April 6th, 2011

Web Design: How to Measure ROI

Measure site performance to understand your ROI.

When talking to potential clients, one of the questions that we hear a lot is: “What am I really going to get out of a new web site design?”

This question always interests me because, to me, the answer is obvious. You get so many things from your identity (of which Michigan web design is one part) that it’s hard to know where to start. Design affects not only how potential clients will view your company from the outside, but how you and your team will treat your company from the inside. What I have come to suspect this question really means is:

“What is my return on investment for a new design?”

That’s an understandable question to ask. There are many, many things that can be a value to a business. And even if I can prove that a new design would be a benefit, the question becomes: how much benefit? The urge to attach numbers to things, to be truly data-driven, is a powerful one. But how do you do that? Design—art—is all about intangibles right?

It might be simpler if that were the case. But the fact of the matter is that design, as a part of your comprehensive identity, impacts you in a variety of tangible ways. Once we embrace that, we can focus on ways to quantify that impact. That way, we can demonstrate to our clients, for our benefit and theirs, exactly how your site design can go to work for you.

Step 1: Gather data on the old site design before you launch the new one.

This first step is a crucial one if you really want to get an accurate sense of how you have measurably improved user experience. If you are going to do any kind of A/B testing you need an “A”. In many cases (certainly in the small-business world 0f 2011), clients are still trying to bring their sites out of the dark ages (circa 2000). As a part of that, they may not have had any kind of analytics at all in the past or the analytics tools with which they were provided (and can now share with you) may be crude and insufficient for your purposes.

If you are lucky enough to have a client whose previous web-master was competent enough to install Google Analyics, congratulations! You are already a big step ahead of the game. If this isn’t the case, don’t panic.

The redesign process can be an involved one. Depending on the scope of the project, you may have anywhere from 2-4 months from the start of the project (even a simple one) until the actual launch date. That leaves plenty of time to get some data on the old site, but you have to be on top of the ball. Inquire about analytics FIRST THING. The ink on your development contract should not be dry before you are having this conversation. You have to get access to the old site anyways to redeploy and back up the old site files. So why not get that right off the bat? And if the analytics aren’t there, install them on DAY ONE.

Even if you only get a month or two to compare against, it’s far better than nothing.

Step 2: OK, I got some data; now what am I looking for again?

After the new site launch, give the analytics a month or two to compile some new numbers. If you only got a month beforehand, get a month after. If you got two months, give it two months. Larger data sets eliminate the distortions of peaks and valleys. Then, right on the dashboard of your analytics, you can check out the following key stats:


You want to focus on these numbers because they don’t deal with absolute traffic volumes. They give you feedback on what the visitors did who were already reaching your site.

Bounce Rate

Bounce rate tells you if people continued on into the site after viewing the page on which they landed. You’ll want to give some careful consideration to how your changes might affect this number. If you load the one piece of content that most visitors are looking for onto the homepage (ie. contact information or an important video piece) you may see this number rise (that’s a bad thing) while still accomplishing your goal. In most cases however, a good design will lead to a better first impression, and a better first impression means visitors will feel more comfortable staying to look around for a while.

Average Number of Pages Visited

In the same vein as the above, number of pages visited tells you how well the site appealed to visitors once they got there. Compelling content is also a key factor in improving this stat. Content creation goes hand in hand with quality web design if your end goal is an incredible user experience. An incredible design won’t save you if your site content is something that nobody wants.

Average Time on the Site

Average time on the site can be a great way to adjust for sites that might naturally have a higher bounce rate. Perhaps your bounce rate goes up, but so does the average time that a visitor spent on the site. This is key if blog posts or video are a main attraction on your site. Visitors have to take time to watch a video or read a blog post. These visits might still count as bounces, even though they accomplished their goal.

A new Michigan website design won’t necessarily bring new traffic immediately. But you can expect to see a measurable improvement in the traffic that you were already getting. You just have to know where to look and not be afraid to.

Step 3: Calculating Value

So now you have some numbers in front of you. You know how your bounce rate improved and you know what your traffic levels are. You can concretely measure individual visits saved. How much is each visit worth? Google can tell you.

Using the tools Google Adwords provides, you can get an excellent sense of what a click is worth to your client.  The Keyword Research Tool will allow you to derive a list of keywords from any domain you input. Simply punch in your client’s url and grab the list of keywords that are generated. (You can always dump this data out into spreadsheets if that helps).

The Keyword Estimator tool (just another face of the Keyword Research Tool) will give you an excellent sense of what each of these keywords is worth on a per-click basis. The great thing about Adwords is that the value of a click is set daily by auction—by peers in your client’s field competing for those clicks. The value that Adwords places on a click really does equate to what that click is worth to your client’s industry.

The rest is simple arithmetic:

(Old Bouce Rate) – (New Bounce Rate) = (Difference in Bounce Rate)

(Difference In Bounce Rate) x (Monthly Absolute Unique Visitors) = (Monthly Visits Saved)

(Monthly Visits Saved) x (Average CPC) = (ROI)

If you’ve done other work for the client that may have increased absolute traffic to the site (on-site SEO, Social Media, or Link Building) this formula can be adapted to show ROI for those efforts as well. What’s amazing about this is how quickly it ads up. If you decreased your client’s bounce rate by even 5-10% (depending on your client’s traffic volumes) you could be looking at an investment that is paying for itself within a matter of months without taking into account the intangible benefits of the redesign.

Now that’s measurable ROI for Michigan web design.

A note of caution:

There are certainly mitigating factors to be taken into account whenever you are looking at live data. (Remember the length of months, the patterns of weekly traffic, and the peaks or valleys of holidays.) The plan outlined above is not as controlled as strict A/B testing, but it still holds merit for those of us that need to illustrate ROI to clients when there isn’t a huge budget sitting around for R&D work. Because that is the case, a healthy dose of prudence is still a good idea in many cases. Always bear in mind who your client is, where you can reasonably expect to take them, and don’t over-promise.

The above method works the best when you have an opportunity to substantially improve a design on a site that gets enough traffic that a realistically improved percentage is going to add up. Nevertheless, use these ideas as a springboard for identifying where you are providing a real, tangible benefit to your clients. And when you do deliver that demonstrable return, don’t be afraid to flaunt it.

You’ve earned it.

If you have your own success stories or know some techniques that have worked well for you, we’d love to hear about them.

Related Articles