Design not only needs to make a visual impact, but an impact on your bottom line, too.
If you’re just spending money on design, and have no idea whether it’s actually performing well, you very well could be wasting money.
However, it’s also very possible that the investment you’re making in design is positively impacting your revenue.
Analyzing this can be referred to as design ROI (return on investment) — an assessment on the impact that design improvements are making on your business’ financial performance.
The idea is to help you understand if the design decisions you’re making are contributing to your profitability (or not).
The question here is — are you turning design into dollars?
Let’s take a look at how you can analyze conversion rates as one method for measuring design ROI.
Reviewing Conversion Rates
In our first method of tracking design ROI, we’ll talk about conversion rates — this is a way of measuring the percentage of an action you wish a user to take on your website.
This action could be filling out a contact form, clicking a particular button, buying a product, or anything similar.
It must be a specific action, however, that you can measure the results.
Let’s say you design a totally new page hero design for your website homepage, with the goal of getting users to click your main call-to-action for signing up for your newsletter.
Prior to your redesign, you may be getting only a 2% conversion rate — meaning, for every 100 people that landed on your website homepage, only 2 of them signed up for your newsletter.
So now you launch your new redesigned page hero, with an improved headline, and stronger call-to-action, paired with an intriguing graphic or image.
In the first 7 days after the redesign, you see an increase of subscribers — in fact, it’s converting now at a 8% rate. That’s 4X what your conversion rate was prior.
So 6 more subscribers per 100, and if you get 1000 visitors to your website a week, that’s 60 more a week, and more than 240 a month.
If your newsletter is an avenue for helping drive sales and revenue, you can then evaluate the cost of redesigning the page hero and decide — was the investment worth the 6% increase in subscribers? And therefore, lead those into your sales funnel?
More than likely, you’ll say yes.
I know this can be slightly objective, depending how much you paid for the design, and how much a subscriber is worth.
But generally speaking, the increase in your conversion rates sounds like a success for your design ROI.
You can get even more granular, and evaluate what percentage of your subscribers end up being a paid customer, and calculate that against your new growth.
So if you had a 4% conversion on turning subscribers into a customer, and an average sale was, say $100, you are getting roughly 250 new subscribers a month, which equates to 10 new customers.
On average, those customers spend $100/each, which brings you in $1000 extra revenue — just from redesigning your page hero with a more compelling action to sign up.
Now, unless you completely overpaid on design, $1000 will most definitely bring you a positive design ROI.
You can continue to evaluate these conversion rates, and if things seem to be dropping off, re-invest in design.
Coming up, I’ll talk about more ways we can measure your design ROI so that you can keep your website running as a successful lead-generating machine.
See you next time,
