A Guide: Real Cost of Setting Up An Online Site

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Investing in an online business isn’t as costly as a brick and mortar store. However, for business owners on a shoestring budget, it’s imperative to plan out a realistic budget when setting up an online store. Read this comprehensive guide to get an idea how much you’d have to invest on a site and what other expenses you need to consider for a smoother, more efficient business online.

Most people, particularly those who are toying with the idea of establishing an online business instead of the more traditional brick-and-mortar business, automatically assumes that setting an online store is dirt cheap. Just a few hundred dollars and you got your very own online site with all the bells and whistles, right?


While you can get a basic website for free, customization is where the money is. And that’s just the beginning!A complex site, particularly those equipped with shopping cart feature, cost anywhere between $5,000 to $15,000! And with various components changing from time to time, the general figure is hard to calculate. In this post, we will go down the nitty-gritty and find out how to plan a budget for your site, what important expenses you need to consider to enhance its online performance and what other factors to take note of when calculating the cost of marketing your business online.

Hand Coded or Off-The-Shelf Web Design Package?

One of the first things to consider when setting up a website is to whether to work with a web design firm or to purchase an off the shelf web design package. Hiring a web design firm to handle the coding of your site is an excellent choice because it allows for complete optimization and your design team can base their design according to your own specifications. However, this is ideal only if you are ready to shell out a lot of cash for a customized design.

The fact is, customized sites cost as much as $15,000 and expenses could climb up if you include SEO, hosting, general website maintenance, etc. to the package. Although the cost of web design has gone down considerably, the need for interactivity has helped hold the price of premium web design at high prices. One of the most common reasons for the higher rates include the clamor for mobile-optimized sites, as more and more people demand mobile and tablet support from website owners.

Off the shelf web design is a great alternative to customized web design. You can purchase these ready-made web designs from leading web design firms and set up is fairly easy. Off the shelf web design appeals to most business owners, especially those who are venturing into the online business industry for the first time, because it’s cheaper and the diversity in design and quality is very extensive, giving people more options in terms of how they want their sites to look and what functionalities to consider.

The general rule of thumb is, if budget allows for it, then hand-coded sites make an attractive choice for unique and striking website. On the other hand, if you are saving your money on other pertinent expenses, then an off the shelf web design package should suit your business just as well.

Domain Name

No website is complete without a domain name. Yes, you can run a business without a domain name or perhaps, with no website, but there is simply no substitute. It’s not advisable to start an online business without a domain name! Sites that don’t have their own domain name will always be at the mercy of their web host’s domain name. If the web host came across problems or it closes down completely, your site, which you invested time and money on, will be gone in seconds.

Your domain name is a necessity for the health and longevity of your website and its price should always be a part of your budget when developing a website. Domain name rates will vary from registrar to registrar but the ballpark price is around $9 to $10.

Web Hosting Service

Commercial web hosting services offers an annually fee subscribers will pay in order to keep their sites accessible online. The payment terms will vary from service provider to service provider but others allow discounts if you pay a year in advance. Others offer monthly payments for sites with minimal traffic or data. Gradual increase in traffic and in data files means site owners have to upgrade their service plans in order to accommodate bigger files.

If you plan to establish a simple, personal website or a hobby site then you don’t need to purchase a costly hosting plan. In fact, you can get free web hosting services. You to set up a site and send an application form for free hosting and in exchange, they could either place adverts on your site or provide limited services.

When it comes to paid web hosting, it’s important to check for service providers that provide reliable services. Some web hosts have frequent “down” times and during these times, websites under their service will be temporary inaccessible online. If your website is down for a considerable time, you stand to lose profits and customers.

In terms of rates, web hosting services will range from $13 to $15 for basic sites and $90 to $200 for high traffic, high data sites. When it comes to selecting a hosting service, it pays to do your homework! Always compare rates, list down likely service providers and know more about the quality of their services before committing to one.

Additionally, cheap doesn’t necessarily mean the more cost-effective option. Some service providers might offer hosting at bargain prices but the service is unstable! Consequently, higher prices doesn’t necessarily equate to better service, which is why it pays to scour forums or customer testimonials from credible sources to see which service provider offer dependable service at great prices.


Another factor to consider when deciding your budget for a website is the software you want installed for the website being set up. For instance, blog sites can be set up using free software. You don’t need to spend a lot to create your own website, as you can get free software from online sources; you just have to know where to look. On the other hand, for those who want websites that can be managed directly from a web browser without using a web editor, you’ll need a site that comes with a software called Content Management System or CMS.

CMS is a type of program installed on the website itself. From here, site owners can control how they want their site to look like. From adding and deleting web pages to modifying its general appearance, CMS updates a website in real time. Websites with CMS cost a couple of thousands of dollars but if you want to save money, you can search online for free CMS scripts.

Blog sites and sites with CMS software require an FTP client to store files from your computer to your web host’s computer. Just like CMS, there are also free FTP programs online and if you use one, it should keep your expenses don to bare minimum.

Ordinary web editor is great for site owners who prefer to forego a CMS or a blogging software. Programs like Dreamweaver are great for professional web masters to develop their website but at almost $400, it’s an expensive tool. However, it’s a small price to pay when you think about the productivity you gain from using such software. But if you prefer free tools for developing your site, KompoZer and Nvu are great alternative to Dreamweaver. Do note that KompoZer and Nvu come with several limitations and the lack of bug fixes also makes it hard to work on. However, they should do when you are developing simple websites for your business.

If say, you want to do all the graphics and image editing on your own, then it pays to get the right tools for it. Photoshop remains as one of the best tool for designing and editing images. The cost is a little under $700 but it’s a great investment once you think about all the functionalities you can play with it. However, if you plan on buying both Dreamweaver and Photoshop then we advise that you get the Adobe Web Premium Suite instead. This package includes Dreamweaver, Photoshop, Acrobat, Flash and other useful tools, in one bundle.

Google AdWords

AdWords is Google’s paid advertising platform, it’s the tiny ads you typically see from top, sides and sometimes bottom parts of the search results. Google AdWords is considered as one of the best paid advertising tool that drives a high volume of traffic to different websites.

These ads will appear once a user types a search query, in the case of the image above, the keyword: web design. Essentially, companies will bid for keywords that are relevant to their business and Google enters thousands of keywords and ads into an “auction” to determine which of these keywords are the most relevant to the search query. Eventually, the winning ads will be displayed prominently on the search results.

For those looking for quick traffic from your business sites, Google AdWords and other Pay-Per-Click Search Engine advertising is the best way to get great way get results. By setting up your own Google AdWord marketing campaign, targeted visitors are delivered to your website almost instantaneously.

Google AdWords works great for site owners who want to see a return on their investment (ROI) while waiting for results on their SEO campaigns or other marketing strategies.

Advantages of Google AdWords

One: Google AdWords is great for quick traffic. Unlike SEO strategies where results can only be seen for weeks on end, advertising via Google AdWords offer almost instantaneous traffic.

Two: Set up is fairly easy. There’s more to Google AdWords than just campaigns like adgroups, keywords, etc., but all these are just puzzle pieces that make up a large marketing campaign. You can research the best keywords that fit your business, work on a budget and set up a campaign. If the ads were approved by Google, then you get huge volume of traffic in no time because approved ads will appear on searches instantly.

Three: Enjoy maximum exposure from the world’s largest and most important search engine, Google!

Four: You get control over your spending, making Google AdWords a great option for site owners on a shoestring budget. Setting up a small, tightly optimized search engine campaign is very cheap and the benefits are almost endless. You can specify how much you want to spend on a campaign. You can set the maximum cost of per click to keywords and pay only for the clicks and nothing else.

Disadvantages of Google AdWords

One: Whether or not a click is converted to a sale, you will pay for each click. This means you may get a lot of clicks from visitors but if they don’t have any intention of buying from you, you don’t earn revenues from the clicks alone.

Two: Number of characters in the headline and the body of the ads are limited. This is why it’s important to focus on attention-grabbing headline, quick show of benefits and a call to action crammed in 25-character headline, 35-character advert body and 35-character in the display URL.

Three: Mistakes are costly. It’s important to set your own campaign right in order to get the right results otherwise; you will spend a lot of money on simple errors.

Four: It’s time and labor-intensive. You need to keep track of your campaign regularly to find out what’s converting and what’s not converting and then adjusting your campaign accordingly.

Five: You can’t depend on Google AdWords for traffic and not work on your SEO because Google will assess the quality of your landing pages. If the landing pages are not up to par, in terms of relevancy to the search query, you will get the maximum benefits of Google AdWords.

On the other hand, Professional PPC campaign may cost as little as $200 per month to more, depending on the industry you are in as well as the amount of traffic you want. Be warned of cheaper campaigns though. Cheaper campaigns tend to yield very little ROI because your money is spend mostly on set up and management alone, rather than the media itself.

Web Marketing

Marketing online comes different forms. Unlike traditional media where your ads are confined in either print, radio or TV ads, online marketing can be done in a variety of ways, including social media marketing, content marketing, affiliate marketing, SEO, etc. Selling products or services online will require heavy marketing to attract more people into a certain business. Investing in a marketing program is probably the most important expenditure in establishing a website. It pays to factor this on your budget.

The great thing about marketing online is it’s relatively cheaper as compared to traditional marketing. Site owners on a shoestring budget can either hire a freelance writer and SEO specialist to handle the online marketing for their business.

Average cost for content writing is $200 per hour but if you want to keep the cost down, you can always outsource content writing in Asia where labor is cheaper without compromising quality. A content writer can work together with the SEO team and create optimized posts that will help boost search rankings.

Search Engine Optimization

All too often, companies big and small depend on their brand in order to generate traffic. Don’t get me wrong, there’s nothing wrong about relying on your carefully built brand identity to attract buyers into your business. However, there are other ways to entice buying customers into your business. SEO is just one of the most effective ways to market your business online. And if you don’t integrate SEO into your marketing strategy, you could be missing out on millions of dollars in profits!

Through carefully selected SEO strategies, site owners can influence the appearance of a website in a search engine’s unpaid or organic search results. This will lead to more exposure among buying customers and inevitably leads to more sales and bugger profits. Most traffic is generated by article directories and search engines. Some sites see an increase of traffic by up to 60% from major search engines like Google, Yahoo! and/or Bing.

The principle behind SEO is to improve a website’s position in the search engine’s search result page using specific terms used by online users. If a site ranks high on the search engine’s result page, more visitors will click its link, leading to an increase in organic traffic.

Organic search engine traffic is free, which means there’s no click costs to consider but generating traffic organically will require expert marketers. An SEO program is an excellent tool that will maximize this free traffic.

In order to maximize the changes of landing the top spots in search results, SEO specialists will try to figure out how search engine works. They will take note of what users are commonly searching for and conduct an extensive analysis of actual search terms users will key into search engines known as keywords.

What are Keywords?

Keywords refer to search terms used by online users in an attempt to search for information via search engines like Google or Yahoo! For example, if a user wanted to know more about web design in Brisbane, he can simply key in the keywords “web design Brisbane” on the search bar. Within seconds, Google will present various resources relating to the keywords.

Typically, the user will click on the links listed on the first page of the searches. The first page of the search results is the plum spot that SEO specialists across the world are fighting tooth and nail for. If you make it on the first page of Google’s search results, you are guaranteed a massive spike in targeted traffic.

How Do You Research for Keywords?

Keyword research is a process that involves getting into the head of potential customers, determine what terms they are likely to use in order to search for your business and uncover a set of keywords to be used for content optimization. By using keywords integrated into your content, you maximize the chances of landing the first page of Google’s search results or at best, get a decent ranking for it.

In order to research for the best keywords that correspond to your business, you will need a special program to analyze your market. Paid keyword research tools are pretty expensive, with some costing anywhere from $200 to $500. The good news is, Google has its own Keyword Research Tool and it’s absolutely free. Best of all, it works just as great as any other paid keyword research tools in the market, maybe even better. So before you even think about shelling your hard-earned cash on some paid marketing tools, it pays to check if Google offers similar tools for free. You just might save hundreds of dollars.

Once you’ve done your research and have a list of excellent keywords, you can then integrate them into your content. Google’s crawlers will index your content and identify the relevance of your targeted keywords according to your business. This will help increase the chances of landing the top spot at Google’s search results.

An SEO program is by no means cheap. In terms of the rates, industry-leading SEO specialists will set you back $1,000 per hour of work rendered. Price goes down when you outsource SEO specialists from India or the Philippines.

In 2011, Rand Fishkin of SEOMoz ran an article relating to SEO pricing in major parts of the world. The comprehensive study was based on 600+ responses received from individuals from the US, the UK, Canada, Australia, New Zealand, Germany, France, Italy, Netherlands and India.

The rates were two years old and as you can imagine, prices has gone down since then. However, this study illustrates how SEO is an integral part of website promotions. If you want to attract millions of buying customers into your business, you’d be hard-pressed to find a better way to generate buzz than through effective SEO techniques.

When it comes to developing an SEO campaign managed by a skilled SEO specialist, expect the minimum rates go for $500 up to $1,000 maximum.

Link Building For SEO: The Misconception

During the infancy of SEO, rankings may be boosted by linking your site to other sites of the same niche, industry, or quality. This done through an SEO process called Link Building. An SEO specialist will create a list of trusted, high quality sites, blog sites, forums or articles and will attempt to increase rankings by leaving comments linked with the site he is optimizing or by being added to the site owners’ blogroll. If an SEO specialist was able to link a large number of quality sites to the site he is optimizing, the quality of that site improves, according to the point of view of the search engine.

Today, link building is considered as an old practice that’s likely to die down. Various algorithm updates by Google improved the process on measuring a site for rankings. Meaning, technology made Google smarter, making SEO as complex as ever. These days, if a site is linked to a large number of low quality sites, Google will get the impression that the site owner paid for these links rather than getting them organically.

Link building of SEO of yore is no longer as effective as it once was. In order to effectively optimize your website, you will need to generate healthy inbound link profiles and using the best keywords to integrate to your content. Other factors to consider when analyzing the quality of your site and improving its rankings include:

  • Content quality
  • Regular content updates
  • Frequency of visitor engagement (including social media engagement or via comment section)
  • HTML Everything: HTML tags, HTML META descriptions, and HTML headings
  • Keyword integrated in the website copy
  • Website loading speed
  • Online reputation
  • General URL structure of the site
  • Anchor texts used in hyperlinks
  • Domain name age
  • Social reputation
  • How many people blocked your site from search results

Search Engine Optimization Today

As technological advances made search engines smarter than ever (particularly Google after a medley of updates in 2011 and 2012), more and more factors are now being considered in order to figure out how search engines measure quality. SEO has become more complex than ever, figuring out what works and what don’t work is an uphill climb for even the best SEO specialists. However, as long as you take full advantage of optimizing your HTML tags, heading, and descriptions and of course, focusing on creating high quality content regularly, you should see an improvement on your rankings.

Online Newsletter

The advent of the internet paved way for cost effective publishing online and one of the fastest growing segments of company publishing is online newsletter.

Newsletters are great ways to provide current news about your business, sell products and even manage your affiliate marketing’s backend. For many site owners, an opt-in email newsletter is an integral part of their marketing efforts. And why not? It’s a cheap and effective way to build community with customers, get in touch with suppliers or business partners and spread information about specific businesses/services online. Without a newsletter, you’d be missing out on attracting more customers and encouraging them to make a purchase.

Does Your Business Need Online Newsletter?

The quick answer is yes; your business needs an online newsletter. Not only is online newsletter a great way to open the floodgates of communication between you and your readers, it also makes for an effective SEO strategy, which we will sink our teeth into later on this post.

In terms of engaging your customers, online newsletter works great because:

It Keeps Customers in the Loop: What latest services does your business offer? What exclusive deals are you launching this week? Online newsletters help keep your readers abreast with the latest offers or information relating to your business.

Offer Effective Solutions: By presenting informative articles or practical tips on how to resolve your customers’ problems, you position yourself as an expert in your niche and your customers will turn to you for help, which will improve your reputation and make you a credible source of information. All these will lead to more sales and repeat purchases in the future.

Touch Base with Old Customers: Sending out newsletters to old customers is a perfect opportunity to touch base and maybe get them to know more about your latest offers. It’s a great way to bring back customers who haven’t purchased anything from you for a while. Newsletters works well as a platform for engaging with customers on a more personal level.

Creating a weekly or monthly newsletter not only helps your business achieve the benefits mentioned above, set up is fairly easy too. It only makes sense to include online newsletters to your existing marketing campaign to increase online profitability.

SEO Benefits of Online Newsletters

Although online newsletters have long been regarded as a minor player in Search Engine Optimization, this couldn’t be further from the truth. The fact is, more than ever, online newsletter provides enormous SEO benefits for online businesses. You can expect huge leaps in your SEO campaign when you publish online newsletters to your customers.


Because Google is all about quality content these days. Aside from anchor text links and backlinks, original, high quality content is one of the best ways to get noticed by major search engines. The more quality content you publish, the higher the chances of being indexed and achieving better rankings. By updating content on a weekly or monthly basis, Google’s crawlers will index fresh updates and this will result in higher ranking.

Using an online .php or .HTML page to create great articles will dramatically boost your SEO campaign! What’s more, you can link these pages internally to other pages of the website for enhanced optimization. Finally, newsletters not only help improve the SEO element of your web marketing campaign, it also gives a more human element to your business that customers can reach out to and engage in communication with.

Online Newsletter Costs

In terms of the cost of publishing an online newsletter every week or every month, prices will vary according to service providers, the quality of the newsletter and the number of contacts to send the newsletter from. For instance, iContact, a service provider that provideshigh quality, HTML-based newsletters offers a monthly fee of $14.99 for 500 contacts and as much as $699 a month for 100,000 contacts.

Mail Chimp, one of the more widely used online newsletter service provider, offers paid and free services. The free service is offered for up to 2,000 subscribers. That yields around 12,000 emails each month. The paid services cost around $10 each month for unlimited emails. What’s great about Mail Chimp is that the format of the newsletter will mimic your own website design. They also offer a great selection of tools to create HTML-based emails. Quality is good but compared with iContact, which offers premium service, the latter offers better-looking newsletter layouts. However, Mail Chimp is a great place to start for those who are venturing into online newsletter for the first time or for business owners who are looking to save money on newsletter publishing.

Other notable service providers include ConstantContacts that offers newsletter plans at $15 per month with a free 60-day trial and Benchmark Email which offer their plan at $9.95. Benchmark Email is the preferred newsletter service provider of many businesses because the package comes complete with email newsletters, HTML templates, Real-Time Reports, Contact List Management, RSS and Social Media reports and other useful features.


When it comes to expenses leading up to owning a fully functional website, the devil is in the details. As you have learned, there are many variables that make up the total value of a website. From registering a domain name to paying for ongoing SEO or social media networking and any other ad campaigns, would-be business owners must factor all the important elements that make a successful website in order to enhance their own business.

Tina Lee-Almazar | Tinaciouslee

Tina Lee-Almazar is a writer and editor based in the Philippines. She holds a Bachelor’s degree in Broadcasting from Centro Escolar University in Manila. She started out as a production associate at ABS-CBN Broadcasting Network in 2004 before transitioning to creative writing in 2006. Her years of experience as a writer resulted in having considerable knowledge in a variety of writing fields. When she’s not surrounding herself with pretty things or discussing herself in the third person, Tina watches funny cat videos all day.

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