How improving the user experience can help you improve KPIs
Successful organizations measure and track results, and organizations that invest in a better user experience are twice as likely to consistently achieve their business goals.
Improving the user experience can improve key metrics and help you reach your year-end targets. In fact, user experience design can have a high return on investment: for every $1 spent on UX, companies can see a return of between $2 and $100.
Here are some examples of how improving the UX of your products and services can impact your key performance indicators and help you reach your business goals.
Improve customer acquisition
Understanding the cost of acquiring a new customer is critical for most organizations. According to Hubspot, customer acquisition cost (CAC) is the total cost of sales and marketing (as well as overhead) associated with attracting new users and converting them into customers.
This cost can be high, depending on the industry. Typically, companies try to reduce this cost as much as possible so they can grow. So the last thing they want is to add issues that can unnecessarily increase CAC.
Unfortunately, a lot can get in the way of a new lead turning into a customer — especially if they land on a website and the experience isn’t ideal.
For example, if a customer is trying to sign up for a product or service, this experience can seal the deal or cause them to abandon the entire process.
The way this process is designed can have a big impact on how customers view your product or service.
Understanding customer frustrations
Every company’s product offering is different. And while there are best practices for how to encourage customers to sign up for your products and services, you don’t know whether it will work or not without understanding their needs and pain points.
This is where UX comes in. User experience designers — like the UX designers at Standard Beagle — get to know the unique groups of people who use a product or service. The decisions in the design — whether to add friction or not, how many steps to include, what messaging to include, and what fields to complete — are all based on the needs and motivations of the user.
UX leader and trainer Jared Spool wrote about one example. He explained how Amazon increased sales by $300 million by changing the text on a button from “Register” to “Continue.” Users didn’t like being forced to register just to complete their purchase. By removing this requirement, Amazon removed a major user frustration and sales increased.
The takeaway on achieving business goals through UX?
Understanding users can have a big impact on your business goals and ultimately the bottom.
A skilled UX design team can help determine if onboarding is needed and the best elements to include.
Cindy Brummer
Customer loyalty and retention
It can cost five times as much to acquire new customers as to keep current customers happy. That’s why many organizations also focus on improving loyalty and retention.
Have you ever downloaded and signed up for an app, only to stop using it within the first week? You are not alone. More than 25 percent of mobile apps are abandoned after just one use.
A well-designed onboarding experience can help. This is when an app guides users through features of the app to help them learn and make them successful. It’s often the first impression a user has of the app, and if it’s done well, it can help ensure that users keep coming back.
A skilled UX design team can help determine if onboarding is needed and the best elements to include. Often it comes down to watching and observing users.
For example, Evernote’s team observed its users and discovered areas that could be improved. The company added intuitive and helpful features, and it saw a 15% increase in user retention.
A UX design team can help avoid the cost of rework by designing a sign up path that fewer users abandon.
Cindy Brummer
Reduce cost of production bugs
Software developers spend up to half of their time fixing issues that could have been avoided in the design process. This cost adds up. Since developers can be an expensive resource, companies often track the efficiency of their teams.
A user experience designer who understands the goals and needs of a user can design a method that works more effectively, so a developer doesn’t spend time trying to fix a broken or non-working process.
For example, let’s go back to our sign up flow example. Let’s imagine no UX design went into designing the flow at all. The sign up may be confusing, so users may start the process and then abandon it.
We’ve seen cases where the user accidentally signs up, and then an entry was made in the database for the user, which causes account problems later on. The development team then spends precious time tracking down the abandoned accounts and removing them, which takes them away from other projects.
A UX design team can help avoid the cost of rework by designing a sign up path that fewer users abandon.
It costs 10 times as much to fix a problem in development as it does in design. And if the issue is already live, it costs 100 times as much.
This is another KPI where UX design can make a big impact.
Design has a business value
McKinsey and Company released a report that found that businesses with strong design grew their revenue nearly twice as fast as their industry peers.
The companies that excelled were high performers in four different areas:
- Driving design from the leadership level
- Putting users first at every level of the company and in every department
- Continually iterating
- Focusing on the user experience strategically — across products (physical and digital) and services
Not every company is ready to take these steps. However, those organizations that move toward valuing design can begin to see a positive impact in their metrics.
Ultimately, focusing on the user experience can help companies achieve their yearly goals and grow.
