UX is more than just a design element; it’s becoming a growth driver. Merel van der Lei, CEO and CPO at Wyzetalk, made a powerful case at SaaSiest Amsterdam that aligning user-centric design with business objectives can directly increase revenue. Companies that put users at the center of their strategy are reaping significant financial rewards, suggesting that prioritizing UX may be a game-changer for sustainable growth.
Let’s explore how UX can become a revenue-driving machine, with strategies to boost functionality and budget-friendly ways to maximize impact.
The Revenue-Boosting Power of UX
Van der Lei cites impressive statistics to illustrate the correlation between UX improvements and revenue growth. For instance, Intercom revamped its workflow efficiency and interface customization, resulting in a 42% increase in enterprise revenue within just 12 months. Similarly, Figma focused on real-time collaboration and saw a staggering 240% increase in paid user growth. These examples underscore that better UX isn’t just a theoretical benefit, it’s a proven pathway to higher revenues.
The Investment Breakdown
SaaS companies typically allocate 20-30% of their revenue to product development. This budget breakdown often includes:
- 50% for development
- 18% for product management
- 12% for UX/UI
- 20% for product maintenance
For established products with a strong market fit, this investment is reasonable. However, companies experiencing high growth or requiring a redesign must increase their UX spending temporarily to stay competitive.
The myth of the perfect product
The pursuit of a “perfect product” is a common UX ambition, yet it’s an ideal that doesn’t truly exist. As Merel van der Lei notes, “Our job as UX is to find what works consistently for many, not just the few.” This approach shifts the focus toward universal solutions that align with diverse user needs, aiming to maximize both user satisfaction and business impact. Great UX, then, isn’t about perfection but about delivering meaningful, repeatable value across a broad audience, creating a more accessible and resonant experience.
How UX drives revenue
The impact of great UX on revenue manifests in several key ways:
- Higher Conversions: By simplifying the customer journey, businesses can facilitate more purchases and interactions.
- User Retention: Satisfied users tend to stay longer, reducing churn rates significantly.
- User-Based Growth: Happy users not only engage more but also recommend the product to others.
- Decreased Support Needs: A well-designed interface can lead to fewer support tickets. Van der Lei cites an example where removing a single step and adjusting copy resulted in a 70% decrease in support requests.
The value proposition
To effectively communicate the value of UX, companies must ask critical questions:
- Is your buyer your user?
To effectively communicate the value of UX, it’s crucial to identify who your buyer is. Are they also the end user? Understanding this relationship shapes product development and marketing strategies.
- What’s the value for your users?
Next, delve into the needs of your users. The focus should always be on delivering genuine value. Understanding what users truly want from your product is essential for crafting an effective UX.
- Do you create revenue from seats or users?
Consider your revenue model, whether it’s subscription-based or a one-time fee. This decision significantly influences your UX strategy and the metrics to track for success. Ultimately, the core question remains: what value does your product bring to your users, and what’s in it for them? Addressing this is key to creating an impactful user experience.
Understanding user behavior
The context in user experience is everything. Different users interact with products in varied ways depending on their frequency of use. For instance, daily users require less onboarding compared to infrequent users. Here are a few key considerations:
- User Frequency: Daily users need intuitive systems that they can navigate easily, while occasional users benefit from guided instructions.
- Purpose and Environment: Consider whether users are stationary or on the move, as this affects their interaction with the product.
In this way, UX professionals act like “curling parents,” smoothing the path for users and minimizing friction throughout their journey.
Best practices for driving revenue through UX
Van der Lei outlines several best practices to enhance UX and drive revenue:
- Simplified Navigation: Reduces friction and aids users in finding what they need.
- Personalized Experiences: Increases engagement and customer satisfaction.
- Mobile Optimization: Essential for capturing traffic in today’s mobile-first world.
- Streamlined Onboarding: Helps users get started quickly and easily.
- Workflow Efficiency: Vital for both business users and consumers.
Additionally, she notes the importance of clear and compelling CTAs, as even the color of a button can influence user behavior. Aesthetics play a role but should never overshadow the functional value provided by a user-centric design.
Designing for diverse audiences
When designing for different age groups, it’s essential to recognize their unique preferences:
- Younger Users: Tend to favor fast-paced, socially integrated features.
- Older Users: Often prefer simplicity, larger interfaces, and step-by-step navigation.
Van der Lei stresses that understanding your audience’s literacy levels is crucial, especially for frontline workers who may require clear visual cues and simplified information flows.
Cost-effective UX strategies
While larger companies may invest heavily in UX research, smaller organizations can adopt practical approaches to achieve quality UX without overspending. Here are some actionable strategies:
- Utilize design systems: Create reusable components to streamline the design process.
- Use templates: Especially effective in HR tech for maintaining consistency.
- Learn from others: If a strategy works for another company, it likely has value for you too.
- Implement low-cost prototyping: Test ideas before full-scale implementation.
- Collaborate with developers: Ensure that UX design aligns with technical feasibility for the best outcomes.
Key takeaways
- Impact on revenue: Great UX can significantly influence revenue, sometimes with simple changes like button placement.
- Tailored experience: UX designed for your target audience will enhance their experience and drive growth.
- Cost-effective practices: Employing strategic UX practices can create high-quality experiences without breaking the bank.
With the right UX practices, businesses can achieve more than just a better product—they can transform the user experience into a powerful growth engine. As van der Lei points out, even small UX improvements, like “removing or adding a button,” can make a significant impact on both user satisfaction and the bottom line. So why wait? Start investing in UX, and watch it not only improve your design but elevate your entire business strategy.
