Strategic Website Planning: Part 1

Building a website isn’t complicated. Well, nothing has to be complicated about it. Just about anyone can build a website on GoDaddy, but it may end up looking something like this.

Building a purposeful, strategic website is complicated. It’s a science. And it’s an art.

I would like to share the web engineering process we like to use at Buckeye Interactive for building websites (or web experiences, as we like to call them). These are the components of our Strategy & Architecture phase, the initial planning portion of our process:

  • 1. Business/Organization Context
  • 2. Measurable Goals
  • 3. Competitor Analysis
  • 4. Brand Messaging

Following Strategy & Architecture, we have Content Planning, Design and Development phases, but these four components are the bulk of the planning process. We will cover Content Planning and Design in future articles.

Because the planning process can be extensive, and I want to provide examples, today’s article will just cover Business/Organization Context and Measurable Goals. Next month we will discuss Competitor Analysis and Brand Messaging, as well as Web Application Planning.

E-commerce sites, websites that include shopping carts and payment processing, follow a similar process, though the primary goal is generating revenue directly on the site. When building web applications, or websites with richer interaction, usually with logged-in users, the process is a bit different. I will cover some of the differences in Part 2 of this article.

Part 1: Planning Marketing and E-commerce Websites

Before starting a web design and development project, it’s important to really understand the purpose of the site and what a successful website would do for your business or organization. Most website redesign projects are initiated when the site looks old (like your dad wearing clothes from the 70s), or the information is out of date. These are both valid concerns, and they should be addressed as part of the project, but they shouldn’t drive the planning process.

1. Business/Organization Context

Flying blindly into a website redesign armed only with a knowledge of what currently looks trendy on websites totally neglects the purpose of the site, and its greater value to the organization on a strategic level. Instead of starting with the look of the site or the content, start with a thorough understanding of the business, its brand, its competitive positioning in the market and its strategic goals over the next  three to five years. A brief history of the company is necessary to understand where the business has been and where it is headed. Considering the overall business goals for the next three, five or 10 years along with the challenges a company faces can help us understand what role the website should play in attaining those goals.

For instance:

  • A company that wants to grow from $250,000/year to $1,000,000/year in revenue in three to five years, with a challenge of finding new customers should focus on lead generation, or collecting information from prospective customers, increasing traffic from search engines and possibly online advertising.
  • A business that already has $2,000,000/year in revenue but isn’t profitable may need to find ways to decrease customer acquisition costs or operational costs through an online knowledge base or self-service tools on the company’s website.
  • Another business may be pre-revenue with a huge opportunity to sell a new, unique product online. Their website will need to focus on customer education, communicating a clear and compelling value proposition and online sales revenue.
  • A church or non-profit that has seen a decline in pledges or had difficulty collecting donations from members may consider automated, recurring online donations, or maybe even features that engage members more to increase their giving.

Whatever the organization’s objectives, historical challenges and future opportunities are, the website needs to consider this context before blindly building a more modern website with new content. Otherwise, your fancy, updated website may fail to help you achieve anything meaningful.

2. Measurable Goals

Not only do you need to understand the context and what your website can do to help your organization, but you need to set measurable goals. This does not simply mean setting a goal for monthly page views or unique visitors on your website. These goals need to be tied closely to your organization’s overall strategic goals. The examples above provide a good starting point for identifying what a website can do for the organization, but collecting quantifiable data around key metrics will help you measure performance over time.

Most organizations need sales of some sort, whether a sale is a product or service, a new member or a donation. I like to work with organizations to determine the cost of acquiring a new sale, and select metrics that will help us measure the cost of a sale on the website. In an e-commerce business, this is particularly easy. We typically use Google Analytics for most of our e-commerce metrics, and the most important factors are conversion rate, or the percentage of visitors who make a purchase, and average transaction amount. Total sales are fun to see, but focusing on the conversion rate and average transaction amount tells us what should happen if we can drive more traffic to a website.

For example (I’m sorry in advance for those who aren’t a fan of numbers) if we know that 5 percent of visitors purchase, and an average purchase is $50, then I can conclude that a visit is worth $2.50 (5% x $50) in revenue. Let’s assume the products I sell for $50 cost me $25 to make or buy (a 50 percent gross margin), then the value of each visit is really $1.25 (50% gross margin x $2.50 in revenue/visit). Now if we can buy advertising for anything less than $1.25 per click or per visit, our operation will be profitable. We will need to track these metrics on an ongoing basis and test our assumptions to make sure they are accurate.

A similar calculation can be made for organizations without online sales. Let’s use a non-profit example so that it’s clear this sort of logic applies to any organization, whether a new lead is for a potential customer, member or donor.

A church is building a new website because its membership and donation income have declined in recent years, resulting in financial difficulties. The church needs new members, and an updated web presence can help present the congregation in a professional, modern light to those looking for a church. Donations from members average $500/year, and the average member stays with the church for five years. That’s a lifetime value of $2,500. Note that we neglected customer lifetime value in our previous example, and we will also neglect the time value of money for simplicity in this example.

On the website, we will add a New Member Interest form that collects information from families looking for a new church. Hopefully we have some historical record of how many people have expressed interest in the past, and what percentage of those join the church. If not, now is as good a time as any to start collecting that data. Let’s say 10 percent of those who express interest end up joining the church, and on our website,  3 percent of visitors fill out the New Member Interest form. We now know that a visitor on the website is worth approximately $76.50 ($2500 x 10% x 3%).

Again, we need to consider the money that goes to the cost of providing services, which for a church, may be 90 percent of what’s donated (so that 90 percent of the donations go to missions and programming, and 10 percent go to the cost of acquiring new members). If these assumptions are accurate, and we will know by the data we collect if the are, then the church should be willing to spend as much as $7.65 for a single visitor to the website! As part of the $7.65/visitor, though, they will need to account for the cost of developing and hosting the site, advertising, and the creation of website content.

These numbers aren’t necessarily accurate for any business or church, but they do illustrate the process we follow. There are plenty of other considerations including cash flow concerns (does a church really have the money up-front to spend on advertising?), overhead and fulfillment costs for businesses, and most importantly the accuracy of assumptions. We have to start with some assumptions before accurate data is collected, but it is vital to return to this planning process regularly to re-calculate what a prudent investment is.

I promise we’re done with numbers. Thanks for bearing with me.

Next Steps

Our next articles will cover the third and fourth components of our Strategy & Architecture phase, Competitor Analysis and Brand Messaging. Hopefully you have enough now to start your planning process.

Please do join in the conversation by adding your comments here, or on Facebook and Twitter. We would love to hear your feedback and ideas for strategic website planning.

Thanks for reading. Look for our column next month for Part 2!

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Brad Griffith is a life-long entrepreneur. He grew up working for his dad's veterinary hospital, learning the joys and challenges of business ownership. Brad is now President of Buckeye Interactive, the web strategy and engineering agency he started four years ago, and Chief Technology Officer at SmartCrowdz, a mass-participation event management technology startup. Prior to starting Buckeye Interactive, Brad spent several years consulting and developing web applications in-house for a variety of companies including JPMorgan Chase, QUALCOMM and the Go Big Network. Brad earned his Masters in Business Administration after completing his Bachelor's in Electrical and Computer Engineering with honors, both at from The Ohio State University. He has more than 15 years of web development experience and has worked from coast to coast with small and large companies, educational institutions, non-profit organizations and government agencies to build innovative web solutions.