$137.8B U.S. ad spend for top 200 advertisers
Mr. Crisp, who with his wife, Valerie, runs a Web-hosting and development company out of their Raleigh, N.C., apartment, says he can put up quality Web sites for just a few hundred dollars -- literally a fraction of what major Web developers charge.
Mr. Crisp is an extremely low-cost Web presence provider whose Pageplan service is one of thousands that offer marketers a rock-bottom alternative to the five-and six-figure bids from full-service Web developers. After all, why spend $100,000 when $600 will put your company on the Web?
Not surprisingly, this kind of reasoning drives Web developers crazy. They warn marketers of the limitations of low-priced sites, and analysts agree.
"A couple of guys with a computer can put up a Web site, and they do. And maybe it even works. But is it the image the company wants to project?" said Josh Bernoff, a senior analyst with Forrester Research.
"Lord knows if you have a serious concern about your image, you have to work with a company with expertise in both advertising and marketing," he said.
PEOPLE BEING SEDUCED
For Mr. Crisp, that argument doesn't wash. He says he can charge less because he doesn't talk clients into services they don't need, or overcharge them for what they get. That's exactly what many of his competitors are doing, he says."The rule of thumb appears to be if you can charge customers something, do it," said Mr. Crisp, who has a high-speed transmission line running into his bed-room/office, where seven Macintosh Web servers are laid out on two folding tables.
"A lot of people are being seduced by Web developers touting techno-glitz," he said. "People are buying things they just don't need. It's why prices are all over the place."
Industry experts say Mr. Crisp has a point about the Web market's irrationality, if not necessarily the reasons for it. NetMarketing's Web Price Index reveals variations of up to 1,000% on bids to design the exact same site.
For example, the bids for a small site (about 20 pages with minimal extra technology), range from a low of $2,800 to a high of $200,000. Mr. Crisp says he could do that site for $600.
TOO MUCH VARIATION
That level of price variation offers little comfort to marketers, whose jobs are on the line if they spend too much for a Web site or achieve too little with the dollars they have.
Even the most basic decisionwhat size company to go withis complicated.
At the high end are companies such as Vivid Studios and Poppe.com, large firms that can do million-dollar-plus sites. They tell marketers their money is buying stability, experience and an integrated marketing approachsomething they say no company that takes its business seriously can do without.
Go with someone cheap, they warn, and you're likely to get what you pay for.
"People have told us they can get a college kid to do their site for a tenth of what we're charging them," said Nathan Shedroff, the creative director at Vivid Studios, a San Francisco developer noted for its expensive, and much-praised, Web sites. "We say go ahead, but don't expect us to fix it."
'NOT ROCKET SCIENCE'
That attitude galls Mr. Crisp, 40, and wife Valerie, 25. Five months ago, they bankrolled their new company by taking $22,000 out of savings and putting $30,000 on their credit cards, their business plan hasn't wavered.
Mr. Crisp said they took the risk because they're convinced their business plan makes sense. Web hosting is the core. If the hosting service can sign up 80 individual and 40 business accounts, he said, the company will be self-sustaining.
But they are confident they also can make a go of Web development. "It isn't rocket science," Mr. Crisp said.
Mr. Crisp is a former radio personality and bookstore owner who learned most of what he knows about advertising and marketing working at a university newspaper. His wife, a graduate student in psychology, currently teaches an introductory computer science course at North Carolina State University.
QUALITY AND LOW COST
They say their goal is to provide "top-quality Web advertising at the lowest possible cost."
Mr. Crisp said the company offers "full-force Web design," including original logos, text editing, e-mail, search engines and underlying HTML.
"There are things we don't do because they're a waste of a customer's time, and especially money," Mr. Crisp said. That includes most Java applications, Real Audio streaming and complicated graphics.
Industry analysts agree there is a market for no-frills companies like Mr. Crisp's, especially among small businesses taking their first step onto the Internet.
"Right now, 40% of all dot-com sites are in the early stages of development. Those are the sites most often served by Web presence providers," said Greg Wester, research director for the Yankee Group.
But within the next few years, he said, that percentage will shrink dramatically, as will the market for low-cost firms. By 1999, Mr. Wester said, only about 16% of Web sites will be serviced by WPPs.
"Many of their customers are simply going to outgrow them," he said.
LESS THAN 5,000
There are no hard numbers on how many low-cost developers are out there. Mr. Wester estimated fewer than 5,000. Mr. Bernoff, the analyst with Forrester, said the number really doesn't make much difference.
"The real question is whether it matters to companies with any money to spend," he said. "It's like asking how many quick printers there are that can do a brochure.
"If you're a company that just wants to make a small investmentsay a price list, product list, maybe a mapthen low-cost providers can be useful," he said. "But when you are trying to deliver something interactive, you have to be careful, both with content and the technical aspects."
Experts, especially the higher-priced developers, say the best way to be careful is to go with someone established, someone whose work you can see.
"Many of the small companies don't think of Web sites as a marketing tool, part of an integrated marketing approach," said Tom Wharton, senior VP and general manager of Poppe.com, the Web arm of Poppe Tyson, a New York-based advertising agency.
"A lot of small companies are too deeply rooted in technology," Mr. Wharton said. "They can do an application, but they can't tell you what it will do for you. This is marketing, not production. They just don't have the expertise."
ARCHITECTURE OF SITE IMPORTANT
Also important is a company's ability to handle the "intuitive architecture" of a site --the engineering that helps a user get around, said Terry Mallard, president of Inlet, Cedar Rapids, Iowa, which does sites ranging in price from $2,500 to $200,000.
"That's a specialty," he said. "You certainly don't want to end up with a developer who is learning as they do your site."
Mr. Shedroff, of Vivid Studios, said one of the biggest differences between high- and low-cost developers is quality assurance.
"A small firm isn't going to worry about whether the site is going to work as well with Explorer as with Netscape. That can make a big difference," Mr. Shedroff said.
Another major difference, he said, is the professionalism of the visual design and illustration.
"Does it look like someone's significant other did it? Is it extending the brand name or trashing it?" Mr. Shedroff asked. "Firms like that are fine for Joe's T-shirt shop, but not for Coca-Cola, or even a moderate-sized company that takes itself seriously."
Everyone questioned said marketers need to consider their company's future when price-shopping a Web site.
"You must keep your eye on your second-generation costs," the Yankee Group's Mr. Wester said. "You may want to totally redevelop the site the next time around. If it's not flexible enough, the money spent just to get online will have been wasted."
Small companies can do big work, but not for peanuts, said Mr. Wester. "Most low-cost companies don't need to get bigger," he said. "They need to get better."