How Good UX Design Can Affect Your ROI

By Pluralsight    |    June 02, 2016

When you set out to work on a project, depending on the scope, it could be months until it’s ready to launch. So how can you make sure you’re setting it up for success? For one, a variety of skill sets need to be covered by your team. Then, the cashflow and business viability of a project should be determined. Finally, with a project’s success, the ability to support its growth needs to be in place.

This is where some companies can fail, according to Fast Company, who cited these as some of the most common startup pitfalls — in addition to ignoring customers, not realizing the competition in the market, and not serving the market need. Then there are the issues of unrealistic goals, badly defined system requirements, and poor communication among customers, developers, and users (as cited by IEEE). The good news is these are all preventable, and today, we’re going to talk about how good user experience (UX) design can help you avoid these issues and ensure your project’s success from start to finish.

Burn Rate: How Much Assumptions Are Costing You

We all know what happens when we assume, but technology companies everywhere do it at an alarmingly expensive rate. Let’s estimate that rate. Using no UX to examine and test an idea, let’s say you have a team of five developers. We’ll estimate $40/hr * 5 developers = $200/hr.

Using this example will help illuminate and bring to life the following facts. Fifteen percent of these projects are abandoned. With the extra 15% work, that ends up costing the company an additional $60,000/yr. Further, IEEE found about 50% of programmers’ time is spent on avoidable rework. That’s a waste of $100/hr or $200,000/yr. If 50% sounds too aggressive of an estimate, even if we take that down to 25%, that’s still $100,000 in wasted development costs. Finally, IEEE’s study concludes the cost of fixing an error to be 100x that of fixing the error before the development of a project. According to the SDS (Strategic Data Consulting) special report, UX Business Impacts and ROI, UX investments made in the conceptual phase reduce development cycles by 33-50%. So what goes into UX that helps us avoid making those errors in the first place?

Design Sprint: How Much It Costs to Test

One process that leverages all the UX tools necessary to deploy a low-risk, high return on investment is Google’s Design Sprint. This methodology creates an Agile framework for teams large and small to define the problem, come up with solutions, and test them in two to five days. It’s a system that was first defined by IDEO and the (Institute of Design) at Stanford.

Since explaining the Google Design Sprint could become its own blog post, I’ll give you the cliffnotes and offer ways to estimate what it might cost your company. The whole process is done in six phases using only two to five full days. In the six phases, you will go from learning about the problem to validating a minimal viable solution with your users. So to calculate the cost, it’d simply be a matter of what you might otherwise spend on two to five days of your team’s time, depending on how you scale the sprint.

If it seems scary to invest all resources on brainstorming for a few days, consider the basic premise and scale the same process to work for your team. Make sure it’s a process that clearly defines the problem, brainstorms solutions, builds a prototype, and finally tests those prototypes. Also, make sure you know which of your users are having the problem you’re trying to solve for. The only people who should have a vote as to whether your prototype is a flip or flop should always be your user, so test your prototype(s) with one to five of these users. Tweak your prototypes based on their feedback during testing, and test again. The goal by the fifth day would be to have an MVP design the developers can begin implementing.

The bottom line is that whether your prototypes were successful or unsuccessful, you’re still able to learn what works best for your users without spending a dime on development. That’s saving you the 100x the cost of a project you might spend if you released something that wasn’t successful. Paper and Post-its are always less expensive than a team of developers.

What UX Could Add to Your Bottom Line

A good user experience is no longer a luxury for higher-end products — it’s what customers have come to expect from every piece of software and application. Gone are the days when software can just do its job — it now needs to do it in a smart way that’s easy to understand. With the UX market maturing and so many applications being developed daily, your application will need to consider UX in order to compete — especially since good, strong UX can make you stand out in a sea of mediocre experiences.

The very simplified explanation of what a UX team does for your company is that they ensure your features will resonate with your users. When you do this, you create experiences for your users that will make them want to share your product with each other. Good user experience has been known to boost customer value perspective. According to the Customer Experience Impact Report from RightNow Technologies, 85% of users state they would pay up to 25% more for a superior experience.

Companies have tapped into this theory using a tool called the NPS, or Net Promoter Score. This one-question survey simply asks your user, “How likely would you be to refer someone to this product?” and gives him/her the option of answering on a scale from 1 (not likely) to 10 (highly likely). Monitoring your NPS can keep your company’s ear to the ground and ensure you’re striking a positive chord with your customers. That said, I see NPS as a direct insight into how the user experience can be measured. Increasing NPS can lower churn rates and create growth in operational income, as well as increase purchasing among users, profit, and your company’s market share.

UX Is a Tool

With the right UX team and processes in place, you can lower development costs, create built-in channels of risk assessment, and rule out many of the problems and obstacles startups and software companies deal with daily. User experience design may not be the silver bullet to achieving project success, but mathematically and statistically speaking, you’re far more likely to succeed with it than without it.

About the author

Pluralsight is the technology skills platform. We enable individuals and teams to grow their skills, accelerate their careers and create the future.