The process is relatively standard among digital product companies: you prepare to launch (or relaunch) the company website and take the time to debate the layout of your homepage. However much of the discussion becomes a subjective argument during which the person with the most power makes the final decision. That’s where it all ends.
Anybody who knows anything about user experience design knows that we need to measure things but for some reason, we never take the time. The reason? The company (or execs) believes we don’t have the time or that the cost is too high. However what if you were to convert the whole subjective debate over a webpage into an objective discussion about the cost of doing business?
This article reframes the subjective conversation of pretty designs into a business discussion about how to extract more dollars from your designs. (Side note: For the purpose of this article I’m going to discuss the design of a company’s homepage, but ultimately it could be any page on your site or mobile app.)
The Point Of The Homepage
Any given landing page, especially a company’s homepage, has an objective. What’s a landing page? Here’s my definition:
A single web page that appears for an individual with directed copy that explains why they should complete a specific task.
Homepages in particular, tend to have a variety of objectives. The three most common objectives are: 1. Get a new visitor to provide personal information, 2. Get a new visitor to click a link, or 3. Get a new visitor to give you money. Why does this page matter so much? Well, a large portion of your external marketing efforts are typically directed at getting people to this page.
In other words: you’re spending time and money to get people to this page, so why not make it the best it can be?
Unfortunately, not all of the visitors to your homepage will take the action you were optimizing for (registration, etc). This is called fall off. For the purpose of this article, I’ll define fall off as:
Those visitors who fail to perform the expected steps in your product marketing funnel.
If pictures of people walking down a board during the on-boarding process and falling off evokes pictures of danger, my apologies. If you remember the computer game Lemmings, think of that! Optimization is fun! It’s just like the game lemmings! Although it’s not very nice to call your customers lemmings, so I’ll leave the metaphor there.
Anyways, decreasing fall off is one of the most important objectives of optimization.
The importance is obvious when you think about it in dollar terms. Let’s say you put in $10,000 into external marketing efforts (personal time or paid marketing) and were able to generate 5,000 new visitors to your site. The objective of your company’s homepage? Converting new visitors into registered customers.
If you were experiencing a 95% fall-off, you would have converted 250 visitors into registered users. Your effective cost per registered user is $40. Let me break out the math quickly:
5,000 new visitors * .05 (5% conversion) = 250 registered customers
$10,000 marketing budget / 250 registered users = $40 per registered customer
Pretty straight-forward. However let’s say that you invested a little time early on decreasing your fall off from 95% down to 92% (an improvement of 3 percent). The result?
5,000 new visitors * .08 (8% conversion) = 400 registered customers
$10,000 marketing budget / 400 registered users = $25 per registered customer
That’s a huge impact! By decreasing your landing page fall off by 3 percent, you were able to to decrease the cost per registered user by 37.5%. For $10,000 you were now able to generate the same results it would have previously cost you $16,000! The benefit of optimization? A cost savings of $6,000!
Obviously my numbers here are hypothetical. If you are launching your company for the first time, investing the time of a team of two people in optimization is not the best use of your time. If your marketing costs are measurable though, there’s a clear way of justifying the investment of the company’s time and money in measuring new designs.
Best of all, framing the conversation around numbers makes it far more objective.
I’m working on a more comprehensive guide on this subject. If you’re interested in following along, sign up for my email newsletter here. I’ll keep your info private and promise not to spam you!