Understanding The ROI on Your Website

Kaila Thomas
3 min readJun 17, 2021

It’s pretty much a given that in 2021 and beyond you need a website to grow your business.

But you may be concerned about how well the investment will pay off. Let’s be clear DIYing your site will always cost less upfront than paying someone (a freelancer to a large agency) which can range from $1000 to $100,000. But investing in a professional to redesign or create a new website can and should eventually pay for itself.

Photo by Sincerely Media on Unsplash

FACTORS THAT COME INTO PLAY WHEN DETERMINING YOUR RETURN ON INVESTMENT

  • Cost of building the website
  • Cost of maintaining the website
  • Traffic to the website — how many visitors are coming to your website
  • The conversion rate — how many of those visitors click a call to action to book service or make a purchase
  • Website lifespan — the time before its next refresh or overhaul. 2 years and 7 months is the average length of time.

THESE ARE THE FACTORS THAT CAN AFFECT YOUR ROI

  • Poor Functionality
  • Bad Design
  • Poor Content

WAYS TO IMPROVE YOUR ROI

  • Increase the number of new visitors — directly related to your marketing efforts
  • Minimize your bounce rate (the number of people who leave your site after visiting one page) — make sure site navigation is easy to use and user friendly
  • Enhance your website's usability — again focus on making sure the website is easy to use

HOW TO CALCULATE ROI (WITH AN EXAMPLE)

First, determine the yearly cost:

Design, development, and maintenance: $6300

Lifespan: 3 years

$6300/3= $2100 per year

Next estimate your website’s lead generation impact

You average about 300 visitors per month or 4000 per year

3% of your visitors turn to inquiries which is 120 leads per year

20% of your lead turn to customers which is 24 customers per year

Now determine the value of each customer

Let’s say the value of each customer is $600

$600 x 24 =$14,400 (annual revenue generated from website)

Finally, calculate the ROI

(increase in revenue — annual website cost )/ annual website cost = ROI

SO LET’S PUT THIS FORMULA TO WORK

Currently, your website gets 24 customers per year with each valued at $600 and your annual website cost is $2100. With a new website, you anticipate increased visitors and higher conversions

  • 10% more leads

15,840 — $2100/$2100 = 654% ROI

  • 20% more leads

17,280 — $2100/ $2100 = 722% ROI

And there you have it, your website ROI. I’ll be honest and say I’m no mathematician but an ROI of 100% or more is certainly a worthwhile investment. If you have a website already, use the built-in analytics dashboard or better yet Google Analytics to see what your visitor and conversion rates are and plug that data into these formulas.

Once you’ve got a good picture of where you are and where you want to go, it’s time to take decisive action and make the investment. Wondering where what factors could be affecting your website ROI? Let’s talk about it. Schedule a free chat now.

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Kaila Thomas

I’m a Brand + Web Designer helping #mompreneurs elevate their brand through thoughtful design so they feel confident growing their businesses.