This of course is a loaded question. Yet it’s still very much worth asking, and very interesting to answer. Obviously, there is no one single answer to this. There are lots of variables that impact what the right level of investment might be for any given business or venture.
Let me share a brief summary of my philosophy on this topic first before delving into the details. In my opinion based on 17-years of site development with hundreds of clients and partners, there is a minimum bar for quality, depth of content and/or functionality that has to be met. Meaning, if you fall short of the bar, you lose. Whether you win or lose does relate heavily to your investment. Or at least, more specifically to the value you create. Because you might have a relatively small investment, but thanks to good planning, smart decisions, you actually create a lot of value with a relatively small budget.
Despite exceptions however, if everything else is equal and every $1,000 you put into your website gets you a certain level of progress – then the total investment does significantly impact whether or not you can win in the market. And on some level it is exactly that especially for lead-generating websites in specific industries, often geographic based, it is a competition. You’re either at or near the top and therefore winning by having profitable leads flow in consistently, or your site is struggling to get traffic and lead generation is weak leading to a cycle that is the opposite of what we want. Because what we want is profit, invest, increased profit, increased investment, we want that upward cycle that creates not only growth, but compound growth.
It’s important to make some distinctions when talking about website investment.