If you have read up on Magento, chances are you have been told that the price is not insignificant. While this may be true compared to a number of other platforms, you have to remember that you get what you pay for, and the additional outlay could be very much worth it if what you spend leads to a higher annual revenue. Here we will explore all of the costs associated with this platform so that you know exactly what you will be paying out and what the rewards will be.
Right at the start, we want you to know we can help. We’re a Magento agency. We have built and maintained websites using Magento for years. At the end of this article, you can contact us for help to get started.
Now, let’s get into what Magento is and how much it costs.
What Are the Different Magento Editions?
If you have decided to go with Magento as your eCommerce platform of choice, you must understand the different versions that are available. There are different hosting options through this platform that vary in cost, and so the one you choose, as always, must be the one that best fits your online business requirements.
Free Option – Magento Open Source
Magento Open Source is a free version of this platform designed for businesses of a limited scale. However, simply because the platform itself is free to download does not mean the development process has no cost. Even the basic features to enable you to operate effectively online do not come cheap. Hosting costs, coding from freelance developers, and configuration will all add up, and even with little in the way of third-party integration, you are looking at around $15,000.
More Advanced Options – Magento Commerce and Magento Commerce Cloud
Magento Commerce and Magento Commerce Cloud are worth looking at if your monthly revenue is high enough to justify the somewhat hefty price. What you are paying for is the advanced functionality that enables you to make the most of your online stores. Prices for these platforms start at $22,000 but go as high as $190,000 if your annual revenue goes over $25,000,000.
Pricing and Capabilities of Magento Editions
Magento Open Source Features and Costs
Features of Magento Open Source
Magento Open Source may not have a wide range of features like some of the other platforms, but it still allows you to add different elements to your products such as size, color, or fabric type and will allow customers to categorize these to fit their requirements. You can also use email templates to wow your customers; these are adaptable to mobile devices so they will not lose any impact no matter the screen size. Google Analytics can be implemented in order to analyze your customers’ online purchases and generate additional sales by taking this into account going forward.
Pricing of Magento Open Source
Magento Open Source, unless you have the experience level with coding to implement the changes you require, will cost in the region of $15,000 for you to create a website that will allow you to run your eCommerce business effectively.
Magento Commerce Features and Costs
Features of Magento Commerce
Magento Commerce has a number of marketing tools and extra benefits that you will not get with Open Source. For example, you can maximize sales by creating personalized promotions as well as offering rewards and incentives to loyal customers. You can also have features such as ‘popular items,’, which play a crucial role in enhancing the customer experience.
Pricing of Magento Commerce
If you are running an enterprise-sized business, then Magento Commerce will better fit your needs than Open Source. This platform used to be known as Magento Enterprise and is the one for you if you are running more complex eCommerce operations due to the scale of your business. The Magento license cost for this will depend on your annual revenue, starting at $22,000 if you generate less than $1,000,000 in sales per year to well over $100,000 if your annual revenue is $25,000,000 or above. The obvious benefit here is that the cost will reflect the volume of your online sales so there is no risk involved in that sense.
Magento Commerce Cloud Features and Costs
Features of Magento Commerce Cloud
There are some key features that make Magento Commerce Cloud worth the additional cost if your revenue allows you to afford it. This platform has extra fast loading times and will allow your website to update in real time so that the user experience is superb, and you will likely generate a lot of extra sales as a result. The Magento Commerce Cloud license is worth having because it will mean your website automatically incorporates the latest Magento updates. If you are running a large operation, then this platform is very much worth considering.
Pricing of Magento Commerce Cloud
Magento Commerce Cloud is similar to Magento Commerce but there are some key variations. For example, Magento Commerce Cloud is designed to integrate with many 3rd party apps and features to power advanced CRM and ERP functions used by larger businesses. It is a more expensive option than Magento Commerce, starting at $40,000 with an upper range of $190,000, again based on the volume of sales.
Price Comparison for Magento Commerce and Magento Commerce Cloud
| Annual Sales Revenue | Magento Commerce | Magento Commerce Cloud |
| $0-1 million | $22,000.00 | $40,000.00 |
| $1-5 million | $37,000.00 | $55,000.00 |
| $5-10 million | $49,000.00 | $80,000.00 |
| $10-25 million | $75,000.00 | $120,000.00 |
| $25-50 million | $125,000.00 | $190,000.00 |
Third Party Development Through Magento
In order to ensure performance optimization for your website and to ensure you can make the most of any advanced features, unless you or your own house team have a high level of technical expertise, you will have to pay a third party to assist you with development. There are several options.
Using a Web Development Agency
The most expensive of these third-party services is to pay for an agency to develop your website. The pricing plan for this can vary from between $25 to $200 per hour, so it is the option to use if you want and can afford the best possible eCommerce experts in web development. The monthly costs may be very substantial with this option, and so it is probably only worth considering if you are running a large scale business operation.
Using a Freelancer
Although using freelancers can be expensive, it can work out to be far more cost-effective than using an agency if you look in the right place. In this modern world where instant communication is possible across the globe, you can likely source a Magento freelancer for web development for around $10-20 per hour, or if you look to Eastern Europe the price could be somewhere in the region of $20-60 per hour. A freelancer in the Western world may charge anything from $150-200 per hour, so it is not a cheap option; but if you are looking for someone who truly speaks your language and fully understands the needs that can be related to commerce in your country, then this could be the way to go.
Your Own In-House Development Team
The main advantage of having an in-house team take care of your web development is the level of directness and control they will offer, as well as the ability to keep on track with all of the latest Magento developments and updates. Wages for a developer who is just starting out will be in the region of $60,000 per year, while someone who is more experienced may cost twice as much. With an in-house development team, you know they will be focused completely on your business, whereas freelancers or agencies are likely to have several different projects on the go at once.
| Magento Open Source | Magento Commerce | Magento Commerce Cloud | |
|---|---|---|---|
| Magento license cost | 0 | $22,000–125,000/year | $40,000–190,000/year |
| Hosting | $100–500/year | $500–6,500/year | 0 |
| Domain name | $10–400/year | $10–400/year | $10–400/year |
| SSL certificate | $50–300/year | $5–300/year | $50–300/year |
| Design | $0–5,000+ | $0–5,000+ | $0–5,000+ |
| Development | $1,800–10,000+ | $10,000+ | $10,000+ |
| Extensions | $60–600/extension | $60–600/extension | $10,000+ |
| Payment providers fees | 2.9% + $0.30 per transaction | 2.9% + $0.30 per transaction | 2.9% + $0.30 per transaction |
| SEO & digital promotion | $10,000–40,000/year | $10,000–40,000/year | $10,000–40,000/year |
| Total Magento development fees | $12,000–57,000+ | $43,000–189,000+ | $60,000–247,000+ |
What Is the Cost of Web Hosting Through Magento?
An important consideration when it comes to implementing your online store is web hosting. This is where all of the data relating to your site will be stored, and so security is important as well as high quality, which will allow your site to be optimized for different search engines and to perform at a fast speed rather than taking a long time to load and being off-putting for your customers.
Hosting will cost between $10 and $850 per month, depending on your requirements. You should make sure that the host you choose offers a Virtual Private Server and is compatible with all of the Magento features.
What Is the Cost With Magento Themes?
Branding and Visual Themes
Choosing the right theme for your website is crucial because this is how the customer sees your brand. Potential customers will be attracted by impressive graphics and the overall visual appearance. There are a couple of different options for you to consider.
Magento Theme Templates
There are many Magento themes to choose from to suit every budget. Some are free, others may be $200 or more, but what will often happen is that someone will pay for one of these themes and then hire developers to customize it in order to fit with the company’s specific requirements.
Magento Themes with Customization
If you have a very clear vision of what you are looking for that does not fit with the existing templates, then you can employ an in-house development team or freelancers who can turn your ideas into an impressive website that will wow consumers. Customizing the theme may be a single expense. However, using a custom theme often means going back to make minor changes regularly, so this could turn into an expensive option.
Magento Third-Party Extensions
There are various Magento extensions available that can bring new functions to your online store. These will range in price from around $50 to $500. A word of advice would be to ensure their compatibility with any existing extensions you may have, as if they are not compatible, they can cause your site to run slow or even crash. Make sure they have been tested in this way before you implement them on your website.
Search Engine Optimization Cost Through Magento
Search Engine Optimization is a vital component to factor into the budget for your Magento store. If your site does not appear on the first page, the higher up the better when it comes to a Google search, then you will simply not be able to compete in the modern eCommerce world. The services of an SEO specialist do not come for free; in fact they can cost around $44,000 per year, but the extra money you spend can translate to a high volume of additional sales when your site is getting noticed by thousands more people. As with all aspects of your overall budget, you have to think in terms of the potential reward.
Magento Agency vs In-House Management of Website
Whether you go with your own in-house team or a Magento agency to manage and maintain your website depends on the level of Magento-specific knowledge and expertise required to keep the site running smoothly. If you use a lot of Magento extensions and features, then it may require the hands-on knowledge of a Magento agency to keep everything on track.
You can use an in-house team if you already have one who has built a custom template and are confident that they can handle the ongoing maintenance and security. A Magento customer support specialist will generally cost in the region of $40,000 per year, while the cost of store maintenance from a Magento Agency will be in the region of $80-$125 per hour.
Some Common Queries
Why Is Magento More Costly than a Number of other Platforms?
Magento is not considered to be a cheap platform, but the reason for this is the flexibility it offers and the complexity of the features that will enable you to truly get ahead in the world of commerce. Highly-experienced developers are required in order to implement and maintain a Magento website, and this level of expertise comes at a price. Basically, if you were buying a car and wondering why a Bentley is so expensive, you will learn that it is due to the high performance and advanced features of the vehicle. If you want the best, you will have to be prepared to pay for the best. It is that simple.
What Will I Pay per Hour for Magento Website Development?
A Magento developer who will be able to help you get the very best out of your website will cost in the region of $65 to $150 per hour. The different price range is due to the varying levels of experience of developers. A Junior Developer will be perfectly competent and highly-trained but may not offer quite the level of service as someone who has been in the game for a number of years.
What Will Be the Total Cost per Month for a Magento Website?
There is no simple answer to this question, but if you factor in all the potential costs spoken about during this article, you can get a reasonable idea of what the ongoing costs will be once your website has been built. When thinking about your expected annual revenue, you will need to consider these and decide if you will likely make enough of a profit. However, with a Magento site, you can ensure that you will be among the leading competitors in the eCommerce market, and if you make the best use of all the features Magento offers, you will see the rewards.
What Does Web Hosting Cost Through Magento?
The Magento hosting cost can be anything between $10-50 per month depending on several factors, including storage, website features, and performance capabilities. Unless you are using Magento Commerce Cloud, you may need to purchase a significant amount of extra storage so that your website can run most effectively. However, as always, this will depend on your specific requirements.
Look at the Numbers
| Magento Open Source | Magento Commerce and Magento Commerce Cloud | |
|---|---|---|
| Website monitoring and audit | $4,500/year | $5,500/year |
| Magento update and security patch installation | $1,000+/year | $1,000+/year |
| Extensions update | $500+/year | $500+/year |
| Migration and replatforming | $8,000+ | $15,000+ |
| Magento performance optimization | $1,500+/year | $1,500+/year |
| New features development | $4,000+/year | $6,500+/year |
| Urgent support for Magento | $1,750+/year | $1,750+/year |
| Bug fixing | $1,000+/year | $1,000+/year |
| Total Magento cost for support and maintenance services | $22,250+/year | $32,750+/year |
A Summary
Magento has several different versions to choose from; which one will work best for you depends entirely on the scale of your operations and the level of outside support you require. Above all, you will get out what you put in, and nothing Magento wants you to spend is for the sake of it; the reward for any outlay can be huge.
