Maintaining your site is never free, whether you manage it internally or externally. Outsourcing to an agency makes the costs concrete (and sure that’s scary). Often times, when people evaluate the cost of an agency they have nothing to compare it to. Or, they have a number, but that number is artificially low. As a result, people wildly underestimate the costs or the opportunity costs of doing their own maintenance.
Simply put, you should at least be allocating old funds into new funds. Luckily you have access to the brains here at Blue Acorn, and we’re going to help simplify and clarify some of the components that you should add to your ecommerce site maintenance budget. By ignoring the important factors that often occur throughout the year, you may be overlooking costs that will ding you later.
While you could maintain your own site instead of paying an agency, it will cost you time, labor, opportunity, and quality. It’s even possible that the dollar-for-dollar costs are more when you do it yourself; however, this is dependent on knowing your internal costs and the quality of your in-house resources. Maybe you are holding several talented developers hostage in your basement, and good maintenance costs you no more than a loaf of bread and some water every day. On the other hand, you may know your costs, but if you don’t, it would not be incredibly surprising. And, even when brands do know their overhead and budget needs, we almost always find additional costs they hadn’t considered with just a few questions (think minimal tire tread vs mechanic finding something that could improve just performance).
To make things easy, we put together a list of the best questions for figuring out the total cost of what you’re spending right now. You can use the basic formula below to get a better idea of how much you are spending. This should give you a rough idea of how much you should budget at a minimum just to maintain your site (not counting the extra hours and research for updating or adding new features).
Answer the following questions:
- What are the responsibilities tied to only site maintenance?
- Who is maintaining them?
- How much is their time worth?
- How much of their time is spent on these things?
By answering the above, you’ll have a rough idea of how much is already being spent to simply maintain your site and how much time should be set aside for it. Pretty easy, right? However, for a more in-depth look, ultimately you need to compare employee costs to the related list of responsibilities, so let’s dig in.
- How many employees and how long does it take to manage the backlog?
- Who manages, collects, and prioritizes requests from dozens of people, yielding more time spent building requirements?
- Who acts as regular support (coaching new and existing team members)?
- Who adds new features and how long do they typically take to implement?
- How long does it take to QA new or improved updates?
- How long does it take to onboard new technology, especially associated with new features? How long does it take to educate the team?
- Time to implement things like Listrak, Tealium, Monetate
- How long does it take to write code?
- How long does it take to design around the new or improved features?
Multiply these costs by the percentage of time spent maintaining the site:
- Percentage of workspace
Adding It Up
Now, take the two sets of numbers and drop them into this simple formula:
Total employee cost x Total level of effort cost = Your estimated site maintenance budget amount. But wait, you’re not quite done yet. Now include these often necessary components:
- 24/7 support (~15 hours from revenue)
- Access to powerful tools and resources (subscriptions, fees, etc.)
- Time spent custom developing everything
- Time spent guessing what’s going wrong (vs crowd-sourcing solution at an agency)
- Diversity of skill set and experience, subject matter experts
- More objective input on your site
In-house Versus Agency Maintenance
When it comes down to dollars and cents, it may not make sense for every brand to maintain their own site. For those who are more advanced, often require custom development, need access to the latest and greatest tools, and need to receive timely support, an agency makes financial sense. To get a better understanding of how you can utilize an agency partner to knockout your backlog, reach out to our team.