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With the economy going through a really bad stage and the rand plummeting against the dollar, euro and pound, I wonder to myself how this is going to affect web agencies and more specifically, online marketers.

Let’s face it, most companies have websites already, some being brilliant and others being simple static ones. Regardless of how the website looks, it’s there and it’s available to anyone on the internet. I sent out emails to 10 companies and individuals, whom I know, in South Africa, asking them for an idea of what they charge for the development of a website. The results were, unfortunately, very spread, from as low as R6 000 to R150 000 depending on the sort of project. Let’s assume a company wanted a blog designed, developed and customised — I would say that any company charging less than R20 000 for such a development would be crazy, unless they’re a small team and the requirements are very simple. Let’s stick to the value of R20 000 for discussion purposes.

R20 000 is a great deal of money at the moment relative to what everyone is facing with the decline in our economy. That being said, companies will be more hesitant to spend that amount on a website when they could be using that to rather drive targeted traffic to their website and work on conversion tactics. After all, the whole purpose of a website is exposure to a product and service, which is where the ROI comes into play.

In my opinion, I think the decline in the economy is going to benefit online marketers in a huge way, as companies shift their tactics from spending large amounts on new websites to rather more exposure of their websites.




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13 Responses to “Will the declining economy benefit online marketers?”

[…] this month, I wrote about the declining economy benefiting online marketers and today I read an interesting post about offline advertising dropping as online advertising […]

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What is a web site?

There is considerably more skill in designing a truly great web site than in shop-fitting a good small shop in one of our malls. Consider the ability to rate in the top 10 on google. Then there is usability, friendly interface and site map. You then have to interface this with your product database and include pictures of each product. Finally, there is the business of collecting the money and despatching the goods.

About 4 years ago, I spent a Xmas with one of Gautengs top shop fitters and one of UK’s top web designers in the travel market. The shop fitter had a staff of about 30 people and the web designer 15.

After a number of energetic discussions, I concluded that there is much more to effective web design than meets the eye. If you dont choose a good web design company, you may as well just have flush your money down the toilet.

The web designer also drew the parallel between web design and advertising. Unless you know who your market is and what they want, you will fail. You also need to have planned your marketing strategy in considerable detail before the first meeting. He regularly turned away work when prospective customers had not done their homework. (He is sufficiently successful that he can do this. A bad web site reflects poorly on his reputation).

I ask the question again; what is a web site?

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John Bond on October 21st, 2008 at 2:07 pm

Absolutely James, that must have really been a great discussion you had with your two friends.

It’s a little bit off topic, I was trying to get an opinion on whether companies would spend more money on a website or actual online marketing and the driving of traffic to the website, what do you think?

I definitely see your points and they’re extremely good ones. Hiring a great webdesign company is the best thing a company can do, turning away work is part and parcel of the operation in my opinion. A great deal of research needs to go into research for an online operation when it comes to finding the target market and not all ’shops’ are eligable for making the online transission and spending a great deal of money doing so.

Thanks James, you open some really interesting points!

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Christopher Mills on October 21st, 2008 at 2:16 pm

I can’t lay claim to the prestigious name “James Bond” as he was also part of the discussion that Xmas.

http://www.miga.org/documents/jamesbio.pdf

The photo doesn’t do this James Bond justice, he’s short, quite portly, wears glasses and is French. He has a great sense of humour though. He tells the story of meeting Gordon Brown when Brown was the UK Minister of Finance. Brown introduced himself in typical British style – “Gordon Brown!!!”, James decided to take the mickey out of him by using the traditional line with a (put on) thick French accent “Zee name is Bond… James Bond”. Later in the conference, Gordon Brown asked one of James’ associates “What is that guy’s real name…”.

Your topic was good, I was just winding it back a bit to business strategy. I find it difficult to decide what’s best without having a clear idea about the value proposition for the business, what will the business deliver to its stakeholders and what will it get in return.

Us TechnoNerds understand tactical issues extremely well, especially when related to IT but it is occasionally useful for us to step back a bit and look at the strategic picture. Our blindness to business strategy is why Nerds with IQs of 200 are managed by those pretty boys (and girls) in Armani suites, with MBA’s and much lower IQs. (we also don’t use stupid words like leverage, gearing, value-proposition and synergy)

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John Bond on October 22nd, 2008 at 9:24 am

Good question Chris

I believe the answer lies in effectively leveraging the resources in your possession to realise your business strategy. I see many companies altering their short term strategies in order to carry them through the storm we are experiencing at the moment.

So depending on their target market, strategy and arsenal it could go either way. Some will curb spending on new sites and invest in tactics to drive a higher conversion rate utilising their current assets.

Others will see this as an opportunity and devise clever ways and invest in new ventures, grab a place in the market and fly high once the curve move upwards again – I’m one of those who will use the opportunity 

@007 – I walk on the dark side, a techno nerd with a MBA

To your question what is a website I say exactly. We need to embrace a new concept … an instance and implementation of your brand which delivers an experience which resonates with a client in such a manner that they keep returning allowing you to constantly engage with them in a meaningful manner

Let me decrypt that – make it sticky, get to know them, give them what they want, let them own it, let them own the brand, make money - Sorry – I’m a capitalist bastard :-)

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Dre on October 24th, 2008 at 11:06 am

Absolutely Dre, I’m really excited to see what the beginning of 2009 brings us as I don’t see too many companies doing much this side of the new year, things are too busy.

Personally, I think 2009 is going to be a big year, although many say it’s over-rated, I agree somewhat, but not totally.

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Christopher Mills on October 25th, 2008 at 2:16 am

You probably gathered from my MBA techno-speak that I also got one together with the tee-shirt and yellow cap. It’s fascinating that ALL MBA graduates, myself included work their MBA qualification into the discussion. I am a nerd first and last. I only got my (outstanding – 4 Firsts) MBA aged 49 so I tend to be a bit disrespectful of the typical MBA graduate.

I am not sure I understand your answer. Compare websites to say printed news media, there are as many models as there are newspapers, some work better than others do but a one-size-fits-all approach is clearly unwise. For example I subscribe to a technical newspaper published in the US and if I waited the 6 weeks for it to be delivered by post, some of the news would be very stale. They also distribute their newspaper as a PDF so I often find that I have the latest electronic news before my friends in the US. In addition, there is vastly greater scope for variety and differentiation in website design than there is in the print media.

Some websites are nothing more than a business brochure and business card while others are complex trading organs, linking to multiple different databases from different service providers and suppliers. Some websites work from one server while others are spread round the globe, linked by VPNs and are mirrored on numerous proxy servers. Maybe the term website is too wide, it covers too large a range of VERY different products.

For me the answer to my question “what is a website” is complex and it depends on your business strategy.

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John Bond on October 27th, 2008 at 9:15 am

@ Dre
You probably gathered from my MBA techno-speak that I also got one together with the tee-shirt and yellow cap. It’s fascinating that ALL MBA graduates, myself included work their MBA qualification into the discussion. I am a nerd first and last. I only got my (outstanding – 4 Firsts) MBA aged 49 so I tend to be a bit disrespectful of the typical MBA graduate.

I am not sure I understand your answer. Compare websites to say printed news media, there are as many models as there are newspapers, some work better than others do but a one-size-fits-all approach is clearly unwise. For example I subscribe to a technical newspaper published in the US and if I waited the 6 weeks for it to be delivered by post, some of the news would be very stale. They also distribute their newspaper as a PDF so I often find that I have the latest electronic news before my friends in the US. In addition, there is vastly greater scope for variety and differentiation in website design than there is in the print media.

Some websites are nothing more than a business brochure and business card while others are complex trading organs, linking to multiple different databases from different service providers and suppliers. Some websites work from one server while others are spread round the globe, linked by VPNs and are mirrored on numerous proxy servers. Maybe the term website is too wide, it covers too large a range of VERY different products.

For me the answer to my question “what is a website” is complex and it depends on your business strategy.

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John Bond on October 27th, 2008 at 9:54 am

@John

I agree with you but feel the website (http://www.answers.com/topic/website) is dead. I was pointing out that we need more than just “websites” which provide you with information and the ability to transact; we need “websites” which provide an experience. Modern customers expect more so we must give them more - more information, more contact, more options, more influence in product and service design, …

If we can’t give it to them, our competitors will.

PS: I sometimes speak in META – occupational flaw

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dre on October 27th, 2008 at 11:13 am

You know that an MBA graduate can never shut up!!! – Next instalment.

I absolutely agree because I see some very interesting developments coming…

I’ve been playing with the “web page on a chip” technology. This is gaining popularity among electronic geeks and the web pages can be quite complex (depending on the flash or EEprom you have soldered onto your development board). All you need is a TCP/IP connection to the internet and good microchip programming skills, no PC, no paraphernalia. This is a full web site and you could configure it to operate say a Coke vending machine or your domestic stove. It would be capable of running a simple trading site (provided you incorporated some sort of Man Machine Interface - keyboard and screen). The chip I use is built into the standard 10/100 network plug so all you need to do is program your microcontroller. The current generation has everything except the 10/100 plug and the isolation coils. This is all built right into the microchip (yes, just 1 chip 5mm X 5mm !!!), One chip manufacturer has announced that in their next generation chip, the will even include the (quite large) coils!!!

So some websites are plunging into smaller and smaller devices…

And I’ve been watching with fascination the growth of the amazing technology used in monitoring national and international financial transactions. Most of this is behind VPNs (Virtual Private Network) so we can’t see it but it too is part of the web. These too are commercial websites…

So some websites are becoming amazingly complex, intelligent and pervasive.

And then, the Baumann/Bagley/Bright/Bond/Levisor/ family has stored their history on a very simple website that has remained unchanged since 2001, except for the huge increase in content of archived material. It now has well over five hundred users and over 20 000 files. It contains for example, photographs of Gaustaf Baumann laying the Orange Freestate Artillery guns (Boer) at Bloemfontein in 1900. It also has his diamond prospector’s license and the survey coordinates of his grave (after the Anglo-Boer war, the British frowned on Afrikaaners erecting monuments so the Boers found other ways). There is a letter to his father from President Stein and dozens of other documents. He is just one of several hundred people who’s life has been documented A more complex site would detract from the richness of this content.

And sometimes, simpler, more old fashioned is better…

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John Bond on October 27th, 2008 at 5:00 pm

I my opinion marketing might be shifting towards websites more so, but is this where the consumer is shifting?

We have an estimated 5,1 million internet users in SA. With the current economical state I don’t see that number rising as broadband isn’t getting cheaper. This makes having the internet a luxury for the general population.

So your budget might grow when it comes to online marketing but your exposure remains the same.

I predict growth to be in the mobile domain and believe that marketers will move towards this medium soon.

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The Source on November 12th, 2008 at 1:37 pm

[…] proof jobs and it’s not the first one I’ve read either. I wrote a post about the declining economy benefiting online marketers and I think it alludes to this […]

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Are you in a recession proof career? | iMod on January 7th, 2009 at 12:17 pm

— We have an estimated 5,1 million internet users in SA. With the current economical state I don’t see that number rising as broadband isn’t getting cheaper. This makes having the internet a luxury for the general population. —

Hopefully with the arrival of Neotel and the new Seacom line this should help to drive down the price of bulk data and in turn bring more people online.

In my line of business, SEO and PPC, we’ve never been busier - people are starting to understand that a website should be part of generating new business and not just a pretty brochure.

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Craig Wilson on June 1st, 2009 at 7:50 pm

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Christopher Mills is a highly experienced SEO and Web Development guru. With an impressive track record in blogging, web design, development, and web optimization, not to mention experience in hardware, operating systems, programming and networking makes him a Dalai Llama of computers.
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