Marketing budgets and your website; Is there a correlation?

I am struck by the number of times the subject of how and where to spend a marketing budget comes up and the company's website doesn't even factor into the conversation. In the last ten years alone, the Yellow Pages phone and business directory has shrunk to less than half of what it was in 2002 (source: http://www.timescolonist.com/technology/Victoria+phonebook+shrinks+half…) and Google searches have risen year after year as shown in the following data.

Google Searches over a ten year period:

1999 (September) -> 3 million a day (Google official history)
2000 (December) -> 100 million a day (Google official history)
2002 -> 150 million searches a day (estimate)
2004 -> 200 million searches a day (IPO figures)
2007 -> 1.2 billion a day (Clickz)
2008 -> 2 billion a day (estimates)

There is no question, more and more people are looking for products and services online. Arguably, having a well designed website with relevant, up-to-date information is becoming a litmus test of a companies legitimacy. If you run a print ad campaign but people can't find you online, this sends an incoherent and possibly damaging message.

I've heard of independants and small business owners spending upwards of 4 thousand dollars on a year's worth of print ads in a single publication, yet they don't have a website, or worse yet, they don't see the value and potential in a website. I'm not trying to be biased toward online media, but this seems counter-intutitive to me.

There are so many opportunities to increase your reach in the online sphere and websites today can be built so that you don't have to do the leg work. A website can be specifically designed to encourage referrals, gather customer information, be updated daily with fresh, new, content, be dynamically synched with your social media channels such as Facebook, Twitter, LinkedIn and YouTube, and provide meaningful reporting tools showing you where your traffic is coming from, how people are searching for you, how long they're staying on your website and track conversion rates.

A well designed website should be at the core of any meaningful marketing strategy.