Is Your Website an Expense or Investment?

When you run a business, you spend money on a lot of things. You can view your spending on something as an expense or as an investment. Which one do you see your website as? Let's consider whether a website is an expense or an investment, and why.

Expense Versus Investment

What's the difference between an expense and an investment? An expense is a simple cost; you trade your money for something your business needs. But with an investment, you intend to earn back more than you spend

Think of an investment in the stock market. You wouldn't buy shares of a stock unless you expected it to increase in value, so that some day you'll end up with more money than you originally invested.

There are things that you can buy for your business that earn you a return on investment (ROI). For each dollar you spend on those things, you expect to get more than a dollar in return.

Website: Expense or Investment?

Would you call your website an expense or an investment? A poorly-executed website will be a simple cost, but a well-executed website will be an investment that earns you more than you put into it. How?

Your website generates revenue for your business, directly or indirectly. You may sell products or services directly on your site and collect payment directly through it, or you may market your products and services on your site and collect payment when your customers come to you after visiting your site.

When you sell directly, traffic (website visitors) turns into sales, earning you money.

When you sell indirectly, traffic (website visitors) turns into leads (prospects), which turn into sales, earning you money.

The Investment Perspective

You need to consider what you spend on your website (and other aspects of digital marketing, such as SEO and Google Ads), and compare that to your customer lifetime value (CLV): the dollar amount you expect to earn over the life of your business relationship with a customer. How many new customers would digital marketing bring in? How much additional revenue each month would that represent?

If you had the option of spending $1,000 per month on digital marketing to earn $1,500, $2,000, $3,000 or more each month, would you take that deal?

This is why it's short-sighted to choose the lowest-cost website and digital marketing you can find. With digital marketing, you usually get what you pay for.

If you spend a small amount, you'll likely get a low-quality website and meager (if any) digital marketing, making it unlikely that you'll see a return on your investment.

However, if you make a larger investment to get a high-quality website supported by solid digital marketing, you greatly increase your chances of achieving a higher ROI.

Which option sounds better to you?

Are you ready to invest in your website and digital marketing, to start earning a return on your investment? Contact us today!

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