Understanding When It Is Time To Build A New Website

Note:  In last week’s post, I said I’d write about using Google Analytics to determine your best demographics for Display Targeting, but I found myself with a lot of time on an airplane without internet, so I wrote this instead.  The GA demographics post will come next week.

We started out as an exclusively Pay-Per-Click management company.  However, as I discussed briefly in a previous post, good PPC, SEO, CRO or social media strategies can only bring traffic to your site: the site then needs to be able to sell your product.  We work with a lot of small businesses and we understand that budgets can be tight.  I’ve had terrified clients call me because they couldn’t pay their AdWords bill, let alone afford increasingly expensive website redesigns.  Yet sometimes biting the bullet and ponying up for a new website is the best course of action.

Does your website look anything like this? If so, a website redesign will probably pay for itself in increased conversion rate quite quickly

Does your website look anything like this? If so, a website redesign will probably pay for itself in increased conversion rate quickly

 

The most important outcome of a website redesign is an increase in conversion rate.  It should be considered an investment in your business, just like AdWords: you invest x dollars and you get y dollars in new sales.  However, unlike with Pay-Per-Click spend, the value of that increased conversion rate applies to all of your traffic sources.  It doesn’t stop paying off the moment you pause your AdWords account.  If you need sales or a direct response right now, advertising is the way to go.  If you want to invest in the long term health of your website and have some stockpiled resources, a redesign or SEO initiative is a better way to spend that money.

Consider an advertiser who spends $4000/month in Pay-Per-Click advertising and gets 4000 clicks.  This advertiser’s conversion rate on those PPC clicks is 10%, so 400 of those visitors convert.  If each conversion is worth $30 profit, the advertiser makes $8k total profit from their AdWords spend each month *($12k revenue – $4k in Adwords spend= $8k).  Not bad!  However, if that conversion rate were increased by 50%, that advertiser instead makes $14k profit each month ($18k revenue -$4k AdWords spend=$14k).  All but the most expensive website redesigns quickly pay for themselves under this scenario, not to mention how much more advertising you could do with the increased margins!

for the purposes of this exercise, we’ll only worry about direct response conversions and leave the lifetime value of a repeat client out of this

Now consider the opposite scenario: the same advertiser sees his conversion rate decrease from 10% to 5%. The net profit after advertising costs is now only $2k ($6k revenue – $4k AdWords spend).  Conversion rates won’t drop by 50% overnight, but businesses with outdated websites will almost certainly see a decrease.  Why would consumers buy from your old, stale, difficult-to-use site when a competitor offers a superior experience?   At some point, visitors will start hitting “back” enough that your conversion rate will drop to an unprofitable level.   We’ve had clients who refused to redesign their website for a fraction of what they paid in AdWords each month, all despite data that screamed, “All you need is a good new website!”  There weren’t less buyers in the market: they were just started going elsewhere to buy!

If you aren’t sure if your business needs a new site, here are a few tips that might help you determine it:  

Approach Your Website With Fresh Eyes

Oftentimes, we become so accustomed to our website that we start to assume it can’t be improved.  On the contrary, the best practices back when you first built your website (2009? 2005?) are likely to be outdated.  Those who aren’t consistently innovating will fall behind those who are: just assuming that you got it right the first time is probably leaving money on the table.  Give your website an objective walk-through or sit down with someone who has never seen it and see what they think.  Is the desired end goal of the site (online purchase, lead generation, etc.) easy to determine?  Is it easy to get to that end goal?  Is the site’s layout and content fresh and engaging?  Does the website have responsive design, ie. does it conform to the size of the user’s screen?  This is increasingly important in today’s mobile world.  Sometimes it’s best to honestly reflect on something often taken for granted.

Compare Your Site With Your Competitors

Is your website matching up with the competition?

Is your website matching up with the competition?

Travel into enemy territory and give your competitor’s website the same objective walk-through.  If the majority of your competitors’ websites are providing visitors with a better experience then yours, that’s a good indication your website is behind the times and you should consider an upgrade.

Consult Google Analytics

If you are fortunate enough to have had Google Analytics installed on your website for a couple of years and have useful conversion tracking configured, you can look at your website-wide conversion rate season-over-season or year-over-year and know definitively whether your conversion rate is on the downswing.  Just make sure you take other factors into account that could effect conversion rate, like seasonality or changes in the industry!

An advertiser with GA who has seen a significant decrease in conversion rate in the last year

An advertiser with GA who has seen a significant decrease in conversion rate in the last year

 

Hopefully I’ve made clear the importance of an up-to-date website and how to determine where yours currently falls on the spectrum.  If you are worried that you might need an upgrade, don’t hesitate: think of the conversions you’ll fail to claim if your traffic volume is writing checks your website can’t cash!

 

 

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