Decoding the Website Design Pricing Factors of Top Design Agencies
As an Inbound Writer for Lean Labs, Melissa writes about high-converting websites and customer-centric marketing. She's an avid traveler, with trips to Iceland, Ukraine, and Portugal under her belt. She currently resides in Wilmington, North Carolina with her dog, Morrie.
Web design can be a costly and frustrating endeavor. Despite your best efforts and intentions during the process, any misalignment about budget, timeline, cost, or value can result in disaster. Given the importance of your website design, it makes sense to reach out for an agency for help. Agencies have the resources and experience necessary to see a website plan to fruition. However, selecting an agency and setting a budget can be extremely difficult.
In The HubSpot Directory alone, there are hundreds and hundreds of agencies eager to do website design work. Even when you narrow it down to a few, they all have different approaches and pricing models to evaluate. How do you make sure you get the right site and the right agency at the best price? Well, the truth is it’s hard. Top agencies aren’t cheap, and they price their web design projects to account for various priorities.
The Top Website Design Cost Factors For Agencies
Once you understand how agencies price their website design proposals, it's easier to make a plan and settle on a decision. In this article, we’ll cover the top design cost factors for agencies to provide insight on how you should approach pricing. There's a few ways agencies price out website redesigns and a few pros and cons of each.
Fixed Price Projects
With fixed-price projects, an agency will assign a value to the work upfront. That means the website comes with a set price tag that the agency assumes is correct. This approach will help you set expectations on the value you’ll receive. However, this type of pricing forces you to cover any potential waste. You will pay for things upfront the agency may or may not finish, and it limits opportunities for creativity. Since you have a set price, you cannot ask the agency to build anything they did not quote.
Another downside to this approach is that everyone will focus more on completing the project on the budget instead of achieving the objective behind the project. By the end of the build, you will have a website, but the quality of that website may be questionable.
Many people prefer this option to fixed pricing because these projects are quicker to create and there’s no strict specification to start. They’re more fluid and can adapt to change, so you can always make additional requests along the way. However, hourly rates are challenging, as they offer no guarantee of the total cost, quality, or delivery date.
With hourly pricing, your budget may explode because these projects tend to take longer to complete and leave you vulnerable. You may experience quality issues, scope issues, “developer flight,” and sometimes, complete project failure. By the end of this, you still may have a website that doesn’t perform, and once you finish the project, the relationship is over. There’s no promise or guarantee of ongoing support. Any optimization or changes in the future involve high prices and long delays.
Value billing is a twist on fixed-price billing. Agencies base value billing on what the agency thinks the work is worth to the client. You pay the agency for the value they believe they will provide your company. A lot of higher-quality agencies who know their stuff use this billing method, and you can vet their track record of delivering results by speaking with their references.
However, value billing results in significantly higher prices when you compare it to the other pricing methods. Value billing is like paying someone as if they’re a business partner, even when they’re not.
Velocity Pricing (Our Method)
We prefer velocity pricing, which means you’ll only pay us when you’re satisfied with our Growth Driven Design and website work. We get stronger referrals and build better relationships this way, and leverage our unique lean website design project approach.
We determine price by the size of the site you’re considering. You may need a smaller website up sooner, or may have a larger budget and want a more robust website with a longer timeline. Overall, the cost depends on how fast you want to do it, and how much work you want to have done.
Then, we split each objective into small, prioritized projects, making each project as lean as possible. We set a monthly “velocity,” or spend that we base on the size of your site, which can be between $2,000 and $20,000 a month and determines the pace of the project. We also set an NTE (not to exceed) cost for each project.
Once complete, we measure results, analytics, and user feedback together to identify whether the objective was hit or missed, and how to improve. The only con is that if we don’t do good enough work, you don’t pay us.
Making A Choice About Website Design Pricing
Regardless of which agency you select, you need a website that works and fits into your budget. Every pricing approach will provide a different value, so you need to prioritize what matters to you the most. If you don't mind going step by step and paying along the way, an hourly rate could work. If you need to get a site up and don't need to keep an eye on quality, fixed pricing could be the way to go. We do velocity pricing because, in our experience, that sets our team and our client up for the most success.
If you need more context about pricing and websites, we have a guide that walks you through every pricing model with additional context. With Price Wars; Fixed Price vs. Hourly vs. Value Billing, you have all of the information you need to select the model that best fits your goals and requirements.