Why you need a website budget
We’ve recently had 2 frustrating encounters with public sector tenders for website projects. Both projects were well within our capability in terms of technicalities and scope. But of course, being public sector projects, sat between us (and no doubt several other agencies vying for the work) and the project was a procurement process. There’s lots that can be said about the flaws in procurement processes, but let’s save that for another day.
The common factor in both of these tenders was the lack of a specified budget. Before this sounds like a rant, we don’t consider budget to be everything in a project. However, when we work to make a living, pay our employees and other costs, it has to be a consideration, particularly when deciding to commit our own 'free' time into researching and pitching for a project.
We asked for details of the budgets allocated for these projects, and both responses were almost identical. As if they had been woven into some procurement bible by someone well removed from the buying process.
‘It has been decided, that in the interest of achieving the best value for our organisation, the budgets will not be disclosed’
So let’s talk about money
We all have to cut our cloth, whether we’re spending our own money, or someone else’s. It gives us constraints and sets a challenge, but it still needs to be realistic.
If I’m looking to buy a house, the first question I’ll be asked is ‘how much would you like to spend?’. And with sound reason. There’s no point me looking at a million-pound lake fronted mansion when I know my budget can only realistically afford a terraced house. It would be a waste of my time and the estate agents. The process happens if you’re buying a car or booking a holiday. It’s a question we’re generally comfortable with and one we can usually answer.
So why would people who’ve most likely faced similar questions themselves feel by disclosing a budget for a website they won’t get value?
What’s value then?
Like many things in life, our feelings towards something can be measured against our expectations. Whether something is expensive depends on our expectations, but more importantly, the value we get from it.
There are 2 ways to look at ‘value’ in this context.
- What is this project, or its outcomes worth to you or your organisation?
- What are you getting for your budget in terms of time or deliverables?
Question 1 is easier to define. If I expect sales or brand value of £500k from a website, then I’ll perhaps look at setting a budget that is a proportionate to the return. A £20k investment (or 4%) in the website and related marketing would show pretty good value, but could be unrealistic depending on how you want to achieve it. I’m less concerned about the deliverables in a project here, so long as I get my return.
What you get for your money however can be harder to evaluate, especially if you don’t know what you’re buying, which is often the case with people buying a website. It’s not something easily measurable. Website projects are almost always bespoke as well, so making a direct comparison against a ‘bottom line’ figure will rarely be a fair comparison. Plus, if you don’t know what you don’t know, how do you know what you expect as part of a project?
So where is the value?
Achieving value for money is not a case of looking at 2 flat figures and saying one is better value over another. Value is most definitely not a financial amount, but what is delivered for amount that has been agreed.
Value takes into account how you feel about working with someone, their expertise, the process you’re guided through, the things you don’t get from someone else. If you get all of this, then the value will speak for itself. Value though is not the budget.
How do you set a budget?
Most people fear that if they mention a budget, it will automatically be spent. And actually, is there anything wrong with that? If you’ve budgeted for this amount, surely you were expecting, or at least prepared to spend it?
A web project should start with a budget. Then instead of asking for a quote, ask what can I get for my budget. This sets the most important constraint up front and makes planning ‘what’s in’ and ‘what’s out’ much easier.
Over the coming weeks we’re going to add a series of blog posts on things you should be considering when planning a website project. This will of course be based on where we feel we add value, but it should help you to look out for certain things you should expect to be included, helping you to define what a realistic budget should be.
The moral of the story
It’s ironic that one of the tenders we submitted a proposal for was later withdrawn. Why? Because all the submitted quotes were over budget and the issuing organisations procurement limit. So in the interest of preserving value for money, the exercise turned out to be a waste of time delivering no value for anyone. The value of providing a budget speaks for itself.