How Much Does A Website Cost?
To kick off, here's a question for our agency friends:
Throw your hands in the air if you have managed to accurately cost, plan, design, build and launch a website, digital product or app and haven't experienced any change in project scope or budget.
Keep them up if you also quoted a fixed price on the job.
Congratulations, you played yourself!
Figuring out how much to charge for complex digital product builds is hard. Really hard.
At NEVERBLAND we sell our time, processes and expertise in order to deliver outstanding work. This can be a tricky concept for clients to grasp, especially for first-time (often non-technical) founders that comprise 60% of our partners.
Why? Because what clients are used to buying, and are expecting to buy is a 'thing'.
A website, an app, a platform, whatever it may be; received logic dictates that you pay us X, We deliver product Y, over timeline Z.
But here's the rub: bespoke software development isn't like buying a 'thing' at all. What it actually represents is engaging with a team, following a process and working in partnership towards a shared goal.
Even with the most diligent research and planning, the sheer volume of unknowns that can and do emerge during the development process make it exceptionally difficult to guarantee what can be achieved, to what level, in what time frame and within a specific budget.
This presents an early hurdle for our fledgling partnerships. A situation in which non-technical founders with finite budgets and little or no understanding of bespoke software development are buying into an unfamiliar process for an immeasurable length of time. Yikes!
To complicate matters further, it's not unusual to have other agencies' pitches in the mix, at least one of which will be touting a fixed price and 'guaranteed' delivery dates, seducing inexperienced founders like Harpies to the rocks.
In this transitional time where agencies are split between those who have adopted an Agile workflow and those who have yet to do so, it's a surprisingly common scenario. Clients are used to comparing like with like when choosing a partner. As one quote collecting would-be-client recently mused, “I've always compared apples with apples, but you guys aren't an apple"
Correct. And furthermore my man, you're barking up the wrong fruit bowl entirely.
Closing the knowledge gap between buyer and seller involves a significant amount of ground work on the part of the agency. Naturally, a sensible portion of all our early engagements are devoted to educating our partners on best practise.
The way forward with Agile design and development
As an industry we're more or less over sequential, non-iterative design processes with reams of un-updatable documentation. Fortunately we've arrived at a wholly more flexible approach, based around Agile principles.
Agile is a framework for delivering rapid product design and development in increments. Agile allows us to structure designated teams that work together in defined roles, all of whom understand the direction of the product and all of whom value working software over comprehensive documentation.
Along with death and taxes, project scopes changing is one of life's certainties. Fortunately an Agile approach is a responsive approach, set up to react to change rather than slavishly following a rigid plan.
Agile product development is formed of a succession of sprints. We run our sprints over two week periods. You can think of a sprint as a self contained unit of work with the goal of having a working demo delivered upon its completion.
Sprint deliverables are driven by user stories (as a I want to so that I can or in real life 'As a paying customer, i want to buy some shit so that I can feel better about myself). We form our user stories together over a succession of workshops, aimed at getting to the heart of the brief, understanding our users, their problems and your business KPIs. These stories are then prioritised to form our MVP roadmap.
Having a full team engaged in a sprint is a joy to behold. Designers, Developers, Project Managers, Product Leads and partner stakeholders working together in a rapid, collaborative flow to deliver exceptional work. Ooh la la.
So where does that leave us in relation to how much a website costs?
At NEVERBLAND our engagement is based on a day rate, not a feature set. When we provide an initial estimate for a project we lean on experience honed over countless projects, products and websites. Although we can never be 100% accurate, we do our damndest to get as close as possible. However, the further we look to the future, the murkier the water of estimation.
If you were to look out onto a field and attempt to guess the distance in centimetres between two distant trees, the likelihood is that you would be a long way off. Walk closer and the chances are your estimate would improve.
The same goes for projects. In terms of accuracy of initial ballpark quotes we can say:
- 2-4 weeks (1-2 sprints): we expect to be 90% accurate as to what we can deliver
- 4-10 weeks (3-5 sprints): pretty accurate, let's say 80%
- Anything more (6-x sprints): only about 50%, however that's not to say this is a bad thing, we just need to get stuck in and our hands dirty.
When talking budgets we'll like to frame the engagement in terms of resource. A typical response reads something like “to realise your product vision for MVP you're going to need a team of 2 X Engineers, a Designer and Project Manager for a minimum of 4 sprints." It's clear and it's easy to understand. Remember, it's a commitment on team and expertise and not deliverables.
F you, pay me. Agile invoicing.
Remember the old invoicing structure— '50% upfront and 50% upon completion'?
Completion means done. But what even is 'done'?
Is Facebook 'done'? How about Netflix?
Product design is an amorphous beast.
Because we believe in charging for time spent and not fixed deliverables we take a view on team and resource requirements for up to 2 sprints ahead. At the end of every 2 week sprint we invoice. Simple! You can also monitor progress all the way in Trello and Harvest, which means at any point there is a direct link from time tracked and work delivered to invoices sent.
A note on your budgets
As a client it's important to be open with how much money you have to spend.
All projects have budgets, and if you don't know yours, it's prudent to spend some time in research to figure this out. Conversely, if you have unlimited budget, please get in touch straight away, the champagne's on ice.
If you tell us have £30k, we'll build you the best damn thing we can for £30k. If you have £100k for the initial design and development then we'll make sure you're getting the best value product you can for £100k.
Similarly, if we believe that you'll need a comfortable budget of £200k for your project then we can't do the same work for £75k— something has to give.
We're an intentionally small studio. We're judicious about the projects we take on and fiercely committed to excellence in our output. We're idealists at heart, and for better or worse, emotionally invested in the companies we help build.
We're shaping business of the future, right here in the heart of the most exciting city in the world. It's endlessly fun, and challenging and mad.
We're committed to delivering the best value for budget you'll get anywhere from a digital product studio. You ought to know, that if this were about the money, we'd be making banner ads.
So why not give us a shout and chat about how much your idea will cost ;)