On July 28th, we invited UX specialist David Juhlin to talk about the 5 levels of UX strategy. David shared his perspectives on aligning UX and business goals by considering the global, industry, company, division, and project levels.
One key distinction that arose in the discussion was between the leader strategy and the follower strategy. In other words, should your company try to push the envelope and provide the best, most innovative UX? Or should it try to adopt the proven best practices and play it safe, keeping pace with competitors?
The following is a transcript of the live Q&A session that followed David’s talk, touching on topics including both strategies and all of the 5 levels of UX strategy.
Q: What metrics should a business use to measure their UX strategy after recognizing what level their company operates at?
David: A company should consider UX on all levels. Some companies have not “gotten there” yet, so they might only be working, for example, within the project level. Companies like this need to grow and scale first and then measure their UX strategy.
A company might draft 3 different UX strategies, compare them to each other, and execute only one of them. But if you already have a strategy in place, how do you make sure you make progress on that strategy? How do you make sure that you push the needle forward? Those answers, I think, are more valuable.
There are a few things to consider on all levels, and there are a few things to consider on specific levels.
One thing that spans across all levels is to benchmark progress. It is important to establish benchmarks on multiple levels, as well as against competitors – and you need a standardized way to measure them. To be honest, so far, we have not seen many robust standardized metrics.
You have AttrakDiff, that’s trying to measure some of the user experience, you have the Net Promoter Score (NPS) that focuses on measuring the entire company and how likely it is to be recommended, and you have the System Usability Scale (SUS). However, I do not think we have one really good measurement yet. Basically, you need to come up with your own benchmark, your own score, to use.
You can do that by deconstructing what good UX means for your industry.
Does it mean a pleasurable experience? Is it a desire for customers to do business with you again? For Disney, for example, it might be about memories. Meanwhile for a bank, it may be about trust. but you need to deconstruct what it actually means.
So that’s just a general take. If we look at a global level, you can benchmark your industry compared to other industries and see how your industry is moving forward (or not). Just keep in mind that you don’t have that much impact on the industry in general. If you push UX harder, most likely your competitors are going to mimic you, so you may push it a bit but you don’t have ultimate control over the industry.
Next you go down to the industry level and look at the different companies that are operating there – your competitors. If you’re using the “follower strategy”, for example, are your UX scores close to the best ones? And compared to other companies that are taking this follower approach, are you beating them? And how do you compare over time?
You also need to consider how much you are spending on UX. Because if you are taking a follower strategy you should be trying to spend less. If you are a leader on the other hand, you need to see if you have the best UX and if customers are willing to pay for it.
At the company level, are you moving towards the structural arrangement that you aimed for? Are you moving the needle in the right direction? If you are trying to push innovation, for example, have the UX division generate 3 different innovative projects. Then see, do these projects lead to any revenue once they get launched? And how many projects has the division been able to participate in? So you have all of these different levels.
Q: When you look at the overarching business strategy, when is it safe to overlook UX?
David: I think it is never safe to overlook user experience, but I think it can be down-prioritized. I think you should always look at it even if only to understand where you stand, what business you’re in, what industry and so on; but I would never just completely let it go.
A few times, you may be able to downplay it: when your industry is far from creating experiences, for example, and price is the primary driver. Say you’re dealing with commodities. Price is the primary factor, and not the user experience as much. Keep in mind when I say these things, you still need to have decent customer service. The representatives selling and talking to the buyer need to deliver good service, but you may not need to invest as much.
There is also another case, when you have limited competition: for example, you have patents and usage rights, or it can also be government regulations – say, utilities companies – and what’s more important for these kind of agencies is that the usability is good, because they don’t want all the customer support calls. But it doesn’t need to be this delightful, awesome user experience, so they may be able to down-prioritize that.
Also, as I said before if you have a smaller budget I wouldn’t say you can completely ignore UX, but you need to think wisely about how you spend your UX budget.
Q: How can UX strategy boost company’s sales?
David: I think the easiest way to think about this is from an economist’s perspective. Let’s say you’re creating a product, and it costs $10 to create.
Then the next thing you try to figure out is how much can you charge for this? What do customers value this product at? Let’s suppose on average it’s $100, and some are going to be willing to pay $110, and some will only pay $90, but you have an average.
So $100 is what people value it at. That doesn’t mean that i think you should price it at $100, because you’re now creating a value gap between the cost of creation and the actual value. If you for example price it at $90 or even $80, the user actually gets more value. You’re taking away from the business margins – and that’s going to be a fight with the accountant – but you actually have reasons for doing this.
For the customer who is buying this, it’s less risk! Because it’s cheaper to buy. And the product is going to over-deliver value, because they actually value it at $100 and you’re only selling it for $80. You gave them a value of $20. That means they’re going to do word-of-mouth marketing for you, and you’re going to see more rapid growth. So sometimes, it’s actually better to price something lower.
Pricing affects how the brand is perceived. And if I tie this back to UX, a great user experience actually gives more value to the user in the end, and that’s why it’s actually a really good strategy for a company to focus on. In the end, the UX creates a higher value perception of the product.
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Q: Should UX be a key differentiator on all levels, or is it more relevant at specific levels?
David: I don’t know if I would use the word differentiator. The goal should be a clear purpose at each level. Every subsequent level needs to support that purpose, and the processes that you build need to tie into a chain that’s supporting the overarching strategy.
So for example, if you’re aiming to be the UX leader in your industry, you will be differentiating a lot. But that also means that the processes further down, on the company level, at the division and product levels, those internal processes need to be better than your competitors who are also aiming to be the industry leader.
I also want to get this message across: I talk a lot about the leader strategy and the follower strategy, and in most industries it is still beneficial to aim to be a UX leader and not just trying to be a follower. It is still advisable to take on that role.