The Real Cost of Slow Time vs Downtime
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The Real Cost of Slow Time vs Downtime Tammy Everts @tameverts CMG Performance and Capacity 2014
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Transcript of The Real Cost of Slow Time vs Downtime
The Real Cost of Slow Time vs Downtime
Tammy Everts
@tameverts
CMG Performance and Capacity 2014
Slide 2
Who’s had an outage-related
emergency?
Slide 3
Who’s had a performance-
related emergency?
Slide 4
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Downtime is better for a B2C web service
than slowness. Slowness makes you hate
using the service, downtime you just try again later.
Lenny Rachitsky
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“ ”
Let’s look at some
real-world examples.
Performance affects many business KPIs every day
Revenue
Conversions/downloads
User satisfaction
User retention
Time on site
Page views
Bounce rate
Organic search traffic
Brand perception
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Real User Monitoring at Walmart
How to Measure Revenue in Milliseconds
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Shopzilla’s Site Redo: You Get What You Measure
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Case study: The impact of HTML delay on mobile business metrics
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YSlow 2.0, Stoyan Stefanov
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Firefox and Page Load Speed – Parts 1 & 2
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20% more organic traffic
14% more page views
Increased sales
For Smartfurniture.com,
faster pages =
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Current state of the union
for web performance
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Radware: State of the Union for Ecommerce Web Performance [Fall 2014]
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Time to interact (TTI)
The moment primary content
and call-to-action are rendered
in the browser
Slide 23
Optimal load time 8-second delay
Jakob Nielsen: Website Response Times
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Radware: State of the Union for Ecommerce Web Performance [Fall 2014]
Downtime vs slow time
Average revenue loss per hour of downtime
Average revenue loss due to one hour of
performance slowdown (slower than 4.4s)
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TRAC Research/AlertSite: Online Performance Is Business Performance
$21,000
$4,100
However…
…website slowdowns occur
10 times more frequently
than outages.
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TRAC Research/AlertSite: Online Performance Is Business Performance
2X the impact
Slide 28
Whether it’s a public website or an internal web-based application, most of us believe that a successful DoS/DDoS attack results in a service outage.
However, our Security Industry Survey (conducted with 198 respondents within a wide variety of global companies, most of which were not Radware customers) uncovered that the biggest impact of DoS/DDoS attacks in 2013 was service level degradation, which in most cases is felt as service slowness.
Slide 29
Radware 2013 Global Application and Network Security Report
“ ”
Agenda
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Permanent abandonment rate
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Akamai: The Impact of Web Performance on E-Retail Success
Outage Slow performance
9% 28%
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Customer lifetime value (CLV)
Total dollars flowing from a customer over the
entire relationship with that customer
CLV is one of the biggest predictors
of retail success
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New visitors Return visitors
Time on site (minutes) 2:31 5:31
Page views/visit 3.88 5.55
Purchase intent Return visitor is 9X more likely to make a
purchase than a first-time visitor.
How to measure the short-term
and long-term impact of slow time
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Lenny Rachitsky: The Upside of Downtime
Minutes of downtime
x Average revenue per minute
= Downtime losses
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Average cost of downtime
$5,600 per minute
$300K+ per hour
Slide 40
Gartner: The Cost of Downtime (July 2014)
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Challenges of measuring impact of slow performance
Need actionable performance data
Need visibility into performance of third-party scripts
Need visibility into quality of experience (QoE) for users
(availability PLUS speed)
Need to be able to measure the business impact of
performance issues
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How to calculate short-term losses due to sub-optimal
performance
Step 1: Identify your cut-off
performance threshold
4.4 seconds = average delay in response time
when business performance starts to decline (TRAC)
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Step 2: Measure TTI / AFT / Speed Index
for pages in flows for typical use cases
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Step 3: Calculate difference between
threshold and actual measurement
5.6
-4.4
2.2 seconds
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Step 4: Pick a KPI
1-second delay =
2.1% decrease in cart size
3.5 - 7% decrease in conversions
9 - 11% decrease in page views
8% increase in bounce rate
16% decrease in customer satisfaction
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Step 5: Calculate losses
3.5% decrease in conversion rate
x 2.2s slowdown______________
7.7% decrease in conversion rate
How to calculate long-term losses due to slow performance
1. Identify percentage of converting traffic that experiences speeds slower than 8-second poverty line threshold.
2. Identify current CLV for those customers’ (individual or aggregated).
3. Using the stat that 28% of those customers will permanently abandon pages that are unacceptably slow, identify the lost CLV.
For example…
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CLV loss sample scenario
If median total value of customers over the past 3 years is $1000,
then predicted future value for the next three years is $1000.
(CLV is $2000.)
Current converting user base of 10,000.
10% of those customers (1000) experience TTI of 8+ seconds.
28% of those customers (280) will not return.
CLV loss = $280,000
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Takeaway
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Tammy Everts
@tameverts
webperformancetoday.com
Slide 56
Questions?
