Creating, Measuring and Maintaining Website Value (Page 2 of 3)

Maximizing Value - Calculating ROI (Return on Investment)

Calculating Website Value is difficult for everyone involved. There are several types of Websites with different goals and functions to achieve those targeted goals. Sites are created with many specific goals in mind.

Calculating ROI on B2C (Business to Consumer) Sites, selling consumer products is fairly straight forward; Cost vs Profit from Sales. ROI realization and calculation become more arcane for B2B (Business to Business) Sites offering indirect sales. Let's take a company offering engineered products and services for an example:

For simplicity's sake we are going to limit our discussion to a hypothetical company named "Great Widgets Inc.". They want to develop www.greatwidgets.com and provide good value in the process. (note: at the time of creating this example this company name and URL did not exist)

The primary goals of the Great Widgets Site are:

1. Generation of Qualified Sales Leads
2. Information Provision
3. Branding and Brand Recognition

Unfortunately all 3 involve some intangibles. Therefore, some tangible value has to be ascribed and quantified for each.

Great Widgets Website Scenario:

Great Widgets has spent approximately $10,000USD over 18 months with a contractor to develop a 100 page website promoting engineered products for multiple industries. The Site addresses the needs of about 6 industries directly with pages targeted toward each. The Site also has printer friendly downloadable brochures linked to each product page. The company receives 2-3 inquiries per day on the products offered directly from their website.

Generation of Qualified Sales Leads

Currently, the Great Widgets Website is generating an average 2-3 inquiries/day, 10-15/week, 520-760/year. Let's immediately dismiss 1/3 and use the minimum figure of 520/year.
It has been said that "a personal visit sales call costs $400, a phone sales call costs $40 and an internet sales call costs $.04".
With that in mind let's pick up the 520 minimum, potential customers taking the initiative to contact Great Widgets yearly and ascribe a $50 value to each. $520x$50=$26,000/year

Sure this is a "quick and dirty" method, but it is an easy way to show minimum value quickly. On the other hand real value could be tracked and measured at a greater cost.

Information Provision

The Great Widgets website has grown from around 50 pages initially to around 100 currently. Content depth is well provided, organized and easy to find. Higher end employee's time fielding phone calls has been reduced. Potential Customers are being pre-educated on products and take less time to handle. Customers are able to pull down maintenance and operation manuals, installation guides and dimensions, performance charts and more. The Sales and Marketing group are using the readily available online digital data to refer inquiries, reduce e-mail time and size and not have to answer as many questions. The entire Sales and Marking Staff time required per sale has been reduced and streamlined.

Looking at the numbers: Minimally figuring this increase in productivity, it is fair to ascribe an ongoing and increasing tangible value of 3hrs/day minimum savings for Great Widgets key employees.

With that in mind let's pick up the numbers again and estimate a minimum value for the Information provided by the Great Widgets Website: 3hrs/day x $50/hr x 5days/wk x 52weeks = $39,000

The fact that both active and potential customers access the website to review and download product information has tangible value.

More on Website Value, ROI, Branding and Marketing on Page 3.