What does it cost to own a website? What recurring charges does my company need to budget for when we set up our website?
If you or your company are going about creating/revising your site, you will want to be armed with the facts and be prepared for the numbers. Your website will be an invaluable tool and business asset, and you know it is worth spending the money on the extra features that your customers will appreciate. But how about a year after the project is completed, and your design studio is asking for another check?
Even after the site is built and launched there will be recurring fees, the most basic of which is simply keeping the site “live” and online every day.
Basic ‘Cost of Doing Business Online’ Services
There are two regular charges that every site will incur, which are domain name and web hosting.
Your company’s domain name is the custom URL that your visitors will use to reach your site, e.g., sprisemedia.com. You can also make use of your domain to create professional email addresses such as “email@example.com” – this instead of using a freebie service like Hotmail or Gmail.
Necessary? A human-readable domain name that describes your business is essential.
Cost: Low, less than $30 per year, billed annually.
This service is about giving your website files a 24/7 internet connection and a fast computer that can hand them out to all your users at a moment’s notice. This is a time of great choices for a hosting customer, it is a very competitive industry and the industry standard uptime is 99.99% for even the most basic accounts. Your host can provide you with email account tools, statistical data, FTP access (for transferring large files), and other perks at no extra charge.
Your website will be stored on professionally-maintained servers in a climate-controlled building, being backed up in the event of an emergency. While it is not impossible to host your own site on your own server, the low cost and stability of professional web hosting makes it the better choice for most sites.
Necessary: Completely necessary 24 hours a day, 7 days a week.
Cost: Less than $15 a month for small-medium sites. Larger sites may need more resources, on the order of $65 or so per month. The very largest of sites (e.g., Amazon) require considerably more resources.
When Your Web Hosting Obligations Will Increase
Expect to need more computer-power if your website:
- Makes use of software that requires a lot of computer resources to run. This could be highly functional software that performs many tasks per second, or it could also be a smaller but inefficiently designed system that is wasting resources.
- Will be growing constantly due to user participation or increased user base. At the larger end of the scale would be the social networks, who create virtually no content themselves but give each user the ability to upload photos, content, video, etc. Each account adds another little slice to the hosting needs of the site.
- Streams video or audio frequently. Today we have the ability for great video quality and instant playback, our computer downloading the video while we watch it. Video files are large however, and sometimes a hundred or more MB (megabytes) get passed from host to user as one person watches your content. Don’t shy away from video for this reason – the benefit far outshines the cost.
- Is a really high-traffic place on the web. Why is the Craiglist.com design so boring? The answer is that the simple text-based design is highly efficient, which is very appropriate considering that 99% of Craigslist is free to all. They are able to keep expenses low by delivering some of the leanest pages out there, and support their site by charging a few dollars for job advertising only.
If you’re selling online and taking credit cards, you’ll have a bank account set up for that purpose (merchant account) and will also need to have a payment gateway service.
The merchant account is the type of bank account needed to accept payment by credit or debit card (checks and cash also accepted, of course). You’ll want to get the merchant account first, because it will dictate what payment gateway services you’ll be able to choose from.
The payment gateway is the quick, Accepted-Or-Denied piece of the selling puzzle. It takes the place of the regular credit card terminal to make the “virtual swipe of the card”. Your payment gateway should be chosen from the list allowed by your bank (to work with their accounts), and most allow you to process a credit card by hand if you’d like (for an offline transaction).
Cost: Varies but typically a monthly fee (often $30 or less) for the merchant bank account, plus a per-transaction fee of about $.30, and usually another percentage fee on the sale (1-3%).
The Bottom Line on Website Charges
To keep your site online and accessible, figure on twenty or so dollars per month in basic services used (domain name and hosting). If you know you’ll have lots of video, or an ever-expanding amount of content (such as from constant new users) then bring your budget up towards $65 per month. If you aren’t sure you fit the higher-needs category, start small and see how it goes. Do your pages load quickly and completely? Are you within your allotted share of server resources? If so, you’re fine at that service level.
When adding ecommerce to your site make sure your business model can support not only the standard credit card processing fees (around 3%), but also the added cost of the credit-/debit-accepting bank account (the merchant account) and the per-transaction “swipe fee”. You’d incur the same costs in a brick-and-mortar business, so just don’t forget about those expenses when planning your retail site (no out of site, out of mind).
Here’s to happy and profitable site ownership!