caitlin gannon

Jacob Nielsen writes in his latest column that eBay’s recent earnings increased because of better usability.

eBay reported record profits for Q1. This despite the fact that the number of auction LISTINGS only increased by 2%. However, merchandise SOLD increased by 14%.

In presenting the record numbers, the CEO, Meg Whitman, said that “the company had been benefiting from changes in the user experience that had increased the number of auctions leading to sales” (as quoted in The New York Times, April 19).

This is a great example of the benefits of usability for e-commerce: income comes from multiplying the amount of use with the conversion rate. The more you improve the user experience of finding products, researching them, and buying them, the higher your conversion rate.

Advertising is important, but it only brings customers to the site. A good user experience is what convinces them to stay there. Careful usability testing and a minimum of user annoyances is at least equally important. Usability affects whether the customer makes a purchase or clicks off to another site.

In eBay’s case, user experience is so important for profits that it’s one of the main things the CEO mentions to the financial press in presenting the quarterly results. eBay has a particularly competent user experience department, but smaller companies usually find that a smaller usability effort can increase their financial performance materially. Your first usability test will uncover a gold mine of low-hanging fruit, to mix metaphors.

Good design isn’t just pretty, it’s also good for business.