Why UX Matters: Turning Better Design Into Measurable Business Growth

UX Design is mistakenly seen as something that just makes websites pretty or even fancy looking. However, its true power lies on the impact it can have on the business. UX can be a driver of measurable outcomes and financial results, as it directly affects revenue, conversion and overall churn.

Each screen is an interface between the user and the business’ goals, in fact, every screen is an opportunity to maximize KPIs (Key Performance Indicators) and key results. But what are some of the metrics that designers usually work with?

The Metrics

Here is going to be displayed some key indicators on whether the design/digital product is being successful or not in achieving its goals.

Conversion Rate

Probably the most important metric to be considered. Conversion means to measure whether the design is encouraging users to take a specific action. This action can be anything from product purchase to newsletter subscription. Therefore, it directly affects business revenue. It might indicate that a Call-to-Action is not performing as intended, or even that a form is not clear. A well-thought-out redesign can significantly impact the website's conversion rate and increase revenue north of 10%.

Retention Rate and Churn

Both of these metrics represent the same thing, but from different perspectives. They represent how many users are staying engaged and using the app, and how many are stopping/cancelling their subscription. Retention Rate is the former, it focuses on user loyalty and product stickiness. Churn is the latter, it focuses on how many users were lost during a period of time. As a matter of fact, high churn may signal there is some kind of UX issue, such as poor onboarding design and confusing features.

CSAT and NPS

Lots of letters thrown out, but it is quite simple and easy. They represent overall user satisfaction and are measured with survey-like methods, rather than pure statistics. Customer Satisfaction Score (CSAT) represents how satisfied the users are with the product, specific feature, onboarding or anything related. Usually with answers ranging from a scale of one to five. CSAT helps to understand short-term and specific pain points. Net Promoter Score (NPS) measure how willing the users would recommend the product to others, which can be translated into long-term brand loyalty and perception. It separates users in three categories–promoters (with very high satisfaction score), passives and detractors (unhappy users). NPS is the percentage of promoters minus the percentage of detractors. Higher NPS directly impacts word-of-mouth marketing of the brand, which is paramount to the brand's success.

Support Costs

Not necessarily a design and tech measurement, but a business’ customer support costs can be heavily reduced with a properly crafted website. The amount of help tickets can be lowered by having a clearer website, user flow, user notification, FAQs section, hints and many more design tools.

The UX Approach

Now that you learned what are some of the metrics that can be tracked when working with websites and applications, it is needed how UX can work on that.

Every design is a hypothesis. Designers create an interface or feature with the intent of solving an issue. Nevertheless, it is not possible to be sure that the intended outcome will actually happen. That is where the metrics come in, they inform the stakeholders and designers how the design is actually performing. In fact, the work of UX Designers is never-ending, as it is an eternal loop of iterations, testing, learning and creating new elements. Here are some tools used in this cyclical process:

A/B Testing

It is to test the users’ preference between two different designs with the same goal. The difference between design A and design B can either be minimal, such as a CTA button copy, or major layout distribution and user flow difference in a feature. The objective is to understand how an interface really performs with users and if there is an actual improvement in the metrics, as A/B testing usually compares the current live website design with the potential new redesign. It can also be used to compare two new design ideas.

Heatmaps

It showcases how users behave while using the website. It can inform stakeholders to many different and important circumstances, such as, where are users clicking, hovering, how much they are scrolling, what are they interacting with, how are they navigating through different pages and what are the real attention-grabbing points in the design. As a matter of fact, it displays the website interface and on top of that, some "heat” concentrations or user interaction focus points, usually represented in a scale of blue (no interaction) to red (lots of interactions). A very useful tool to understand if the design prioritization and hierarchy is actually working as intended.

Funnel Tracking

It is the analysis of user behavior on the website, specifically on a sequence of steps towards a desired goal. This goal is usually some kind of conversion, such as signing up or a purchase. The Funnel showcases how many users drop off during the sequence of steps in order to make the desired action, or in other words, how many actually get to the end of the steps. It can display potential bottlenecks and pain points on specific steps, as it analyzes all steps of this certain flow. The Funnel commonly showcases the percentage of remaining users at each step, so for example, in the homepage all 100% users are present (as it is the initial state of the sequence) and, on the next step, in the product page that percentage drops to 60%.

Conclusion

UX Design is all about reducing friction and increasing satisfaction, as well as conversion. A properly crafted interface can significantly impact conversion rates, retention and brand loyalty. It is a ROI Engine, as it amplifies all aspects that could create return on the investment. A better onboarding and checkout can dramatically shift a product's status and success. In fact, UX Design is a core lever for business performance and optimization, as investing in UX is reducing waste and increasing revenue.