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Survey shows that variations come in how companies break down tasks

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Ever wonder why our Web Price Index shows such variation in pricing among developers? Well, one reason has to do with hourly rates and how they're assigned.

This month, NetMarketing's survey looks at hourly pricing for Web services. We asked the participating developers to give us the rate cards that they use to create the estimates.

The biggest variance wasn't in terms of price, but in terms of how individual developers break up tasks and estimates. We asked the developers to provide us with hourly prices for design, programming and site planning, then we broke the data down even further into six categories that most of the developers had in common.

These were Basic HTML, CGI scripting, copywriting, Java/Shockwave programming, interface/graphic design and Database programming.

SMALLER DEVIATIONS

The results ranged from a national median of $90 per hour for basic HTML service to $150 per hour for more rugged database-related programming (See chart). Although there certainly was variation in hourly rates, overall there were smaller deviations from the median than in past months.

So where do the overall variations come from?

Marketers and developers need to be aware that this is a young industry. There are no standards in terms of pricing. Each developer and agency looks at a project differently, and most will sit down with the clients to get an understanding of exactly what they are looking for and how best to implement it. Much of this discussion takes place even before a bid is presented.

"We are typically working on more complex sites -- commerce sites or online training that have a specific business purpose. Regardless of complexity, we conduct an interactive audit and assess with our clients their needs and how interactive solutions can benefit their businesses," says Amy LaBan, director of marketing and strategic relations at Eagle River Interactive, Chicago.

Developers also point out that the actual rates are flexible depending on the size of the project. If developers and agencies see the potential for a long-term relationship they can be accommodating in their rate card.

DISCOUNT FOR LARGER BUDGETS

"We discount our hourly rates slightly on larger budget projects," says Steve Klinenberg, VP-general manager of DigitalFacades, Los Angeles.

"This is done because the overhead of getting a project going is reduced when you have one large project vs. five small ones. We think of it the same way other businesses have volume discounts."

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