Is Website Design (as a business) Ultimately Doomed?

[Ainslie X11]

Why do I feel that this industry is so undervalued

The markets never been undervalued, but if your at the end of the market competing for low value work, then you've got no show of competing with every second person with a computer and paintshop pro, and not just those from third world economies.

High value client's identify designers they want to work with by portfolio, word of mouth, and/or reputation. There usually isn't a sum they won't pay for 'arguably' showcase quality productions and designers who are 'arguably' the best in the business.

High value clients, number in the millions, and the numbers increase everyday. So those designers are very busy people, they make a lot of money - they have a lot of talent.

There may come a time when the curve evens out, leading to more competition at the higher end of the market... I doubt anytime soon.

But isn't it the same with all trades? The best plumbers cost more, even a nicer Pizza can cost double that of one less tasty - gosh, even flying first class costs more than business class, and in economy class - we'll, there's plenty to choose from there and which would you pick if the difference was 5 bucks? does the "who" really matter?

But if you've travelled first class, it doesn't take long to figure out who "deserves" your business. You get picky about who you'll fly with, better cheese boards, bigger LCD panels, nicer selection of wines - and do you bother to even look at economy class?

Airlines try and think like their first class passengers, it gives them a show at understanding what it takes to get and retain their business

[XLCowBoy]

Personally, I moved away from design as a career and into online marketing a number of years ago, largely for this very reason. It's very difficult for small business at the lower end of the market to compete against these one man band type set-ups who are happy to knock out cheap, quickly put-together web sites for next to nothing. It's important to remember though, that despite all this, there are design agencies who make obscene amounts of money, charging upwards of seven figure sums for a complete design and development packages.

How do they do this? I can only speculate, but I suspect it's because they made the conscious decision to move out of the now saturated 'budget' market space long before it became the amateurish farce it now seems to be. I also suspect that there's plenty of room up there, if you're cunning enough to make the move.

At the moment, you seem to be coming up against the type of client who focuses only upon up front costs rather than potential results. It's a well known fact that one must speculate to accumulate, however in my experience these types of business often lack the resources or foresight to speculate, then simply failing to accumulate as a result. This is a very basic marketing error, but also a very common one.

Dealing with much larger organisations, day in, day out for the last few years it has become very apparent that such business deal only with the tangible. Facts, figures - NUMBERS! Every proposal, every strategy must be backed up with solid, realistic and ultimately accurate ROI projections. 'ROI' rules the roost. Quite simply - large organisations pay substantial fees to larger, more reputable marketing / design agencies for one very simple reason. Because they get more $ back.

Here's an example:

- Agency 'A' wish to charge $1,000 for a web site / marketing campaign / whatever. For every $1 you spend, you'll get $1.20 back. This will make you a total of $200 profit.

- Agency 'B' wish to charge $50,000. However, for every $1 you spend, you'll get $5.00 back. In this case, you make a profit of $200,000.

Assuming you are a large organisation with a large budget, which option would you choose? The 'cheap' one, or the 'expensive' one? The figures here are only an example, but you catch my drift. If you are to catch the bigger clients, this is a great way to secure the business you need to make your company a success.

Design, on the surface is a very subjective matter and hard to put directly into monetary figures. But it can be done. When pitching, get as much information as possible from your prospect - in particular, traffic volumes, average sale values (or 'lead' value if it's not an e-commerce site) and conversion rate. If you cannot get this information, make a realistic estimation based on any industry information you can find through research.

As an example, a prospect comes to you with the following information:

- 10,000 monthly visitors
- Conversion rate is 2.5%
- Average sale value is $200

From this we can understand that they make the following:

10,000 visitors converting @ 2.5% = 250 sales / month
250 sales x $200 (average sale value) = $50,000

Then you come along and make a comprehensive review of the site. Highlight all of the issues that your review shows up and explain for instance, that in your experience (backed up with case studies once possible) with all of these issues that a conversion rate of 5% can be expected. In this case, with just a marginal increase in conversion rate, 250 sales / month become 500, and $50,000 in sales becomes $100,000.

Then expain that at your rate for a redesign of $50,000 they will have made their money back within the first month. Again, these figures are just examples but they should give you an idea of how to educate against the 'cheap is best' mindset whilst also helping you acquire the BIG clients that will get you that villa in the Bahamas, or the Yacht, or whatever else you want to buy with your new found wealth.

Apologies for the essay - I hope this helped and best of luck with your business.

And this, explains exactly why we're moving towards the creative agency industry. We have everything that's needed. Personally, I'm glad to be leaving "joe-plumber" behind.

In a nutshell, I guess a good analogy would be:

If build a Hyundai, it won't be as good as a ford, hence you attract buyers who can afford a hyundai.

If you build a Ford, it'll be better than a hyundai, and you will lose your hyundai clients, but you'll gain some ford ones.

Now if you build a BMW, or a Merc, or an Audi... why in the world are you trying to attract the Hyundai market? They'll never afford you even if they wanted to - so why not make better use of your time targeting those who CAN afford your product.

Now, the only issue left is proving to the client (and yourself), what quality level your product is.

[jamestflynn]

I love that analogy:

If build a Hyundai, it won't be as good as a ford, hence you attract buyers who can afford a hyundai.

If you build a Ford, it'll be better than a hyundai, and you will lose your hyundai clients, but you'll gain some ford ones.

Now if you build a BMW, or a Merc, or an Audi... why in the world are you trying to attract the Hyundai market? They'll never afford you even if they wanted to - so why not make better use of your time targeting those who CAN afford your product.

I agree with a lot of other peoples opinion here that the market is changing and becoming more competitive. But in my personal opinion I do not really look at it as a bad thing.

Five years ago people did not see the value in a web site or really understand how it could help there business. Now even J. Smith Plumber understands and is aware that by having a web site it will enhance there business and is looked at more as a necessity then an expense. So yeah the competition is greater because everyone wants to ride the wave of companies wanting to get started online. But the way I see it is if you have been around awhile and can prove your worth now that companies understand and really look as a website as a viable way to increase there profits as opposed to another expense then if you present it properly they will not have a problem paying the rates.

Now on the other side of it if you were to focus or single out a niche in a particular area then only increases your odds. But that is not specific to the web that's ALL businesses. So that is not a very valid comparison.

I think people are looking at a website not as a two page flyer online anymore but they are looking at it as part of there integrated marketing and if you can do that then that is what they want.

[PHPCamp.com]

I agree with Jonny and Slayerment which is why I went into marketing instead of just building sites. A web site is just a marketing tool. For those who understand that statement it becomes clear why just building web sites is like being good at building engines instead of building cars. A web site is a means to an end and the better you can help clients reach that end the more you'll make.

Most people (1) have no clue about what their real business is, what their target market should be and how to reach them and (2) I did know markets and could make way more money marketing for myself and those close to me with a good idea.

Then I came across Dan Kennedy. For those who know him you know what he can do to get you to focus on marketing instead of just the tools of marketing. He deals in the numbers. If it's profitable do it. If it remains profitable...keep doing it.

imo, I believe that only offering site design is a shrinking component of the bigger marketing picture. The whole industry may be growing which takes design along for the ride but the bigger income is offering a way to get your clients to their goal which is why I'm very picky on who I take on as clients. They have to prove to me they know the numbers and the numbers are sweet. If their only goal is to have a web site I send them to the fish. GL

[dinheiro]

Now that you have more time on your hands, why don't you build a real website with some solid content. Once the site starts to grow, throw some ads on it, that way you will have a residual income and not have to worry about losing customers to some punks overseas. Just give it some time. The chickens will come home to roost. I had a client go to the Phillipines and another to China, after two months, where did they end up? Back doing stuff with me, why, becasue I charge them high and my work is good. Don't start underbidding becasue Muhammed can do a whole website for a cup of tea and a triscuit. Don't hate... There are still plenty of companies that have a no offshore policy, stop digging around websites like craigslist to find them. I send my resume and portfolio to everybody. Even if they aren't looking for someone. I usually land 3-4 contracts a month just doing that. Try that out.... Also, I am looking for some solid partners if anyone is looking for work, send me your best rates.

-Din

[bwdow]

Rule about not talking about price has removed a few days ago. You can talk whatever you want

[Mitochondrion]

One of the reasons why doctors and lawyers are so successful, respected and well-paid is because their positions in the society and the job market are cemented and fortified by certifying bodies or boards. A board is an elitist professional organization that won't talk to the candidate until he or she completes very long and very expensive education. I understand it takes something like 15 years beyond college to train a neurosurgeon or a cardiac surgeon. Once such a highly trained and certified professional completes her educational and certifying requirements she will not have her job taken by an 18 year old. In contrast, web designers are often 45 year old men whose job security is in jeopardy because of some 18 year old who lives with his mom and is using pirated software.

Perhaps the answer is establishing certifying bodies for website designers. The bodies will set the educational and practice standards so high only the best candidates will stick around to complete their education and certification. With the open nature of business on the web most people will blast me for the idea and I personally doubt it is a feasible approach. In fact, many of the senior Sitepoint experts have begun their web careers as 18 year olds living with their parents and using stolen software...

[savagepriest]

I agree with your words I have dedicated 2 years in learning HTML then css and photoshop and now I am learning flash still I dont say I am an expert web designer.
There should be some certification as we have in networking like ccna to prove our expertise

[Scott.Botkins]

If you improve your skills then you will seperate yourself from the others who open up frontpage and build the basic website.

[emkay]

One of the reasons why doctors and lawyers are so successful, respected and well-paid is because their positions in the society and the job market are cemented and fortified by certifying bodies or boards. A board is an elitist professional organization that won't talk to the candidate until he or she completes very long and very expensive education. I understand it takes something like 15 years beyond college to train a neurosurgeon or a cardiac surgeon. Once such a highly trained and certified professional completes her educational and certifying requirements she will not have her job taken by an 18 year old. In contrast, web designers are often 45 year old men whose job security is in jeopardy because of some 18 year old who lives with his mom and is using pirated software.

Perhaps the answer is establishing certifying bodies for website designers. The bodies will set the educational and practice standards so high only the best candidates will stick around to complete their education and certification. With the open nature of business on the web most people will blast me for the idea and I personally doubt it is a feasible approach. In fact, many of the senior Sitepoint experts have begun their web careers as 18 year olds living with their parents and using stolen software...

Both occupations are by far incomparable. You're comparing a profession that has to do with the welfare and health and safety of humans against multimedia and design in the biggest media resource in the world? It only requires a few second of thought to realise WHY medics and surgeons need to be so well trained. Serving a client or coding a website may have its certain risks, but they are absolutely nothing when compared to surgical and medical tasks.

Nobody's going to die to fall fatally ill at the sign of a terribly designed website. Web design is a creative industry, and not regulated by any means, and should not be, at that. Seriously, what problem is there with 18 years just wanting to become successful will the limited resources they have? Instead you should be crediting their commitment and interest

[RogueOnTheNet]

I've got to the point where I have no desire really to take on any web design projects anymore. In fact, I just turned one simple and small site down because I know they won't pay what I'll ask to do it.

I'm working on sites for myself now and putting what I have learned over the past decade to work for me. There are those who will simply never pay what you're worth; the best thing to do is quickly qualify your prospects as any good sales person should.

I have created some lengthy and detailed proposals detailing ROI and various critical factors that any client would be interested in knowing, outlining marketing strategies...going the extra mile in hopes of landing clients, and pitched them to prospects who could afford them and still been told "no," because it simply happens now and then. However, I have learned two really important things about clients and money.

1. I ask them what they need, what they want, and what their budget is first thing. Their answer to those three things will tell me if there is any point in putting in time on a proposal or whether I should just give them one of the following answers: "I think you need to go back to your business/marketing plan and reassess/reconsider," "That's not the sort of project I prefer to take on, however, let me suggest ___________" or "That will run in the neighborhood of $__________," and say "Thanks for speaking with me, though."

People who are clueless about what they need and want are not good prospects for me unless they have some unique vision are willing to pay whatever it takes to make it happen.

2. I am happier to pass up paying gigs that would have provided needed cash for the peace of mind that comes from not devaluing my labor. It is easier to do that if you don't depend on just one particular source of income. If someone 'just wants a 4 or 5 page site with nothing fancy for $500' I point them to someone else or a site where they can find someone who will be glad to do that. Makes me useful. However, I'm not even going to fire up Programmers Notepad or email your webhost unless the prospect of a couple grand is there. And in the meantime, I'm going to charge you $25-75 an hour for my initial consultation to write those emails and do the research you don't want to (depending on the stated size of their budget).

Hey, a degree isn't cheap and neither am I. Qualify or disqualify, be bold and you'll sort the grain from the chaff quite readily. I'll do some networking and teching to keep money rolling and take the projects on where someone wants a CMS, has a marketing plan, needs someone to train workers on software or wants a media plan drawn up. No point in taking on a job where I might spend 8 hours thinking up a good design or trying to help a client articulate an idea they're not even sure of when it's part of some piddly project pricing structure that means I'm going to end up working for $4 hr when you figure in the total time setting up webhosting accounts, emailing, creating documents, FTPing, writing code, creating backups, and so forth.

I would rather not have that money and spend those 8 hours reading a novel or spending the day hiking or playing guitar. My time is worth more than that to me...could care less what it is worth to anyone else. So, am I going to take on clients that aren't willing to pay what I feel I'm worth?

Not no, but hell no. There are people paying $20-25 an hour for guys to spend 10 hours mowing, weed-eating and raking their yard...something I did as a kid for $20 in about 4 hours and a better job of it to boot. Unless someone intends to just use cookie-cutter code and templates and throw a generic logo on a site and not bother with research and other things to create a small site, there's no point in it--from my point of view. I would rather stick RAM in PCs or rid them of viruses, or throw together small networks for a quick buck. At least that way you make an honest dollar and don't have to worry about writing proposals and working for free hoping to land a client.

Which is all why I'm building sites for myself these days.

The last two sites I pitched were in the $7k-$11k range and I'm not the least bit concerned with sites that aren't worth at least $2-3k. Sure, there are other designers and developers or agencies who won't touch something that isn't worth $50k and good for them. Everyone has to set their limits and parameters.

Even when it comes to networking, I used to be willing to create a proposal for prospective clients. Now, I tell them "What sort of network are you building, what hardware will you be using? Once I know that, I can tell you what it will cost for me to put it together for you and get it up and running." If they say they don't know what hardware they need, and network topology sounds like something aliens might use to survive...I tell them I'm glad to do the research and throw together a proposal--but it will cost them an hourly consulting fee to do so. That way, if they don't like my bid, I did not waste my time and I get paid for what I did.

They don't want to pay for honest work, they called the wrong guy. I'm not a charity, I expect to get paid.

[XLCowBoy]

Can somebody ban/clear up the last 3 spamposts (sposts?)

@RogueOnTheNet: I share your thoughts and feelings. I remember some chap who wanted me to design a slew of illustrator icons, a unique site, logo, and marketing materials for $500. I told him how much it was really going to cost him, and he snapped back saying I was too expensive and he could get the work done elsewhere.

As you stated, the simple fact remains: there are clients that are willing to pay your value, and there are those that do not. When you get rid of the latter, you will be much happier overall.

[adesignrsa]

The problem is; finding those that will pay what it's worth.

Rogue, I am at the same stage as you at present. The problem is that I am getting so little work now as it seems as if 98% of inquiries are wastes of time. Hence my concentration and effort in my own sites and photography business. Which are doing well.

Circuitchaser.com is a combination of my passion for motorsport and love for photography.

Fromthecamera.com is to market my photography offering.

I'm using my skills to benefit myself. If people aren't willing to pay me to do websites properly, I'll do them properly for myself and benefit on my own

[israelisassi]

I work closely with many professional photographers and hear the same concerns, frustrations, and arguments. I think this is true for pretty much every industry out there.

[SpacePhoenix]

With the global credit crunch, the cost of a project will probably be a bigger issue for clients in any industry.

[impunjabians]

i agree, with adesignrsa

fault is not of new commers, institution leavers, and un-housed wives. every one is thinking to generate more and more work but what about Quality Assurance and Architectural aspect.

Uneducated folks are now in. but they don't know about web 2.0. i can name a few. usually they don't have market study and knowledge.

college projects can't give you what you need to sit and sustain in market. any budgeting activities.

[adesignrsa]

Well, I just had a meeting with a company wanting a website to showcase well over 3,000 products. They want the site to be a product catalogue, with no pricing shown, and an advanced search filtering.

They are completely oblivious to most aspects of developing a site and just wanted a "quote". No hosting has been established and the meeting was with the receptionist/does-everything lady.

Did I mention they don't want to spend anything on marketing. Nothing... not a cent. Not even when I told them how many websites go online every hour! Nope, they'll send emails out to their 5,000 (unsolicited) recipients... with Outlook.

After hearing that, I politely declined.

[ccRicers]

I agree with Jonny and Slayerment which is why I went into marketing instead of just building sites. A web site is just a marketing tool. For those who understand that statement it becomes clear why just building web sites is like being good at building engines instead of building cars. A web site is a means to an end and the better you can help clients reach that end the more you'll make.

Most people (1) have no clue about what their real business is, what their target market should be and how to reach them and (2) I did know markets and could make way more money marketing for myself and those close to me with a good idea.

Here is something that I've realized for a while. Web design, in the education context, is mostly placed within art programs. Marketing is an undervalued aspect in art, especially if you're taking the independent route of becoming a self-made artist. They have to sell themselves. They need a well-rounded set of skills. It's not enough to have a killer portfolio and a talent to design these days. Whether you're selling paintings or website designs, you are a business already. Most don't know how to act like one, which reinforces the "starving artist" idea.

[magicman6452]

We've taken clients from nothing to number one on Google for very relevant search terms and they're now conducting millions in revenue attributed to their sites.

Big Deal, but you can determine where Google will rank pages.

[adesignrsa]

@magicman6452: Your post makes no sense? I don't understand.

[Mitochondrion]

Both occupations are by far incomparable. You're comparing a profession that has to do with the welfare and health and safety of humans against multimedia and design in the biggest media resource in the world? It only requires a few second of thought to realise WHY medics and surgeons need to be so well trained. Serving a client or coding a website may have its certain risks, but they are absolutely nothing when compared to surgical and medical tasks.

Nobody's going to die to fall fatally ill at the sign of a terribly designed website. Web design is a creative industry, and not regulated by any means, and should not be, at that. Seriously, what problem is there with 18 years just wanting to become successful will the limited resources they have? Instead you should be crediting their commitment and interest

Aha...OK...forget medicine. Try to get into any of the unionized working class industries such as electricians or plumbers...it will be the same thing. In other words, good luck. When an electricians union holds entrance exams only like 5 percent of the top scores will be admitted. I stand by my statements. Ever seen that commercial that blasts ordinary job search sites like Monster? It shows a tennis championship game where the entire audience suddenly jumps into the court and starts chasing the ball. Many of the invaders don't even have tennis rackets but use suitcases and frying pans. The champion tennis player is overrun by the crowd and he's just standing there in a daze. It's a great allegory of what is happening in professional web design. Any idiot can jump into the middle of your tennis game and go after your ball. There are no rules that keep the amateurs in the spectators' seats.

[Taler]

The first post is truely sickening to hear from the viewpoint of the consumer. Web design (thank god) is one of the few actually competitive industries we have currently, not dominated by a few big companies that pull in all the bucks. Barriers to entry are low, and it's easy to get started in the lower value segments, as it should be.

If you want some commie industry protection then you should go back to the soviet union and give putin a blowjob.

If you learned anything in college it should be that competitive industries theoretically have economic ZERO profit margins. That's right, nothing. Unless you bring something new to the table, you will be able to barely make it worth your while. This is unless you show that you are above the crowd and is able to do something better than mediocrity. If you're actually good enough of a web designer to do a significantly better job than the mom and pop, you will get noticed and will be able to get better prices. Otherwise get out of the industry because you will never going to be able to make money.

The industry isn't undervalued, you're overvalued. Get real.

PS: Your profolio is terrible. Learn to use borders, learn to direct eyeflow, stop relying on gradients, if there really was a professional association of designers you probably wouldn't be able to get in.

[jonabyte]

I have begun looking for retainer type clients that pay a flat fee per month to keep me updating or creating new sites. I personally think this is the way to go.

I agree it is too hard to compete with everyone who has a computer and a copy of frontpage (lol).