How Much Does a Website Cost? Maintenance (Part 3 of 3)
At the start of this three-part series on website costs, I answered the questions of how much a website costs, and then called out migration and missing features as additional expense areas that are often overlooked.
A good framework for most people to help understand these costs is to look at buying a website like buying a house. After you've bought it you still have to move into it (website migration costs) and maintain the house over time.
Maintenance, a big hidden cost of a website, exists whether your website is new or old, although much like houses, old website are more expensive to maintain. Website maintenance costs — much like home maintenance costs — are vastly under-appreciated and generally poorly planned for. We are, after all, optimists and we hope that things will just work out with our house or website. I'm here to tell you that you're setting yourself up for failure.
The best way to look at this cost "all-in" is to borrow some planning tools from the financial world and start thinking about TCO, or total cost of ownership. To determine TCO you must decide how long you want something to last before it needs to be replaced. For a website I generally recommend a three or five-year cycle. This tends to align well with planned brand refresh initiatives, and most content management systems need to be replaced or see a major update for security reasons in that timeframe as well.
Before we start any project we will introduce our customers to the concept of a support or iteration contract. The language we include looks like this:
Projects, once completed, fall into one of four major categories:
- Baseline maintenance
- Internal product maintenance
- Consumer product maintenance
When a project is completed and no support is provided, it will fall into a state of disrepair over a period of six months to a few years. In the mobile space this happens as the project falls behind updates to the operating system and in the web as security issues or bugs surface and are not addressed. This category of support (unsupported) should only be recommended for very short-term marketing efforts or one-time-only app downloads (e.g. for events).
2. Baseline maintenance
Baseline maintenance refers to a simple contract designed to keep a software project from failing over time. This includes security patches for open-source software or minor operating system updates. It should generally be priced at 10 percent of the project total, spent on an annual basis per platform (web, iOS, Android, or Windows).
3. Internal product iteration
An internal product iteration contract is designed for products that are actively used by a small group of users, but the software faces little or no outside competition. Users expect bug fixes and minor feature development. Iteration contracts in this category include baseline maintenance, plus additional feature development. This category of iteration contract is also required for major operating system updates (iOS, Android, etc.) This should generally be priced at 30 to 50 percent of the initial contract spent on an annual basis per platform.
4. Consumer product iteration
Consumer product iteration contracts are designed for software that lives in a rapidly evolving ecosystem with a lot of competition. Users expect rapid response to bugs, regular introduction of new features — and will abandon the system in favor of something else if this doesn’t happen. As with internal product iteration contracts, security patches are included. This should generally be priced at 80 to 100 percent of the initial contract spent every year the project is supported.
The grand total
So all-in-all, when looking at the cost of a website, if you started at a budget of $30K and you'd like your investment to last for three years, you'd likely end up realistically spending $88K, or almost $30K per year. Here's how:
- $30K - Build (year 1)
- $5K - Migration (year 1)
- $6K - Maintenance at 20 percent (year 1)
- $6K - Maintenance at 20 percent (year 2)
- $6K - Maintenance at 20 percent (year 3)
- $30K - Re-build (year 3)
- $5K - Migration (year 3)
As you'll notice, the re-build and migration costs start in year 3 as you'll need the ramp-up time in that year while still maintaining the existing site. Broken down by year, the cost structure looks like this:
- Year 1: $41K
- Year 2: $6K
- Year 3: $41K
Where this leaves us
It's important to note that in the grand scheme of things, a $30K budget for a modern website is pretty modest and includes no money for any kind of marketing effort online or otherwise. You'll have the features I outlined in the first article but not much else. This is significantly more in real dollars today than websites cost even five years ago (which makes you think about long term amortization plans). There are several reasons for this:
- People expect more from a website.
- Phones and tablets require additional functionality and testing.
- Web programmers make more money then they used to (because the job is harder).
Given all of this and the rise of more user-friendly platforms, I encourage all folks responsible for relatively simple marketing sites to investigate a move to one of these platforms. Systems like Squarespace, WIX and Weebly (and many more) make the cost of building and maintaining modern marketing websites much more affordable and are worth serious exploration.