own. You have to spend the time to fill in all the information, make all the friends, gather all the “likes” and keep the content up to date; preferably on a daily basis. Otherwise, it’s just another page floating out there that no one reads. So, let’s assume you have put in the time to create and maintain a Facebook page for your business. It probably took you a few hours to fill in all the information, put up some pictures, send out some recommendations, etc. Now, every day you need to spend a couple of hours updating your posts, keeping the information relevant, making sure you’re reaching your target audience, getting more and more “likes” and maintaining two way communication with your fans. Here’s the big question: what is your time worth? Even at minimum wage ($7.25 per hour) for 12 hours per week you have spent $87 worth of productivity on Facebook alone. Now, I’m sure you value yourself higher than minimum wage, but for the sake of argument we just spent $4000 per year in productivity.
Now let’s take a look at email marketing. One site charges about $15 per month for up to 500 email addresses. Not a bad deal, but you still have to do the work. So let’s assume that you’ve paid for the 500 addresses at $15 per month. You want to send out bi-weekly emails, so you spend about 3 hours (at $7.25/hour) working up the emails. So your opportunity cost is $21.75 every two weeks plus your $15 per month for the addresses. That totals about $750 per year if you are severely undervaluing your own time.
Before you know it, you could have spent nearly $15,000 and had almost no return on that investment. But there is good news! Web sites can cost a fraction of that investment. Plus, websites are 24/7 advertising. They work around the clock. Granted, you still have to put in some time to make sure the website information gets out there, but we can make that easier on you as well. We can also help to make social networking easier. If you’re going to put in the time, shouldn’t it give you multiple results? A website, combined with facebook and various other points of contact allows you to realize a much larger return on your investment of time and money.
So, when considering your advertising budget, consider that outdated forms of advertising are very expensive, relying on facebook isn’t as free as it seems and email marketing can still add up to thousands of dollars. Consider the big picture for your small business, and take into account what your time is worth. Add up the real costs before you spend anything, and remember Cobalt Spider Web Design can help. Just give us a call.