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Are you giving your website the credit it deserves? (Part 1)

The same old story … an underperforming website … a desire to make the site more effective and a small budget.

First question: What is meant by "more effective"? We have learnt that most clients tend to focus on just a fraction of their website’s value.

If you are struggling to justify your website’s effectiveness and haven’t yet identified and quantified your website’s value in dollars, it’s maybe time you did.

Value comes in two flavours: additional revenue and reduced costs.

We typically look at two types of value behaviours: direct and indirect.

Concentrating on the direct ones:

Sales. How much revenue does the site generate through direct sales? Try looking at your gross online margin. How does it compare to offline sales?

Next, estimate the lifetime value of new customers finding you via the Internet. Maybe they began their relationship your business with a small purchase, but understanding and quantifying what that may lead to is a key exercise.

Leads. Generating leads, not sales, may be your site's primary goal. Rather than just look at the raw number of leads, try to quantify their value, too. Solid offline tracking can show you close rates as well as average sales values of the online leads. If your site generates an average 100 leads per month and 20 of them end up in sales averaging $500 each, a website’s lead value can be calculated at $100: (average leads closed divided by total leads x average revenue per sale = lead value)

Be sure to give credit for that.

Customer service. Your website can be an effective way to service customers at a much lower cost than offline options. If you want to calculate the impact of your website on overall customer service costs, firstly, you have to know your baseline costs. For example average per-call call centre costs, can range from $3.50 to well over $10, where as answering an email can cost $1.50 to $3.50 or more. The cost of a site-based service transaction is usually well under $1.

So do the maths and understand the volume of each correspondence type and the related cost. Then you can determine the efficiencies of your website. For example:

Call centre: 1,000 calls x $5.00 per call = $5,000

E-mail: 500 email messages x $3.00 per email = $1,500

Web: 800 help visits x $0.30 per visit = $240

Total support costs: $6,740

Average cost per touch: $2.93 (total costs divided by total support touches)

These are examples of direct values that are fairly easy to quantify for many sites. They are also quick exercises to provide the ammunition you may need to justify your website‘s effectiveness.

Don't forget that equally important are indirect value measurements, such as your website’s value as a research/reference tool, as a promotional and awareness tool, enhancing customer satisfaction, and much more.

You should, of course, consider all the different ways your website impacts on your bottom line, but a good place to start is to calculate that impact in hard cash.

Website statistics cost just $5.00 + GST per month and offer an extensive range of valuable information about your website's performance, who is visiting, what countries do your visitors come from, what pages are most popular, what sites are referring to yours etc. etc. No other form of advertising offers this type of insight into your potential customers/clients. Are you paying for links to your website from other sites, if so your stats can show you exactly how many visitors are coming from those sites. Contact us to arrange to start receiving statistics now!

Leanne Taylor
:: www.wwwdesign.co.nz ::
Award Winning Website Design, Hosting & Maintenance
Phone/Fax (09) 817 9656 ~ Mobile (0274) 701990

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