Ideally no percentage increase should take more than maybe 10-15% of the total time.

If the website or app consistently violates this, then it is time for a different design.

But more often than not the "Good enough, ship it" wins out and the user experience is suffering.

I can understand that time to market and maximizing profit is important, but at the second version the expectation is that it is improved.

Google was very aware of this with their search engine, so these things matter.