Why SaaS Startups Fail at UX - and How to Fix It

SaaS startups often fail at UX for three main reasons: poor onboarding, lack of user-focused design, and neglecting scalability or accessibility. These mistakes lead to high churn rates, frustrated users, and lost revenue. Fixing UX issues can improve retention, boost customer satisfaction by 37%, and deliver up to a 400% increase in conversions. Here’s how to address these problems:

• Improve Onboarding: Simplify the process and tailor it to user needs. Clear, helpful onboarding can increase loyalty by 86%.

• Focus on User-Centered Design: Use user research and feedback to create intuitive, functional interfaces.

• Prioritize Accessibility: Design for inclusivity with features like keyboard navigation and high-contrast text, which benefits all users.

• Adopt Iterative Design: Test and refine your product continuously to align with user behavior.

• Leverage AI Tools: Use platforms like Figma and Hotjar for prototyping, analytics, and real-time feedback to optimize UX.

Quick Fact: 88% of users won’t return after a bad experience, but investing in UX can yield $100 for every $1 spent. Startups that prioritize UX not only reduce churn but also build products that users love.

Top 3 SaaS UX Mistakes Killing Your Product’s Success (And How to Avoid Them)

Common UX Problems in SaaS Startups

SaaS startups often face recurring UX challenges that can derail even the most promising products. These issues don’t just irritate users - they can directly harm your business. Let’s explore three of the most common problems that could be holding you back.

Poor Onboarding Experiences

A confusing onboarding process can quickly lose users. Studies reveal that 75% of users abandon a product within the first week if the onboarding experience is unclear, leading to a steep drop in retention. Many startups make the mistake of overwhelming users by introducing every feature at once instead of tailoring the experience to individual needs. Users are more likely to engage with a personalized, problem-solving approach rather than a generic feature walkthrough.

"A great B2B Customer Onboarding process isn't just a checkbox; it's the foundation of your entire customer journey." – Joseph Loria, RetentionCX

The stakes are high. Improving retention by just 5% can increase profits by as much as 95%. Additionally, 86% of customers are more likely to stay loyal if they receive helpful and welcoming onboarding content after purchasing. Beyond onboarding, poor design assumptions can further alienate users, making it harder to build lasting relationships.

Lack of User-Focused Design

Designing without truly understanding user needs is a recipe for failure. Many startups create interfaces that make sense to developers but confuse actual users. This isn’t just about how a product looks - it’s about how it works. Clunky interfaces, slow load times, frequent bugs, and poor navigation frustrate users and drive them away.

"User frustration is the precursor of churn. And when left unmanaged, your business will end up bleeding more customers than you can acquire." – Userpilot Team

Ignoring user feedback compounds the problem. Startups that rely on gut instincts often end up creating features no one asked for or workflows that are unnecessarily complicated. Imagine a clothing website without a search bar or with inconsistent category labels - users looking for a women’s blouse might click on “shirts” and still come up empty-handed. Poor design choices like these can lead to lost revenue, especially since 42% of customers are willing to pay more for a seamless, enjoyable experience. Beyond design, scalability and inclusivity are often overlooked but critical to long-term success.

Poor Scalability and Accessibility

Designing for today’s audience without considering future growth can result in systems that fail under increased demand. What works for 100 users might collapse when scaled to 10,000.

Accessibility is another area that startups frequently neglect. Over 1 billion people worldwide live with disabilities, and excluding them from your product limits both your audience and your revenue. For example, Domino’s Pizza faced legal action because its website wasn’t compatible with screen readers.

Even industry giants have stumbled. Apple Maps, for instance, had to issue a public apology and invest in costly redesigns after users reported inaccurate data and distorted imagery.

The numbers paint a stark picture. Around 32% of consumers say they’d abandon a brand they love after just one bad experience, and 94% of users distrust websites with poor UX. Even worse, 91% of users won’t bother complaining about a bad experience - they’ll simply leave. Consider this: 1 in 5 American shoppers abandoned their carts last quarter because the checkout process was too long or complicated. Fixing these issues could improve conversion rates by over 35% for large e-commerce sites.

These challenges aren’t inevitable. They often arise from a lack of planning and failure to prioritize user needs. Tackling these problems head-on is essential for building a successful SaaS product.

Why SaaS Startups Fail at UX

Understanding why UX challenges persist is key to addressing the problems outlined earlier. While identifying common UX issues is a step in the right direction, the bigger question is: why do these problems keep cropping up? The answer often lies in three major mistakes SaaS startups make during their development journey.

Skipping User Research

Far too many SaaS startups overlook user research, assuming they already know their customers. Here's the reality: while 80% of businesses believe they understand what their customers want, only 8% of those customers agree. Startups often focus on building the product, acquiring customers, and scaling operations, leaving UX design on the back burner. Tight budgets make matters worse, pushing founders to cut corners on research.

"It's only natural to assume that everyone uses the Web the same way we do, and - like everyone else - we tend to think that our own behavior is much more orderly and sensible than it really is." – Steve Krug

This assumption-driven approach leads to products that don’t align with user needs. Many startups skip product-market fit surveys, resulting in launches that fail to resonate with their audience. And yet, investing in UX pays off - every dollar spent on UX can yield a $100 return. Despite this, the importance of UX design is often underestimated, and a lack of iterative processes compounds the problem.

Overlooking Iterative Design

Another common pitfall is neglecting iterative design processes. Launching features without iteration often results in low adoption rates and unmet stakeholder expectations. Projects can drift away from their original goals, leaving users with a product that doesn’t meet their needs. Iterative design, when introduced early, helps reduce costs, incorporates valuable user feedback, and allows teams to refine the product before finalizing it.

"Great design is the iteration of good design." – M Cobanli, Founder of OMC Design Studios

Iteration recognizes that the first version of a product is often based on theoretical use rather than real-world application. Skipping this step increases the risk of mismatches between design assumptions and actual user behavior. Without iteration, startups also risk creating designs that exclude users through poor accessibility.

Neglecting Accessibility and Inclusion

The third major oversight is ignoring accessibility and inclusion. In the EU alone, 101 million people over the age of 16 have some form of disability, making up 27% of the population. Yet many startups treat accessibility as a compliance checkbox rather than a strategic priority, which can lead to legal issues, missed opportunities, and reputational harm. Poor accessibility results in confusing interfaces, user frustration, and high churn rates.

The numbers speak for themselves: 94% of users in a survey rated smooth and easy navigation as the most important feature. Ignoring accessibility alienates a significant portion of the market. But accessibility benefits everyone. Features like high-contrast colors, keyboard-friendly navigation, and clear alt text improve the experience for all users. By embedding accessibility into their product strategy - with clear goals and measurable outcomes - startups can avoid costly redesigns and tap into broader market opportunities.

These three missteps - skipping user research, avoiding iterative design, and neglecting accessibility - are a recipe for UX failure. The upside? With the right mindset and approach, these challenges can be entirely avoided.

How to Fix SaaS UX Problems

Every user experience (UX) issue comes with a practical solution. Addressing these challenges requires a methodical approach, leveraging the right tools and committing to ongoing improvements. Let’s dive into specific ways to solve common UX problems.

Improve User Research

Start by setting clear goals for your research. Use "If X, then Y" hypotheses to ensure you're gathering relevant data and asking meaningful questions. This structured approach helps you uncover insights that truly matter.

In the early stages of development, qualitative methods like interviews and open-ended surveys are ideal for understanding user motivations. As your product grows, quantitative techniques - such as analytics and performance tracking - help validate findings and measure progress. For example, INSAIM, a digital news agency, used interviews and questionnaires to collect actionable feedback for refining their platform.

When recruiting participants, focus on those who align with your target audience based on demographics, user behavior, or other relevant criteria. Keep in mind that even securing 30 minutes of their time can be challenging, so make it count.

For SaaS products, in-app surveys are particularly effective, often achieving response rates as high as 30%, compared to the typical 12% for general surveys.

Here are some proven research methods and their benefits:

Organize all research findings in a centralized hub. This ensures that insights are accessible across teams, fostering collaboration and better decision-making. Leading SaaS companies treat UX research as a shared resource, integrating findings into their everyday workflows.

With these insights, you can refine your product through an iterative design process.

Use Iterative Design and Testing

Begin small and test early. Tackling one issue at a time allows you to identify and address problems before they escalate. Iterative design revolves around creating prototypes, testing them, collecting feedback, and refining until the design aligns with user needs.

Ryan Daly Gallardo, SVP of Consumer Products at Dow Jones (Wall Street Journal), emphasizes the importance of this approach:

"We did tons of user research to determine what were the models, the messages, et cetera that we were going to go live with, but it was all about the testing and iterative approach that followed that got us to where we are today. So there is a moment where you almost have to take a leap of faith and have a very solid testing plan post-launch that takes you to where you ultimately want to be, which can look very different than what you originally thought."

Focus on areas that directly impact key metrics, such as user retention, activation, or revenue. Breaking large changes into smaller, testable steps minimizes risk while maximizing learning opportunities.

Document every iteration. Keep detailed records of user feedback, design changes, and the reasoning behind decisions. Building a repository of these insights creates a valuable resource for your team.

Use real-time feedback tools like in-app surveys, heatmaps, or session recordings to stay connected to user needs as your product evolves. For instance, INSAIM identified navigation issues in their merchandiser tool through usability testing, leading to improved filters and search functionality.

Once your iterative design is polished, shift focus to accessibility and onboarding for a more inclusive user experience.

Prioritize Accessibility and Streamline Onboarding

Accessibility isn’t just about compliance - it enhances the experience for all users. Start with these core practices:

• Keyboard Navigation: Ensure users can navigate via keyboard with logical tab orders and visible focus indicators.

• Color Contrast: Use contrast tools to make text and graphics stand out. Avoid relying solely on color to convey information.

• Typography Standards: Follow best practices for readability: line height at least 1.5× font size, letter spacing at least 0.12×, and font size no smaller than 10 points.

• Alt Text for Images: Provide concise, descriptive alt text for images and icons to support screen readers.

Incorporate users with disabilities into your testing process to uncover areas for improvement and ensure inclusivity.

When it comes to onboarding, simplicity is key. Use clear, jargon-free language in your interface and offer multiple ways for users to interact with your product. For complex applications, structure content using headings, lists, and breadcrumb trails to guide users effectively.

A great example of accessibility done right is the Bank of America homepage. In usability tests, 82% of participants navigated to the correct section with ease, showcasing how thoughtful design can enhance the overall experience.

Using AI Tools to Improve UX

Tackling UX challenges effectively requires more than just solid research and iterative design - it calls for tools that can supercharge the process. Artificial intelligence has reshaped how SaaS teams approach UX design, offering ways to automate repetitive tasks and deliver insights backed by data. These AI-driven capabilities help address common UX issues by simplifying workflows and providing deeper user understanding.

As Martina Pérez, Staff Product Designer at Hotjar, puts it:

"AI is a facilitator and versatile tool that enhances the efficiency of UX designers and provides a supportive framework for them to elevate their creative processes."

The impact speaks for itself: businesses using AI report up to a 400% increase in conversions. With 80% of companies already adopting AI and machine learning projected to generate over $4 trillion in value by 2025, the real question isn’t whether to use these tools - it’s how to use them effectively.

Better Prototyping with Team Tools

AI-powered design platforms are revolutionizing how teams collaborate and prototype. Take Figma, for example. It integrates AI features that help teams transition seamlessly from initial concepts to functional prototypes.

Figma’s AI capabilities include generating design templates, facilitating brainstorming sessions, and automating mundane tasks like organizing design boards. This allows designers to focus on solving creative challenges while collaborating in real time. Plus, Figma’s pricing is accessible, with a free plan for core features and Pro plans starting at $12 per month per editor.

Beyond speeding up prototyping, AI also enhances other aspects of UX design. It helps teams analyze user data, refine product copy, improve accessibility, reduce design bias, and create more user-friendly interfaces.

Using Analytics to Guide Design

Prototyping is just the beginning - AI also plays a key role in refining designs through analytics. Understanding user behavior isn’t a guessing game anymore. Tools like Hotjar use AI to analyze how users interact with your product, highlighting which areas of your interface draw the most attention. By combining heatmaps, session recordings, and user feedback, these platforms provide a complete picture of the user experience.

For SaaS startups, this kind of data-driven approach is a game-changer. Instead of relying on assumptions, teams can pinpoint exactly where users encounter issues or drop off. Hotjar, for instance, offers a free plan and Business plans starting at $39 per month. Its ability to process large datasets quickly not only speeds up decision-making but also lowers operational costs compared to manual analysis.

Adding Continuous Feedback Systems

In today’s fast-paced SaaS landscape, static feedback collection just doesn’t cut it. AI-powered continuous feedback systems offer a more dynamic approach. These tools can analyze user sentiment, predict behavior, and automate feedback collection, enabling faster and more effective design updates.

Such systems can quickly sort through open-ended responses, uncovering patterns that manual reviews would take far longer to identify. They also personalize surveys and deliver them at the best times to improve response rates. But it doesn’t stop at collecting data - AI digs deeper to find trends and provide actionable recommendations that improve the overall user experience.

For SaaS companies, this approach has delivered tangible results. AI integration has boosted efficiency and productivity for 34% of SaaS businesses. By tracking user behavior, preferences, and historical data, these systems enable the creation of personalized interfaces and content. Continuous feedback loops help ensure that products remain competitive in a market where user experience often determines success.

How Exalt Studio Solves SaaS UX Problems

SaaS startups often understand what needs to be done but struggle with the expertise or resources to execute effective UX strategies. Exalt Studio bridges this gap by offering continuous design support, complete MVP development, and a strong emphasis on accessibility and scalability. Here’s how their tailored solutions tackle these challenges.

Ongoing UX Support Through Design Retainers

For many SaaS startups, UX needs don’t stop after launch, but hiring a full-time design team can be costly. Traditional project-based design work often leaves gaps, which is where Exalt Studio’s design retainer model comes in. Starting at $4,000 per month, this approach provides consistent UI/UX support. Startups are paired with a creative lead and a dedicated designer who collaborate daily with founders via Slack. As Luke Dalton, Founder of Exalt Studio, explains:

"Design isn't a feature, it's the foundation of a successful startup."

This philosophy drives their approach, treating UX as an ongoing process rather than a one-time task. Their retainer model ensures strategies evolve alongside a startup’s goals and user needs, offering continuous refinement and support.

Complete MVP Design Services

Launching a successful MVP is no small feat. It has to be functional enough to test core assumptions while polished enough to attract and retain early users. Exalt Studio’s MVP design and development services, starting at $7,999, tackle this challenge head-on. They turn complex ideas into intuitive, conversion-focused products through a streamlined, end-to-end process. The result? MVPs that are both functional and visually compelling, complete with cohesive branding and user-friendly design.

Take their work with Perlon AI, for instance. Exalt Studio transformed a basic MVP into an AI sales platform by adding new features, refining its visual style, and improving the overall user experience. This overhaul led to a 150% increase in users. Similarly, their work with ScoutOS highlights their ability to enhance existing features while introducing innovative ones. With delivery timelines ranging from 4 to 12 weeks, startups can move fast without sacrificing quality.

Accessibility and Scalability as Core Values

Accessibility and scalability are often overlooked by SaaS startups, leading to costly redesigns and limited growth potential. Exalt Studio takes a different approach, embedding these principles into every project from the very beginning. They refine user flows, enhance features, and incorporate leading UI trends to create products that drive growth and perform seamlessly.

The results speak for themselves: Exalt Studio’s clients have collectively raised over $11 million, amassed more than 6 million design views, and reached over 200,000 users. Luke Dalton personally oversees the design of every project, ensuring accessibility and scalability are prioritized alongside visual design and user flow optimization. Their expertise spans web applications, marketing sites, brand identities, and mobile app designs, creating cohesive user experiences across all SaaS platforms.

Conclusion: Making UX Your Competitive Edge

For SaaS startups, success often hinges on one key element: user experience (UX). Sure, technical know-how and market timing play their part, but companies that focus on creating user-friendly, scalable, and accessible designs gain a lasting edge. The challenges of getting UX right can be tackled with proven strategies backed by solid data.

Take AI-driven tools and continuous feedback loops, for example. They’ve shown to significantly enhance UX outcomes. A striking 65% of companies that integrated AI into their UX processes reported higher user engagement. StreamElements offers a real-world example: they saw a 20% increase in product conversions and cut support tickets in half by using AI-powered research and in-product surveys.

UX design is evolving fast. Did you know that 78% of companies are now either piloting or fully implementing AI in at least one area of their operations? Product design is leading this shift, signaling a move toward creating products that adapt and grow with user needs.

The strategies discussed throughout this article aren’t just nice-to-haves - they’re essential. Companies that commit to constant improvement, build accessibility into their products from the start, and listen to user feedback are the ones securing funding, growing their user base, and building products people genuinely love.

Here’s the bottom line: your UX strategy determines whether users bounce or stick around. Ignore it, and you’ll face high churn rates. But treat UX as a priority, and you’ll turn users into loyal advocates who drive organic growth.

As shown by Exalt Studio’s achievements, great UX delivers tangible business results. Investing in UX isn’t optional - it’s essential. There’s no room for failure when it comes to creating experiences that truly resonate with users.

FAQs

How can SaaS startups improve their onboarding process to boost user retention?

To boost onboarding success and keep users coming back, SaaS startups should aim for a smooth and straightforward sign-up process. This means cutting out unnecessary steps - like excessive form fields - and offering options like single sign-on (SSO) to make signing up quicker and easier. At the same time, it’s important to highlight the product’s main value right away, so users can immediately grasp how it benefits them.

Tailoring the onboarding experience to match user roles or behaviors can make it feel more relevant and engaging. Adding interactive features, such as tooltips, guided product tours, and progress bars, can also simplify navigation and help users get comfortable with the platform. By reducing friction and helping users see success sooner, these strategies not only encourage loyalty but also lower the chances of churn.

How can SaaS startups create user-centered designs that scale effectively as they grow?

To craft designs that truly resonate with users and can grow alongside your SaaS startup, the first step is understanding your audience. Conduct thorough user research to uncover their needs, behaviors, and challenges. This way, your design not only becomes more intuitive but also meets their expectations head-on.

Equally important is building a flexible design system. By using consistent UI components and layouts that can adapt as your product evolves, you’ll be ready to roll out new features or scale up without losing the seamless experience users expect.

Finally, make iterative design a core part of your process. Regularly gather user feedback and refine your product based on real-world insights. This ensures your platform remains easy to use while staying prepared for future growth.

How can AI improve UX design for SaaS startups, and what’s the best way to use these tools?

AI is transforming UX design for SaaS startups by automating tasks, analyzing user behavior, and providing insightful data. This allows design teams to craft intuitive, user-friendly interfaces more quickly and with greater accuracy.

Startups can tap into AI tools for tasks like design generation, prototyping, and analyzing user feedback. For instance, AI can recommend design elements tailored to user preferences or take over repetitive tasks, streamlining workflows. By weaving these tools into their design process, startups can concentrate on creating scalable, user-focused solutions while conserving both time and resources.

Related posts

• 10 SaaS UX Mistakes That Are Costing You Customers (and How to Fix Them)

• How to Design a Frictionless Onboarding Experience for SaaS Users

• How to Find a Great SaaS UI/UX Designer Without Hiring Full-Time

• The Ultimate SaaS UI Checklist: 10 Design Mistakes to Avoid