In recent memory, there has never been a better time to invest in UX research. The global lockdown due to the ongoing SARS-COV-2 pandemic has vastly increased the importance and potential return-on-investment (ROI) in a few significant ways.
- Major multi-national firms are currently scrambling to standup eCommerce sites. Traditionally business to business (B2B) firms, these organizations are adopting systems to create direct-to-consumer (B2C) sites for their brands. A recent Forbes article by Neil Stern suggests the pandemic has only accelerated eCommerce growth increasing penetration from 3-4% up to 10% [1]. To some extent, this increased penetration will persist after the world returns to normal. While a data aggregator on Statista.com predicts eCommerce revenue growth up to 34% for food and personal care items, and 21% for toys, hobby, and do-it-yourself items up from 18.6% and 15.26%, respectively, last year [2]. As further evidence of this new trend, the stock price of Shopify, a platform designed to standup B2C sites quickly and cheaply, had increased from $416.93 on March 31st (when 32 of 50 U.S. states were on lockdown) to $753.01 (80.61%). Understanding the unique sales propositions brands can make and focus on the usability of these sites will be key to retain and continue to grow eCommerce market penetration.
- Data is only useful if it is current. Even in "normal" times, if the information is a week old, it is out of date. Customer beliefs, attitudes, drives, and behaviors are continually changing. The pandemic has thrown everyone through the looking glass and made every single organizations' data obsolete. The 2020 pandemic is the most significant tragedy to occur on U.S. soil in recent memory. The tragic events of September 11th, 2001, claimed the lives of 2,996 people. As of writing this, 1,552 people today and 93,533 people total have departed in the United States, and the situation is far from over. In addition to this loss, over 20 million Americans have filed for unemployment, increasing the unemployment rate from around just under 4% at the start of 2020 to 14.6% as of March 8th, 2020. For perspective, the 2008 financial crisis unemployment rate peaked at 10.2% in October 2009. Finally, we cannot ignore the detrimental effects wide-spread lockdowns will have on the psychology of customers. To be blunt, the data you collected before the pandemic is garbage. Your customers' financial means and psychology have changed and there is no telling how long these effects will persist. Investing in research to better understand your customers right now is a necessity not an option. Set aside growth and increased market penetration, if your business is not conducting research right now, you are falling behind.
Both UX consulting firms and in-house UX teams often fail to address the ROI of their activities adequately. While calculating ROI can be difficult, there is empirical evidence indicating the value of UX research.
The most prominent studies are a 2006 study by Nielson Norman Group (NNG) that reported an average ROI of 83% for usability, while a more recent study by Forrester research in 2010 suggested personas have an average ROI of 400% [3,4]. An IBM report suggested, for every dollar spent on UX, there was a $10 to $100 [5].
A prominent case-study provided evidence for increases following personas ranging from 100-900% on four specific KPIs; "number of pages visited" 100%, "email open rate" 111%, "marketing generated revenue" 171%, and "length of visit" 900% [6]. While another study provided evidence for increases ranging from 55-210% on five specific KPIs; "organic search traffic" 55%, "opportunities for online marketing" 73%, "online marketing leads" 97%, "leads from all channels combined" 124%, and "website traffic from North America" 210% [7]. Other studies have indicated positive correlations between UX metrics such as the system usability scale (SUS) standardized user percentile rank-questionnaire (SUPRQ), elements of value (EOV), and increases in net promoter scores (NPS) and revenue [8,9,10].
The data is clear, UX research enables businesses to better understand their target audiences, translating to increases in KPIs, leading to ROI. The value of this research has increased exponentially as businesses scramble to standup eCommerce sites and gather current data to make evidence-based decisions.
References:
Stern, Neil. 2020. "E-Commerce And Grocery: This Time It’S Real". Forbes. https://www.forbes.com/sites/neilstern/2020/04/27/e-commerce-and-grocery-this-time-its-real/#1e99c2125d65. [1]
"Ecommerce - Worldwide | Statista Market Forecast". 2020. Statista. https://www.statista.com/outlook/243/100/ecommerce/worldwide#market-globalRevenue. [2]
"Usability ROI Declining, But Still Strong". 2020. Nielsen Norman Group. https://www.nngroup.com/articles/usability-roi-declining-but-still-strong/. [3]
"The ROI Of Personas". 2020. Forrester.Com. https://www.forrester.com/report/The+ROI+Of+Personas/-/E-RES55359. [4]
https://www.uxteam.com/blog/every-dollar-invested-in-ease-of-use-returns-10-to-100-dollars/. [5]
Marketer, Allison. 2020. "But Seriously… Do Buyer Personas Really Lead To Greater ROI?". Precisionmarketinggroup.Com. https://www.precisionmarketinggroup.com/blog/but-seriously-do-buyer-personas-really-lead-to-greater-roi. [6]
"The ROI Of Personas - Mnemonic AI". 2020. Mnemonic AI. https://mnemonic.ai/the-roi-of-personas/. [7]
Affairs, Assistant. 2020. "System Usability Scale (SUS) | Usability.Gov". Usability.Gov. https://www.usability.gov/how-to-and-tools/methods/system-usability-scale.html. [8]
"Measuringu: Why The SUPR-Q Is Better Than The SUS For Websites". 2020. Measuringu.Com. https://measuringu.com/suprq-sus/. [9]
"The 30 Elements Of Consumer Value: A Hierarchy". 2020. Harvard Business Review. https://hbr.org/2016/09/the-elements-of-value. [10]
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