The Hidden Costs of a Bad Website
Author: Peter Schnoor | Reading time: 9 minutes
Costs & Benefits
First, let me briefly explain what I mean by costs. Initially, one might think of the money specifically paid for an acquisition - in our case, the amount paid for the creation and operation of a website. It becomes more difficult with costs that are not directly quantifiable, such as the time spent on changing content. Additionally, costs can arise indirectly through a website, for example, legal fees incurred due to using an unlicensed image. The hardest costs to recognise are those that arise from a lack of revenue. These hurt the least in the short term, as often one doesn't even realise what they're missing. But this type of cost is all the more insidious, as they are often noticed too late, potentially putting entire companies in jeopardy.
However - and I must also mention this: a website does not have to be expensive to avoid costly follow-up expenses. But you must know where you can save - and where you cannot. Otherwise, you are proverbially saving at the wrong end.
Fewer Customers
Those who haven't experienced it don't know what they're missing. Here, a slightly adapted story of one of our clients:
Imagine you are a tradesperson, and new, qualified enquiries for your services come in daily through your website. Specific enquiries like: "We are currently renovating our holiday home and still need a .... . We are available for a site visit at any time. Please send us a specific offer. Sincerely, Mr. Müller". And now imagine you are in the same industry and have a website, but no enquiries come in. Would you miss something? Maybe not. Maybe you are still busy at the moment.
But what will happen when tradesperson 1 and tradesperson 2 are in direct competition in the same region? Tradesperson 1 regularly gets new enquiries, could possibly even hire more employees and grow. Or raise prices. In any case, they would have the opportunity to build a reputation through good service, which in turn, even through word-of-mouth recommendations, leads to new orders. And that holds true, even if they couldn't take on every job due to capacity reasons. Tradesperson 2, on the other hand, will eventually wonder why customers are gradually disappearing. They might not immediately think of their website as part of the problem, as they don't know what it's like to have a successful website. But they will feel that the wind is getting harsher.
Building a customer base is a lengthy process. And it costs a lot to accelerate this process when you're already in the ditch. Let's take a closer look at two specific costs that can result from this:
Expensive Marketing
One way to compensate for a poorly performing website is to invest more in other marketing channels:
- The website ranks poorly on Google? Let's use AdWords!
- Recognition in the region is shrinking? Let's advertise in the newspaper!
- We don't reach our target audience? Let's advertise on Instagram!
Particularly expensive is this form of marketing with a poor website. Because if the website doesn't meet users' expectations, they will leave quickly. A high percentage of the marketing budget in other channels can be wasted effectively if users, brought to the website through expensive advertising measures, quickly leave due to a poor user experience.
This is a vicious circle. You would be amazed at how rarely entrepreneurs are aware of this vicious circle - and how much money is spent on practically pointless campaigns.
Loss of Trust
Another cost factor, rarely immediately noticed, is this: A bad website can also lead to a loss of trust among visitors. Trust is a crucial factor in online business, and if a company's website doesn't seem trustworthy, potential customers will hesitate to make purchases or enter their personal data. An unprofessional website that doesn't meet current security standards or whose design and content are outdated can raise doubts about the company's credibility.
The loss of trust can have several consequences:
- the company attracts the wrong customers (e.g., a clientele books at a hotel who don't fit in there and therefore constantly cause friction)
- the company is forced to sell its products or services at a lower value to achieve any sales at all
- the company finds it harder to impress potential lenders
- the company loses its "standing" in the local business world
- the company receives less trust and credibility during bad PR
This all means not only lower revenues but can also damage the brand's value in the long term. Customers who have had bad experiences with a website are less likely to return or recommend the company.
Fewer Applicants
A point I already mentioned in a previous blog article: We live in a candidate's market. Companies must increasingly strive to attract enough capable applicants. Here, a bad website can have devastating consequences.
For many applicants, a company's website is the first point of contact to learn about the company and its culture. If the website is outdated, unprofessional, or difficult to navigate, it can give the impression that the company is not modern and progressive.
An inadequate careers page that is not clearly structured or lacks important information will deter qualified applicants. This makes it harder to recruit talent and can lead to a long-term shortage of qualified personnel. And these are costs that are not immediately visible.
Adjustment & Expansion Costs
While the previous cost points are rather indirect or hidden, it is obvious here: If costs arise to later adjust the functionality or appearance of the website, then these costs are higher the worse the website was developed in the first place.
We often receive requests from companies that had a website made "very cheaply" by someone at some point and now need adjustments for this website. That can't be so hard, can it? Unfortunately, it often is. Because not every website is built as modular and flexible as a Lego set, which can simply be expanded and adjusted as desired. Sometimes websites are more like a Playmobil set. This is not meant as a criticism against Playmobil, but it is significantly harder to convert a car into a flying car with Playmobil than it is with Lego.
If the website is not designed for scalability and flexibility from the start, future adjustments and expansions can be costly. This is especially true for companies that are growing and want to expand their online presence. Additional features such as e-commerce modules, user logins, or integrations with other systems can require significant investments if the existing website is not prepared for it.
Often, even small changes to a website become so expensive that it is almost cheaper to start from scratch. And this is unfortunately not an exaggeration. How much could website owners save if they paid attention to a few important points in advance! But unfortunately, this often doesn't happen because it needs to be quick and cheap. These additional costs that arise later could be avoided if the website were professionally and future-proofed from the start.
Legal Issues (GDPR Warnings, Cease-and-Desist Orders, Competition Lawsuits)
A point that increasingly causes costs, which could actually be avoided, is everything related to legal matters. Especially since the introduction of the General Data Protection Regulation (GDPR), companies are required to comply with strict data protection regulations. A website that does not meet these requirements can quickly lead to legal problems. Warnings, cease-and-desist orders, and even lawsuits can be the result.
A common problem is an inadequate privacy policy or the lack of consent mechanisms for cookies and other tracking tools. Such violations can lead to high fines and often require the help of lawyers, which incurs additional costs. Additionally, competition violations, such as misleading advertising or unfair business practices on the website, can lead to expensive legal disputes. Or the use of images that have not been licensed.
Costs Due to Security Issues
A final cost factor I would like to mention here, which is obvious to many, is the costs that arise when a website installation is insecure. A poorly secured website is vulnerable to cyber attacks such as hacking, phishing, or malware infections. Such attacks can not only cripple the website but also lead to data losses and thefts. Restoring the website and lost data can incur significant costs.
In addition, a security incident can massively undermine customer trust and lead to long-term revenue losses. In some cases, companies may also be legally obliged to inform affected customers and take measures to prevent future incidents, resulting in additional costs.
Conclusion
The hidden costs of a poor website are diverse and can have significant implications for a company's success. From fewer customers and applicants to higher marketing expenses and legal and security-related issues - the consequences of an inadequate website can be far-reaching and costly. Therefore, companies should invest in a professional and user-friendly website to avoid these hidden costs and be successful in the long term. A good website is not just a cost factor but an investment in the future of the company.
Because if you buy cheap, you buy twice.
Start Off Right
Need help with your website? We are happy to advise you and help you avoid unnecessary costs from the outset.
contact@netjutant.com (+49) 8685-30998-22