The ROI of Usability

Usability and investments are alike in the sense you get what you give. Very few design projects have an unlimited budget, so resources have to be distributed based on priority. Prioritizing usability over other design layers ultimately results in greater returns. Additionally, usability returns are multifaceted. Where other layers have the potential to affect revenue, expenses, or awareness, usability impacts all three.

Increase conversion rates

The most significant usability return is improved conversion rates. A conversion rate is defined as the percentage of total users that perform a desired action. A site designed to generate leads has a conversion when someone contacts the company. An e-commerce site has a conversion when a users makes a purchase.

Increasing the number of conversions is highly desirable but not easy. You could double conversions by doubling traffic to the site, but traffic is expensive (in time and money). A better option is to improve the percentage of people who convert, which is typically accomplished by addressing usability.

• 88% of online shoppers indicated website usability was a key factor in deciding if they would be a repeat customer. (Akamai Study, 2009)
• 48% of online shoppers fail to purchase due to usability roadblocks.
• Lead generation sites can double their conversion rates by improving site usability.
• Improving the usability of a corporate intranet has the potential to save millions of dollars in productivity loss.

According to a Return on Investment (ROI) survey done by the Neilsen Norman Group, spending 10% of your design budget on usability increases conversion rates, on average, by 83%. The report speculates you could double conversion rates while spending less than 15% of the total budget on usability.

In one case, usability expert Jared Spool found that simply renaming a button resulted in a $300,000,000 increase in yearly revenue. Jared called this The Three-Hundred-Million Button. Before implementing the new design, users were required to register for an account before paying for items purchased. It turns out many users felt “registering” was too cumbersome and abandoned their cart. Sales dramatically increased when the button was renamed from “register” to “continue.” The same information was requested, it was just perceived by most users as “easier” and less dis-jointing to their shopping experience.

Usability solutions are not always as simple as changing button labels. Many websites have overarching problems like poor organization. Forrester Research estimates approximately 50% of potential sales are lost because users can’t find information they need to make a purchase (Forrester Research, 2002). Use good planning, clear navigation, and an “obvious mindset”, and you can capture some of that lost 50%.

In business, revenue is always a hot topic, which is why it’s a focal point of ROI discussions. Decreasing expenses, although less “sexy”, can be equally beneficial.

Lower expenses

Usability can decrease expenses just like it can increase revenue. A case study by Foraker Design details the redesign of BreastCancer.org’s discussion forum. The old design was confusing and users frequently called the organization seeking support for common tasks like registration, posting, and password retrieval. Foraker’s redesign made those tasks obvious, which in turn allowed the organization to operate with fewer staff. Specifically, BreastCancer.org was able to reduce call center costs from the original $932 a month, to $293 — a factor of 69%.

An unappreciated benefit of usability is reduction in maintenance expenditures. Because usability issues impact business goals, there is money to be gained in fixing them (more than the cost to fix them). Addressing the issues after building the site is significantly more expensive than addressing them during initial design. Fixing the same problem post-launch can cost 100 times more (Mayhew & Bias, 1994).

Usability can affect the bottom line indirectly as well. If a user purchases despite a bad experience, they still have a negative impression. This could in turn lead to complaints, bad reviews, or a recommendation to shop elsewhere. Bad experiences also impact the brand perception of the goods and services sold. How good can your products be if your website is not well designed?

Solid usability will have users raving about your site and services. Why spend money on marketing when word-of-mouth is free and vastly more effective?

Improve perception and reach

In addition to conversion and expenses, a site’s usability alters how users perceive the associated brand. Unusable websites create negative associations with a brand; a usable design creates a positive association. Furthermore, struggling users will not visit many pages or stay long on the ones they visit. If content isn’t consumed–why have it online?

An estimated 30% of customer loyalty is a direct result of usability (based on correlations between Net Promoter Scores and scores from the System Usability Scale. Positive experiences lead to loyal customers, online and offline. Loyal customers become repeat buyers, advocates, and spokespeople.

You only reap the benefits of a usable site after you understand the user. This is more difficult than it sounds. A common misconception is the user is like you, meaning you intrinsically understand them. In reality, they are not the slightest bit like you.

Great experiences increase profits

Ultimately, usability is a primary factor in site success or failure. Websites are created for people. How they want to use them is critical. Users don’t have the patience, motivation, or environment to figure out a confusing website. Why should they? If your site isn’t easy to understand there are dozens of others that are.

Usability is not just about the greater good of the web. The practice has a direct and measurable relationship to the success of your business. It improves user satisfaction and has monetary benefits (reduced costs, increased revenue, etc.). Remember, when the user wins, everyone wins.