Website Redesign ROI: How to Turn Clicks Into Gains

ROI means “return on investment.” It is a crucial parameter for anything a business does that involves spending money. Website redesign ROI is determined by comparing the money spent on it and the money gained as a result of it. We will spoil the conclusion of this article: a good website redesign has a great ROI. In other words, it is usually worth the money to change up your website. But let’s consider the ways in which website redesign returns your investment. 

Website Redesign ROI: The Calculations

ROI is an actual metric, and you can calculate the ROI of your website redesign. It is done by deducting the costs from the gains and then dividing the result by the costs. The number is usually multiplied by 100 to get a percentage.

For example, you have spent 5,000 USD on your website redesign. Within the following month, your revenue increased by 15%, and you estimate that you gained 8,000 USD as a result. Your calculations would look like this:

(8,000 - 5,000)/5,000*100 = 0.6*100 = 60%

You got an ROI of 60%. That is considered a very good ROI! 

Cost of Website Redesign

As you have noticed, the cost of the redesign is an important part of the ROI equation. Before we consider gains, we need to investigate the investment required.

Website redesign can be cheaper or more expensive depending on your choices. If you decide to do it yourself, you might actually manage a free redesign! Of course, it will require time and may not result in all the features you need. That means it is not exactly free, but you pay no money for it.

If you have a freelance professional or an agency redesign your website, expect to pay anywhere between 800 and 70,000 USD. The cost depends predominantly on the following.

• The size of your website — a bigger website requires more investment.
• The style and features you want — more modern and complicated websites cost more.
• Whether you work with a freelancer or an agency — the latter is usually more expensive.
• Deadlines — shorter deadlines mean paying extra for the urgency.

This is only the upfront cost. Remember that a website requires maintenance and hosting. There may be subscription costs for the tools you used as well. In other words, a website continues to require investment. However, even as it needs money, it also generates profit. Let’s discuss the main mechanisms of that process.

The Mechanisms of Website Redesign ROI

Website redesigns have two obvious effects on earnings: they increase traffic and conversion rates. Keep in mind that there can be additional results. For example, by redesigning the website with accessibility in mind, you can gain the loyalty of users. But loyalty is difficult to quantify, unlike traffic and conversion rates.

Traffic

Traffic is the number of visitors that your website receives. Website redesign can increase traffic through better optimization for search engines. With that, more people will visit your website, and you will get more chances to receive new customers. Increased traffic is a good reason to consider website redesign successful. It is also reasonable to believe that more traffic equals more gains. Although for that, the next metric is more important.

Conversion Rates

Conversion rates are the rates at which your visitors become clients or take another action you want them to. For example, leaving an email may be another goal, which turns visitors into leads rather than customers. This is the main mechanism of website redesign ROI. As more people buy from you, your revenue increases. That determines how your website generates returns on your investment. 

Measuring Website Redesign ROI

It is not easy to calculate website redesign ROI. While there exist mechanisms of directly affecting sales, you need to also remember that there are non-quantifiable effects. A good example is brand awareness. A website that ranks well in search engines undeniably improves the awareness of your brand. However, it is very difficult to quantify the impact of that awareness.

Similarly, it is difficult to claim that an increase in traffic and conversion is the result of website redesign only. Redesigns are known to affect these parameters. However, you are not running an experiment in a lab. There can be any number of causes for increased traffic and conversion. 

That does not mean that website redesign ROI is not worth calculating. Quite the opposite: you should always keep track of the metrics. However, when reporting your ROI or considering it for future projects, keep in mind the limitations of your methodology.

Website Lifespan

Another thing to remember when calculating website redesign ROI is that your website continues to bring profit over time. Each website has a lifespan, and if it is designed well, it can continue bringing gains for years. 

A good lifespan for a website is 5 years. It means that the website does not require major changes during that time. It will still require maintenance, but that initial investment in the redesign will not be needed. That said, redesigns are recommended to be done every few years. Consider not letting your website remain without a redesign for more than 5 years. And when calculating ROI for it, take into account all the gains (as well as all the costs) over the course of the website’s lifespan. 

Website Redesign ROI: Real-Life Examples

Due to the difficulty of quantifying ROI, especially at the beginning of the website’s lifespan, most real-life cases do not focus on it. However, they report other achievements, such as traffic, and we know that traffic can lead to good ROI. Let’s consider a couple of examples.

• Vienna Beef is a food and beverage company that has been around since 1893. Vienna Beef approached Orbit Media to improve its website and redesign it. With a focus on copy and navigation, Orbit Media took on that project. The result, according to Vienna Beef’s Director of Marketing, was a 300% increase in traffic. 
• Another success story reported by Orbit Media is that of Plum Diamonds. The jewelry company management wanted to improve SEO. After investigating the website, Orbit Media focused on restructuring the categories section and adding metadata. This case study reports a 700% increase in sales over the course of six months! 
• Altamira reports the case study of Think Tank Photo, a company selling camera accessories. Their redesign involved making the mobile responsiveness of the website better. It naturally led to a 96% increase in smartphone purchases and a three times revenue growth.
• Altamira also reports the success of Bandwidth, a communications company. Their website had its layout changed and CTA redesigned. It resulted in a 173% conversion rate increase!

As you can see, examples of good website redesign almost always lead to increases in metrics. None of the examples have costs reported, so we will not assume ROIs for them. But these improvements suggest that ROI can be good based on how conversions and traffic affect revenue.

We more than tripled site traffic after our website redesign…

Carrie Bodman, Director of Marketing at Vienna Beef

Is Failure Possible?

A good website redesign has all the chances of producing strong ROI. However, what about bad redesigns? Think of the Yahoo Mail redesigns of 2012 and 2013. Both received a lot of criticism for giving up on features that were useful, for example, the sort-by-sender option. There is no data on how the redesign affected Yahoo Mail, but the users were not happy.

Indeed, you might end up with a bad ROI or even lose money if you don’t redesign properly. Here are a few ideas on how to avoid such an outcome.

• Do not delete the features that your visitors love. You should know which ones matter through the analysis of your existing website.
• Make sure that your website is easy to use. A user experience (UX) specialist can help with that.
• Do not add features that are not useful. A UX designer can help here as well. You can also request feedback from visitors.
• Test your website. Make sure that everything works smoothly.
• If your website redesign ROI is bad, learn from your mistakes and be ready to redesign again.

In Conclusion

In summary, website redesign ROI is likely to be high when the redesign is done well. The costs can vary, but traffic and conversions drive ROI up for the several years that are the website’s lifecycle. It is sometimes difficult to calculate ROI. Some parameters like loyalty or brand awareness cannot be quantified. But ROI is still important to keep track of to make sure that you invest in redesign wisely.