Why successful companies invest in UX during downturns

To remain competitive, companies should invest in UX rather than cutting it to reduce costs

Intentional user experience (UX) research, design and development is a regular causality of project cost cutting, but successful companies avoid doing this and rather make an investment in UX.

Companies that cut UX investment in economic downturns are short-sighted, and put themselves at risk. But UX isn’t a ”luxury.” It’s a necessity. In this article we will talk about why UX is worth investing in, even during hard times.

Why companies tend to cut UX budgets from projects (or, why companies don’t invest in UX)

There may be multiple, complex reasons for companies to stop investing in UX, from budget tightening and resources constraints to layoffs. The main reasons why companies pause or stop investing in UX usually boils down to two issues:

  1. Hard to measure the return-on-investment (ROI)
    Measuring ROI for a business requires proper tracking and time:
  • Identifying issues
  • Making design changes
  • Developing and deploying changes
  • Measuring success
  1. Internal resource limitations.
    The internal team may not be able to make changes, even if they want to. This may be due to company politics, not having a UX team in place, or not having the resources or knowledge in order to make changes on their own.

Why shouldn’t you cut the UX budget?

UX is often misunderstood as visual, whether that be the look and feel of website, platform, or a product. While aesthetics are part of UX, UX designers focus on the entire experienced with the product. This includes putting the user at ease, helping them complete a task, and even delighting them so they enjoy using the product.

During the UX design process, designers build trust by improving satisfaction and reducing friction for the user while they complete a task.

Positive experiences benefit more than users. A strong UX design process could lead to happier employees and happier bottom lines.

Reduce rework

How much time and money is lost when a designer is not part of the process? A lot.

Designers can help ensure that what’s actually developed is closer to what the users actually need.

It is estimated that 50 percent of a programmer’s time during a project is spent on rework that could be avoided.

By employing UX early in the life of the project (from the start until development handoff), you can clearly define what usability requirements and features are up-front and avoid unnecessary rework, for all parties involved.

Reduce scope creep

Widely known as scope creep, correcting a problem or requirement increases over a project lifecycle. We can also see this in the 1:10:100 rule. Correcting a problem at the development stage is 10 times more expensive than fixing the same problem during the UX design phase. It is 100 times more expensive to fix after deployment.

So, why not implement UX from the get-go?

1-10-100 rule

Get requirements right

Of the top 12 reasons that projects fail (defined by IEEE), three are directly related to user experience or user-centered design work. They are

  1. badly defined requirements
  2. poor communication among customers, developers, and users, and
  3. stakeholder politics.

We can break down a little bit more into some common mistakes that happen without proper UX work:

  • Incorrect assumptions about user behavior
  • Features that confuse or frustrate the users
  • Navigations that end up your users stuck or lost
  • Design choices made without any user guidance
  • New features that do not solve current user problems

common mistakes without UX

These common problems can be solved before the development phase if the product team can go through a proper UX design phase, identify actual user problems through research and communicate with developers early on. Including developers and product managers during the design phase ensures that design decisions and ideas are validated up-front, and will also help with performance bottlenecks with prototyping.

Polsource mentions the following as other measurements can be improved by UX investment:

  • Decreased development time/cost
  • Decreased maintenance cost
  • Decreased support costs
  • Decreased documentation cost
  • Decreased user training time
  • Decreased time to proficiency
  • Decreased user error reports
  • Decreased handle times
  • Increased self service
  • Increased customer satisfaction scores
  • Increased customer retention
  • Increased customer retention

Improved measurments when companies invest in UX

In general, UX investments more than pay for themselves by providing a unified project direction. If you want to a rundown of how the ROI of user experience works, we recommend you watch this video by Dr. Weinschenk. For more detailed information on ROI, take a look at the calculators from the Human Factors Institute.

What can companies do?

  1. Invest in your product/UX teams
    Don’t freeze hiring or cut out employees from your product teams. Diminishing needed talent or resources will not do your company or your product any favor.  It’s easy for marketing or sales teams to unfairly win the debate because they tend to have immediate ROIs, compared to product teams.

If your company still needs to cut budget, or can not invest in an entirely new product / UX team, make sure to use external help. This includes using consultants, freelancers, advisors, or outsourcing UX work to an agency.

While it is more common to find agencies that include UX among many other marketing and advertising options, there are clear benefits to outsourcing to a specialized UX agency.  In addition to expertise that may be lacking in agencies that provide all services, it’s easier for UX agencies to be a partner for companies and provide clear answers for questions about users.

  1. Focus on core user experience to stop losing users
    Teams should focus on the first-time user experience as well as current and future experiences. While it’s important to focus on pouring more users into the funnel (which is where marketing comes in), a good user experience turns those users to returning users. Companies need to go through their own product (ideally through usability research) and identify steps at which users take long pauses, fumble around, or get confused. This means they are going through a high cognitive load. Reducing user frictions like this can aid in customer retention, which translates into increased revenue.

Let’s take an example used by Peter Ramsey in his pitch deck. Imagine that after clicking on a Facebook ad, only 20 percent of your users return daily. You’ve lost 80 percent of potential users in between.

Identifying user frictions and making small improvements throughout can cause meaningful impact. It’s possible to raise the percentage of retained users through to the next process. If successfully done, you should see an overall improvement in the percentage of users who return daily. UX design makes it possible to focus on each user stage independently.

Sales and marketing can pour more people into the funnel at the beginning, but unless you fix your leaky funnel, you will only create more waste.

  1. Tidy up issues that are wrong today
    Rather than focusing on releasing new features, companies should focus on cleaning up on the small (or large) issues that the product faces at the moment. Fixing existing issues has a higher impact on keeping current users. New features means higher development and maintenance costs, which could lead to technical debt during hard times.

Let your developers and programmers focus on rework through the UX design process to save time and money later!