One of the biggest frustrations for both client and web designer is getting accurate pricing. In this post, I want to break down the problem and propose a solution.
How much does a website cost? It is an impossible question to answer because it depends. It is hardly surprising, therefore that questions around web design pricing are the most common ones I get from the agencies and freelancers I mentor, after questions about finding new clients.
How then can we price web design services and how is the client expected to budget for projects?
To find a solution to the challenges of budgeting and the cost of website design, we need to understand the problem.
- Most Clients Have No Idea About Web Design Pricing
- Clients Are Forced to Go Out to Tender
- Feature Lists Do Not Help Define the Cost of Website Design
- The Cost of Website Design Should Consider Quality
- Discussing Budget Is Crucial With Web Design Pricing
- Fixed Web Design Pricing is Fundamentally Flawed
First, let’s look at it from the client’s side.
Most Clients Have No Idea About Web Design Pricing
The client has to budget for the services they require and need a figure to work with. However, they probably lack any reference point.
They may have never commissioned a website redesign before. Even if they have, it could have been years ago, and the shape of the project might have been very different.
The only way they can get the figure they need for approval is to get some quotes from suppliers. Yet suppliers can easily find themselves in an impossible situation when a client goes out to tender to ask for a web design price.
Clients Are Forced to Go Out to Tender
Many clients are required to go out to tender to ensure the company gets the best value for money. However, this puts potential suppliers in an awkward position.
Often the invitations to tender lack the detail a supplier requires to provide a quote.
Also, in many cases, the client is asking for a fixed price quote, and so the supplier needs to be entirely confident in the web design price they give.
The supplier then has to make a decision. Either they cut corners and pitch the project low, or they focus on delivering to a high standard and risk losing the work to a cheaper pitch.
Even if they are not in a competitive tender situation, there is a danger with that second option that the figure quoted will be entirely beyond what the client can afford.
Now you might be thinking that if the invitation is thorough enough, listing precisely the functionality that is required, this will enable the supplier to provide an accurate quote. Unfortunately, once again, it is not that simple.
Feature Lists Do Not Help Define the Cost of Website Design
Many requests for proposals will include a list of features that the client wants to see. At face value, this should help provide a more accurate quote. However, it rarely does.
For a start, these lists of features are often more like a wish list than anything else. The client includes all of the features they might find useful, with little idea of whether those features are expensive to implement or likely to generate a return on investment.
Also, many of these features lack real research as to whether they are useful to users.
However, the biggest problem with these lists when trying to quote is that they lack the detail to be useful.
For example, a request for proposal might list ecommerce functionality. However, it is the specifics that will determine the cost of implementation.
Then there is the factor that these requests for proposal are missing the most critical element of all — quality.
The Cost of Website Design Should Consider Quality
In most cases, when it comes to creating a website, the more time you invest in its creation, the better the quality.
- More design time enables more testing, which leads to a more compelling and easy to use interface.
- More development time leaves room for optimisation and bug fixing that improve performance and device compatibility.
- More content creation time, allows space to test and refine copy to ensure it answers user questions and connects with them.
Unfortunately, acceptable quality is hard to quantify. Suppliers have trouble expressing the impact of cutting budgets on the final output, while clients do not see the return on investment that comes from a higher web design price.
That means when a client asks a web designer to quote on a project, the provider has to balance ensuring adequate quality with keeping the price in an acceptable range for the client.
Without knowing the budgetary constraints, the supplier has to make a guess. That is why it is far wiser to discuss budget upfront.
Discussing Budget Is Crucial With Web Design Pricing
Ultimately the solution to these challenges is an open and honest conversation between client and supplier about the budget.
First, the supplier needs to find a way of explaining to the client exactly why they need at least an indication of budget.
Step 1: Explain the Need To Discuss Budget
The way I have come to explain why I need to understand the budget is to compare the experience to buying a house.
If you went to see an estate agent about buying a house, the first question they will ask is your budget.
You may have other requirements, but without knowing your budget, the estate agent cannot work out the way of providing you with the best house within your limitations.
For example, if you have to have a four-bedroom house, but have a limited budget. It may be that you will have to compromise over the area, or the house’s state of repair.
In my experience, talking in these terms helps the client to understand the need to have a conversation up front.
However, it doesn’t help much if the client has no clue what their budget is.
Step 2: Establish a Ballpark Figure
Although many clients say they don’t have a budget, that is not entirely true. If you turn around and suggest that they commission a million-dollar website, the chances are they would reject the idea out of hand. In other words, they at least have a sense of how much is too much.
To help explain this point, I talk about previous projects. I give a vague outline of the kind of thing the project included and share the approximate price.
As we discuss various projects, I ask whether the budget “feels about right” and if I still am not getting anywhere, I start talking theoretically by asking questions such as:
If I submitted a proposal for $60,000 with a strong case for spending that budget, do you think it would be likely to get approval?
With a little perseverance, it should be possible to zero in on an approximate figure. That should be at least enough to outline some solutions in a proposal.
Step 3: Give the Client Options
When submitting a proposal, it is always advisable to offer multiple options.
Typically I favour offering my clients three options.
- One that provides the maximum value possible within the ballpark figure discussed.
- One that comes in over budget but offers significantly more value.
- One that falls slightly below the agreed sum, but pairs back the scope.
However, even with an open conversation about budget upfront, the challenges around pricing web services will not entirely go away.
Fixed Web Design Pricing is Fundamentally Flawed
The problems with pricing projects are deeper than we have discussed so far. It also revolves around how companies procure services, as well as handle their finances.
I have written before about how organisations need to stop seeing their website as a capital expense that goes out every few years. Instead, they need to shift to it being an operational expense that has an ongoing investment.
However, there is also the issue of fixed-price projects and competitive tenders.
The idea behind such processes is to maximise value for the client. However, I am not sure it achieves that goal.
The problem with fixed price projects is that the supplier has to pad their proposal with a contingency to ensure they still make a profit if they overrun. That means the client is paying a premium for having a fixed cost.
Many companies may indeed be happy with that. However, the more significant problem is that fixed-price projects also mean a fixed scope. That leaves little room for ideation based on user feedback or pivoting if the direction proves wrong. Instead, a fixed price project locks both client and supplier into a course of events that could lead them in entirely the wrong direction for the business.
I believe it is time for companies to start engaging suppliers on a time and material basis, or at the very least, breaking big web projects into smaller fixed-price projects that allow the opportunity to adapt between engagements.