Craig Killick
Small Business and Marketing
The changing landscape of the web design industry
Posted on 30. Sep, 2009 by Craig Killick in Web Design & Development
I’ve been involved with playing on the web since my first 9,600 modem connection back in 1995. Over the subsequent 14 years I have seen a massive shift in the way websites are created and what a client perceives as important when they spend their marketing budget.
In the early days, it was a case of anything would do and it was the realm of the programmer. Then along came design, followed closely by marketing. Now? It’s a complete messy free-for-all.
If I am honest, I still think plenty of companies are misguided about where focus their money, but that’s a different conversation.
The recent global economic situation has accelerated this change and it continues to impact a lot of web design companies, large and small, and doesn’t exclude the freelancers community in web design and web coding. Basically, it’s getting too damn easy to do at the entry level so everyone is an ‘expert’.
I have iWeb on my Mac – I could use this to create a website. There are free services online that allow you to build a web presence. I could design a website in MS Word, save it as an image and get a cheap service (found online) to create the XHTML and CSS for me for next to nothing.
Web design and coding has become productised
Add to this the fact that the recession has left many people out-of-work and setting up their own little web design businesses and the ever-growing market of micro-businesses offering web design and the hobbyists and there is only one result - a decreasing product value.
If you are a web freelancer in the UK, you may currently be chuckling that you can offer your services for (say) £30 per hour against an agency charging £80. But, you’ll soon realise three things very quickly.
- You no doubt will spend a lot of your time trying to compete for the work in the first place – you can’t charge for that time. How much is your hourly charge worth then?
- The guy like you in India, Russia, Croatia, etc. can do the same as you, but for a lot less money. In reality, they are probably a lot more hungry for the work.
- The more cost-conscious your client-base become, the more the charges decrease.
Result: Supply and Demand combined dictate a low cost product.
What actually is the product?
Part of the problem is that the client can’t differentiate it. My agency is currently competing against a print copy shop for a website project and their price point is about half the cost of ours.
Can I explain to the client about SEO, effective web design and usability so that they will pay the extra or will they just concentrate on the outlay? Time will tell in this instance.
And, what happens when the same client turns around and tells you that they can buy the design off the shelf too? It’s already happening with cheap logo sites and web design templates. SEO as well. And don’t even get me started on the noise within the DIY social media circus.
Client Chasm
What I see happening at a generalized level is a great divide. (This is a short-term view as I think that’s all that I can get away with at the rate of change.)
Larger clients (with budget) will always see the value in paying for experts who offer value. They will understand that a website is a sustainable marketing asset.
The medium-sized companies (by medium I mean £50k – £5m revenue) will move into the SME process of buying off-the-shelf solutions, cutting corners because the perceived value doesn’t compute other than as a liability on a profit and loss sheet. ie. “It costs how much?”
(A friend of mine has recently been applying for marketing positions. Some are asking for Quark and Illustrator expertise. Surely that’s design?)
As more of these medium-sized businesses look for cheaper and cheaper costs, there is going to be a great divide in the middle in terms of clients for web design agencies. The small stuff, or the big stuff. Freelancers and micro-businesses will either be competing with the very big boys, or lost in the mass of cheap suppliers and free stuff.
Don’t believe me? Ask yourself these quick questions…
- Have you ever lost a job to a client’s relative or friend?
- Have you ever been asked for a website for A LOT less than you would do it for?
- Have you seen prices falling for your services?
- Finally… take a look at MrSite or Squarespace or RapidWeaver and wonder at how they are actually ‘good enough’ solutions for a smaller business on a budget.
I’m totally agreeing with your sentiments here.
For my own personal situation though, even with 10 years of web development experience behind me, I realistically see how I could price myself, as a an individual freelancer, into the higher bracket, and still pick up work. Maybe I just need to set my sights higher.
One of the pages on my site will cover, in fine detail, some of the benefits of hiring a professional (ie. me) to do the work than an off-the-shelf product, or getting their neighbour’s nephew’s best friend to do it.
Knowing where that divide is, between the higher and low price *expectations* is something I’m still trying to discover.
Hi Craig, from my point of view (and the expensive developers won’t like this), I have found students to do me cheap websites and they have been perfectly nice and adequate. They are not websites that would win awards, but they are websites that are still good and people like them.
I have a friend who does very high end websites, charging say £10k or more for luxury brands. He has said he has to shift his prices becuase of all the graduates that will do the same thing for £500. They don’t have the epxierence, and all the things he do, but in times like a recession people do look for the best prices.
When I set up my business, I got quotes for websites ranging from £5k down to £500. There was no way I’d have risked the higher fee, and in the end I paid around £1500 for a site with a CMS. Now i look at the site and think, it could do with looking slightly slicker, and perhaps a slicker design is something I would invest in next year. But I am not sure whether it would make a difference for my customers or not.
Natasha, You last point is very pertinent – would it make a difference to my customers or not?
You could always ask them. Then at least you will know.