Here we can use an analogy from racing: “Speed costs money, how fast do you want to go?”

It should come as no surprise that you get what you pay for, and a site that your friend’s college kid did for $1000 will not be the same caliber as a website designed by a professional ad agency for a large corporate client.

In general sites that have more pages, more functionality, interaction, dynamic components, multi user access, content management system and targeted landing pages will cost more than a simple 10 page brochure website.

Company $10-$50 million:
Advertising & promotion Client annual Web site campaign budget: $50,000-$110,000
E-commerce Shopping Cart: $45,000-$80,000
Search Engine Optimization: $40,000-$100,000/yr
Splash/landing/home pages (per page): $3,000-$6,000
Banners, Buttons, Flash animations: $2,000-$3,000

Company $1-$10 million
Advertising & promotion Client annual Web site campaign budget: $30,000-$60,000
E-commerce Shopping Cart: $30,000-$60,000
Search Engine Optimization: $15,000-$50,000/yr
Splash/landing/home pages (per page): $2,000-$4,000
Banners, Buttons, Flash animations: $1,000-$3,000

Company Under $1 million
Advertising & promotion Client annual Web site campaign budget: $15,000-$35,000
E-commerce Shopping Cart: $15,000-$40,000
Search Engine Optimization: $8,000-$25,000/yr
Splash/landing/home pages pages (per page): $1,000-$3,000
Banners, Buttons, Flash animations: $500-$2,000

This is a large spread, and you must be wondering why small companies generally get websites done cheaper. The main reason is friction, cronyism and job security.

Friction: large corporations have a long sell process that involves making multiple presentations to multiple individuals and internal groups and it an take a long time to get specs to begin a job. Also there are more hurdles and regulations to getting work signed off and making sites live. I know that at Disney.com the web design process is glacialy slow, with multiple layers of bureaucracy for each change and new feature.

Job Security: Larger companies have less room to risk on smaller, unproven design firms. It is much more likely a larger corporation will select a well known agency even if they are 50% more expensive than a smaller designer, just because of the agency’s track record. Also a corporation naturally understands multiple layers of management and may feel more comfortable working with this kind of vendor.

Cronyism: It is easier to hide costs in a large company. If the person in charge of hiring a web design firm has a friend or associate who works at a big design firm like Avenue A/Razorfish you want to give them the business even if it costs your firm more, because it could pay off for this person in the future. This selection decision may not be in the best interest of the corporation, only the selection committee.

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