Application Performance as a KPI for e-Business
August 11, 2016

Sven Hammar
Apica

Share this

Web application load times can make the difference between your e-business thriving or dying. Speedy load times are so essential to a web application’s success that they should be considered a key performance indicator.

Comparing sales data with performance data establishes a direct relationship between the two: A platform that performs faster will lead to higher sales. On the flip side, the damage can be significant when performance takes a hit. Amazon found that a 100ms increase in page load latency translates to a 1 percent drop in sales.

Customer Patience: Conversion vs. Speed

Performance is an often overlooked KPI. According to a study presented at Velocity 2013, each second of reduced load time between 15 and 7 seconds results in a 3 percent conversion rate increase, and each second between 7 and 5 seconds results in a 2 percent conversion hike.

In financial terms, a 100ms load time reduction can boost revenue by up to 1 percent. According to CA Technologies, most users will abandon an application if the load time is longer than six seconds. Sales come to a dead stop when the platform goes down or jumps to double-digit load times.

A theoretical example (by Apica) found that a business bringing in about $800,000 in weekly revenue will experience a total loss in revenue during an outage or a plummet in performance. While the revenue rate sees a brief 20 percent hike when the platform returns to service, it is not enough to compensate for the outage losses. Furthermore, when the example platform returned, it experienced load times of 10+ seconds — so the platform missed additional sales due to customer abandonment. Online sales can see as much as a 10 percent drop in revenue when performance is lacking due to visitor spikes.

SEO Impact: Google Rankings

Search engines including Google tend to favor websites that load faster over ones that load slower. So, if your site runs slower, you’ll be bringing in less traffic from search engines. However, content quality is still the most important metric, so slow load times should be treated as an opportunity for improvement rather than a reason to panic.

Establishing Relationships: Brand Impact

Load times also play into the brand loyalty KPI for application performance. Slow load times have a negative effect on brand recognition through a phenomenon called “web stress.” Waiting for a page to load is a stressful event, and continuously experiencing that stress causes an increasingly negative customer reaction to your brand.

Adding a mere half second to load times generates a 26 percent increase in frustration and an 8 percent decrease in engagement (Radware). Even if your application far outweighs the competition, people who use it will remember it as “the slow one” if it has long response times.

The Good News

There is no need to test your infrastructure on a live, unsuspecting audience. Professional advanced load testing platforms provide the means to understand how well your web applications perform under real-life end-user demands. These platforms simulate millions of concurrent, virtual users, helping your business plan and establish the best infrastructure for fast load times to meet both current and future demand.

Maximize profitability by providing a service fast enough to capitalize on conversions without overspending on unnecessary infrastructure.

Sven Hammar is Founder and CEO of Apica.

Share this

The Latest

September 22, 2017

UK businesses have attained high levels of business-IT alignment in of all sizes, with IT pros demonstrating strong business understanding and business pros exhibiting strong IT knowledge to increase business performance, according to a new survey by ManageEngine ...

September 21, 2017

The increased complexity of new computing architectures coupled with new application development methodologies – especially in the face of time-to-market and security threat pressures – should make secure UX the first strategic decision for CEOs and CFOs on the path to digital transformation ...

September 19, 2017

IT professionals tend to go above and beyond the scope of their core responsibilities as the changing business landscape demands more of their attention, both inside and outside of the office, according to the Little-Known Facts survey conducted by SolarWinds in honor of IT Professionals Day ...

September 18, 2017

Digital video consumption is viral and, according to a new study released by IBM and International Broadcasting Convention (IBC), more than half of the 21,000 consumers surveyed are using mobiles every day to watch streaming videos, and that number is expected to grow 45 percent in the next three years ...

September 15, 2017

No technology that touches more than one IT stakeholder, no matter how good and how transformative, can deliver its potential without attention to leadership, process considerations and dialog. In this blog, I'd like to share effective strategies for AIA adoption ...

September 14, 2017

Enterprise IT environments are becoming more heterogeneous and complex, with fragmentation permeating cloud infrastructure, tooling and culture, according to a survey recently conducted by IOD Cloud Technologies Research in partnership with Cloudify ...

September 12, 2017

One area that enables enterprises to reduce complexity and streamline operations is their virtual desktop infrastructure (VDI). Virtualization is a linchpin of digital transformation and effectively optimizing an enterprise's VDI is essential to moving forward with digital technologies. Delivering the best possible VDI performance means taking a fresh look at what "desktop" means today. The endpoint, or desktop, now can be a physical thin client, a software-defined thin client, a traditional laptop, a phone or tablet. To reduce operational waste and achieve better performance across the desktop environment, consider these five actions ...

September 11, 2017

In incident management, we often overlook the simple things in favor of trying to do too much, too soon. Why not make sure we've done the fundamentals properly? ...

September 08, 2017
For our Advanced IT Analytics (AIA) Buyer's Guide, we interviewed more than 20 deployments to help us better assess vendor strengths and limitations. So given the abundance of riches to work with, I've decided to illustrate several of the more prominent AIA benefit categories with actual real-world comments ...
September 07, 2017

The Input/Output Operations per Second (I/O) capabilities of modern computer systems are truly a modern wonder. Yet no matter how powerful the processors, no matter how many cores, how perfectly formed the bus architecture, or how many flash modules are added, somehow it never seems to be enough ...