The NY Times has an interesting article about the iEconomy and how most app developers aren’t making any money selling iPhone apps.
This is true today. The competition for apps on Apple’s app store is intense.
There used to be a time when all you had to do to make money in apps was to create a good app and post it in the app store. People would find you there, and you could make money from day one with little to no marketing.
Those days are gone.
Now, in addition to creating a good app, you need to get it noticed, so it stands out. This includes doing the following:
Creating an icon for it that helps it stands out from the crowd.
Creating a strategy to make it easier for it go viral.
So is it still worth it to build mobile apps on the app store?
Well the good news is that, even though it requires more work now to create a hit app than it did before on either Apple’s app store or Google’s Play market place, the user base of potential customers keeps increasing as Apple and Google sell more smart phones.
So yes, the risk is much higher, but the potential reward payout has also increased in the process.
The other benefit from all this is that most app developers won’t go through the trouble of doing all those steps, which makes it easier for the few that do to stand out.
If you still think it’s too much work, then you can consider creating an app for other mobile platforms like Blackberry 10 or Windows Phone 8. Although they have less users, you would also have a lot less competition from other app developers.
Having a great product is just part of the equation. Being able to market it successfully is an equal, if not more important part of the puzzle. As a new startup, you probably don’t have a very big marketing budget to begin with. Ideally, you would like your product to market it itself, by having people automatically recommend it to others. So how do you get people to talk about your product and make it go viral?
1. Have a great product.
This goes without saying. No matter how much you spend on marketing, if your product isn’t very good, then people aren’t going to want to use it, leave alone recommend it to others. People only talk about remarkable products. Is your product remarkable? Is it that much better than anything else out there?
2. Don’t make users login to try out your product.
Many users (myself included) get turned off when they can’t even try a product, without first having to provide personal information. Let them try out your product first, and if they like it, then they will login. Otherwise, expect many users to close your product before they have even tried it.
3. Make it really easy for users to login.
Assuming that users like your product enough to want to login to use it, make sure it’s really easy for them to do so. They should not see any of the following:
Unless your product involves any type of public forum where the user might not want to be identified with their real name, then don’t ask them to create a username, that they will then need to remember just to use your site or app. The days of username based accounts should be long gone.
Where possible, offer a one click Facebook login option. It’s easier for you, and easier for the user.
Don’t ask for any more information than is required. Don’t ask for birth dates, addresses, phone numbers etc. unless you have a good reason to need it.
4. Make it work well, even if you’re the only user.
The flip side of adding social networking tools to products these days is that some of them only work if your friends are also using it. Unless you have a proper launch strategy in place to fix this issue, you’ll end up with a chicken and egg problem. The product is useless without users. And users won’t be attracted to the product because it’s useless. So make sure the product has functionality in place even if you’re the only user – but make it work better if your friends are also using it.
5. Make it work better, when friends use it.
Social networking products like Facebook, Foursquare etc. are almost useless if none of your friends are using it. However when your friends come on board, then the product becomes a lot more useful. Facebooks’ developer tools make it easy to integrate Facebook login and friend lists into your product, so users can invite their friends. Create features that genuinely add functionality to your app when users’ friends are using it (as opposed to spamming your friends with no benefit to you).
6. Make it really easy for users to share / invite others.
Assuming you have a great product that users enjoyed using, and you have convinced them to share it with others, then make it easy for them to do so. There should be a one click share or invite button for them to use. Make it any more complicated than that, and you risk them losing the motivation to do so.
7. Bribe users to invite their friends
If your product doesn’t really have any social features built in, you can try bribing your users to invite their friends. Dropbox made a big success of this through their referral program. Offer users credits towards paid features for friends that they invite and start using the system.
There are many users out there who are used to not paying for things. By offering such a program, you can gain benefit from this crowd as well.
8. Sign your Product
Another way to make your product is to let users share it without realizing it. YouTube does this by letting you embed videos onto your site, with a prominent YouTube logo in the corner. Even Apple does this by inserting “Sent on my iPhone” text into emails you send. Can you piggy back on usage of your product by adding a signature somewhere?
Many articles have been written about why so many startups failed. Inevitably it comes down to any of the following reasons:
Not having the right product
Not being able to market the product successfully
Running out of money
So as a startup, what can you do to overcome these issues or at least set yourself up for the maximum potential success?
1. Focus on the MVP
Don’t worry about how you will market the product, how much you will charge for it or any of those details at this point. Just focus on the minimal viable product (MVP) that people would enjoy using (and potentially pay for). The idea should be to get this into the hands of users as quickly as possible. Leave the fancy and frill features for later on, once you have validated your product. This way you will know if you’re on the right track, without having wasted time and money by going in the wrong direction.
2. Find Early Users
Find people around you who match the audience you are planning to target. If members of your friends and family match this description, get them involved testing early versions of your product and (more importantly) get feedback from them. Is this a product they would use? Ideally, try to find people who have the very problem that your product is trying to fix.
There are other sites you can use to get beta testers to give you feedback, so use those if required.
After the initial testing, if they continue to use the product, that is a good sign that you may be on to something. If they stop using the product even after your constant prodding then assume that either they don’t match your target demographic or that your product still needs some polishing before it is ready for mass release.
3. Keep Iterating
If you find that users are not returning to your product, find out why. Many times people who are close to you may lie to you for your own benefit, in order to give you support and not discourage you. So ask questions like:
What would you change about this product?
Are there any features you would like to see added?
Use the feedback given to improve the product and release new versions that incorporate that feedback. If the users helping out really have the problem that you’re trying to solve, then it’s in their interest for your product to succeed so that their problem can be solved. They should be more than happy to test new versions and give you genuine feedback on whether the product has improved or not. I have used this approach for many of my products.
4. Market when Ready
One mistake I’ve seen a lot of startups make is to start marketing a half baked product. The few users they do have rarely use their product, so they assume that their problem is not having enough users. In fact, the problem is that their product isn’t good enough!
On the other hand, if you do have a product that users are happy with, then now is the time to start marketing it. One way to know if you’re at this stage is if you can get testimonials or positive reviews from users with ease. After all, if they are happy with the product, then chances are good that there will be others out there who would also benefit from this product.
By using this approach, you can ensure that you’re spending money where needed. It’s very easy for startups to run out of money by spending money developing unnecessary features early on, or by trying to market half baked products. Instead if that money was spent on building the core product with a loyal base, before beginning to market it, then their chances of success would be much higher!
This past weekend, I attended Startup Weekend Taipei. If you’re not familiar with what a startup weekend is, it is a weekend event that attracts developers, designers, marketers and anyone with an idea. They get together to form a team, develop an idea over two days, then pitch it in front of judges for a prize on the final evening.
Friday:
The event was sold out and had attracted around 120 attendees. Each attendee wore a name tag with a dot to identify their skill set. Mine was red, signifying “Business / Marketing”. The joke going around was that these were the people with no specific skills.
I had come in with several ideas of my own, and was toying with which one was the best for this event. To date, all my projects have been developed on my own, through outsourcing. This was the first time that I would be able to form my own team and manage everyone from the same room. I was looking forward to the process, experience, and the contacts I hoped to make along the way. For most people, the networking is their biggest gain from this event, and I too expected to gain from that.
The pitch I ended up doing was an app (web and mobile) to help users search for food items they were craving, and find restaurants nearby that served them. There was a long line-up of about 30 people waiting to present, and I was in the middle of the pack. I didn’t want my pitch to get lost in the shuffle, and wanted a way to stand out so people would remember it.
I noticed that most pitches were done in Chinese, since the event was held in Taiwan. I thought about doing my pitch in Chinese as well, but then decided to do it in English. I figured that I wanted the members of my team to be able to speak English, so doing the pitch in English would eliminate non English speakers from joining. It would also make my pitch stand out among English only speakers.
Lesson 1: You don’t always need to target the biggest market. It can sometimes be better to be a big fish in a small pond, than a small fish in a big pond.
Rather than just describing the problem that I hoped to solve with my product, I told a story of how my pregnant wife always had cravings for particular foods (true story!). For example, she might suddenly want a Kung Pao chicken (宮保雞丁) and would send me out on my scooter to find this food. I talked about how frustrating it was to not know which restaurants served those particular foods, without being able to see their menu first.
After the pitches were completed, attendees got to vote on which ideas they wanted to see continue. The top 15 ideas were then selected. Many people came up to me and recognized my pitch among the rest. “You’re the one with the pregnant wife”.
Lesson 2: Use stories where possible. People remember stories.
As our team was forming, I realized that we needed the right match of skills. We had three coders, a mobile and a marketing person. I was informed that we needed a designer. I sent one of the members out to recruit a designer. He did well, and returned with one shortly. Our team was complete.
Lesson 3: Form a team with skills that complement each other well. Your idea is only as good as the team that surrounds it.
Our mission that evening was to come up with a team name. This was tough for us, because our target market was local Taiwanese, so traditional English names wouldn’t necessarily work with them. We ran through several combinations.
We found some that we really liked, that were promptly rejected by the local Taiwanese members of our team as not being “local friendly”. Eventually we settled on Food Jing, a play on the word 附近 in Chinese which means “nearby”.
Lesson 4: Choose a name that resonates with the market being served.
Saturday:
The coding team, led by Dobes and Greg spent all day developing the front and back-end of the product, working in tandem with our talented designer, Quaint. Will worked on the mobile aspect. In the mean time, Hao who had previously claimed to have “no relevant experience” was one of the hardest workers on the team – developing a comprehensive customer survey, and then interviewing a lot of people to get feedback on the problem we were trying to solve. Later, he would visit twenty restaurants (the Taipei rains didn’t help his cause) to get feedback from owners there as well.
Lesson 5: There are no small roles. Every member of your team can contribute somehow.
During the day, several mentors who had been assigned to assist teams, came to visit us to monitor progress. They asked questions about our business model and there were several that I couldn’t answer. After each visit, I found myself redoing parts of the plan to address the raised issue. It seemed that just when we thought we had thought of everything, someone new would point out something we had overlooked.
Lesson 6: You can’t see the forest for the trees. When you are truly invested in a project, it is easy to get too focused on the details. Outside opinions can be extremely valuable at these times. If they don’t get it, there’s probably a problem to be fixed.
By the end of the day, we had made good progress, but there was still something missing. Our Facebook fan page hadn’t gotten the traction we had hoped it would get. (We would later find out that we had accidentally restricted it to fans in Taiwan only, which blocked a lot of fans from getting through – oops!). So we needed something to get us back some momentum.
As part of the marketing team, I noticed that the word foodjing could be used in many creative ways. So I found a freelancer online to create a parody video of “Killing Me Softly” by the Fugees. We would later release it as being by the Food Jies. Fans loved it, and it helped market our brand as being a little zany and over the top.
Lesson 7: Problems and challenges will arise in any venture. It’s how you overcome and rise from them that determines your future success.
Sunday:
The final day was spent completing the demo and working on our presentation. I decided to build on the momentum we had from the previous day, by ordering tshirts with our logo, for our team to wear on stage. This proved extremely difficult to get done in a single day (on a Sunday no less). Once again, Hao came to the rescue, running across town from vendor to vendor until he found one who could print just one for us. We took it!
During the practice presentations, I had worked to overcome all the questions that the mentors had given me the previous day. I invited more to grill me further. Mark Koester recalled a stunt that his startup team performed during their final presentation. They had ordered a hot dog during the demo, that was later delivered on stage. We decided to do the same thing in ours by ordering a taco during our demo.
Lesson 8: Find ways to make your presentations different from the rest of the pack, so it will be noticed by the judges and audience.
One of the visitors who gave us advice, would later turn out to be one of our judges. He asked me about where our revenue would come from. I told him that while Taiwan had a lot of smaller, mom and pop restaurants, we planned to focus on the larger restaurants that could afford to use our services. He frowned and commented that if it was him, he would be focusing on those smaller restaurants, rather than the bigger ones, since that’s where the real opportunity was.
I thought about his comment a lot and realized it made sense. I refocused our presentation to emhasize the smaller restaurants and the long tail of food. This also further differentiated our product from competing ones on the market.
Lesson 9: The mentors are provided for a reason. Listen to their advice and follow it!
It was presentation time. Pandey started us off with massive enthusiasm. During the demo, he showed how a taco could be ordered. During my half of the presentation, the taco was delivered on stage to a thunderous ovation. I wore our branded tshirt underneath, and revealed it during the presentation, which also drew applause. Finally it was down to the judge’s questions. Practice makes perfect. No surprise questions there, so no problem with the answers. The crowd seemed to like the extra touches we had prepared.
Lesson 10: Have fun with it. People like to deal with happy people.
Judging from the responses, I suspected we had a chance at a top three finish.
As the second and third place winners were first revealed, I wondered if coming in first place was possible. Out of the corner of my eye, I thought I noticed Sascha Pallenberg aim his camera phone at me, as if expecting to see us win. Sure enough, we were announced as the winners and pandemonium ensued on our team. All the work we had put in had paid off, and we had come away as winners!
Later, I had a chance to mingle with the judges to ask what specifically they had liked about our team. The feedback given included having a clear message of the product we were trying to sell, as well as execution of this idea. Business cards were exchanged. New relationships were formed.
The Future:
Now that startup weekend has ended, a new chapter begins. There has been great support on our fan page, which has inspired us to continue this process. Meetings have been arranged this week and next, and the business plan has been honed down further. I realize that there is a long road ahead of us, but it’s one that I’m looking forward to traveling. I hope to document more details on this blog as they happen.
“Social media is not a marketer’s platform. It belongs to consumers.”
Marketers used to control their message. They created their own ads, and shaped them how they wanted to be seen. However, since the rise of social media, consumers now control the message. Viral messages can be positive or negative about a brand, and no single person can control it. Users are no longer passive and can now publicly engage with brands, creating new stories in the process.
The brands who are successful now are those who adapt their strategies and embrace social media platforms, rather than ignoring or worse – fighting them.
I was in a Mexican restaurant recently and noticed that much of what they served – burritos, soft tacos, hard tacos – had the same filling, but was presented with different wrappers. That made sense – different people have different preferences and tastes for how they consume their food.
You can use this same concept in your online business. If you’re selling content, the same content can be distributed to your user base via different media – podcasts, YouTube videos, ebooks, physical books, mobile apps. This provides you with two benefits:
You increase the variety of products in your “menu” – giving your user more options on how to receive your content.
Unlike items on a restaurant menu, having additional products in the online world also lets you tap into additional distribution channels. So now in addition to your site, users can also find you on iTunes, YouTube, Amazon, mobile app stores and other sites that host different media product0s.
I’ve used this strategy for CLO, letting users access my content via podcasts, blog posts, downloadable PDFs and mobile apps. Are you taking advantage of all the distribution channels that are available to you?
The NY Times has an interesting article about the iEconomy and how most app developers aren’t making any money selling iPhone apps.
products. Is your product remarkable? Is it that much better than anything else out there?
