You’ve thought up a great solution to a problem, and you’re wondering if it could turn into a viable business. The good news is, the growth curve of new technologies permeating our lives looks like a hockey stick, with no signs of slowing down. How can you make your passion, hobby, or industry even better with your app idea? In the beginning, the answer lies in tons of research, finding the gaps in current digital product offerings, and maximizing on what hasn’t been done.
| Do your research. |
The first step is to become an expert on the problem you’re trying to solve – the people who the problem affects, its causes, industry, possible solutions, similar products, etc. Much of this can be informed by looking at the competitive landscape. Here’s how:
- App Store
Browse and search on the App store. Buy an app if you have to, as the experience is worth it. Read reviews, notice ratings, and ask yourself why you’d find use for it.
- Search Engines
Utilize any search engine to type keywords, or uses of your product idea and see what comes up. You’ll commonly see an interesting correlation between what your search terms are, and which types of sites or apps appear.
- Current Users
Find people who use the product and ask them what they like and don’t like. Noticing any trends offers you important market insight.
Look for anything that indicates how the competitor markets its products–such as ad buys, ad campaigns or promotions they’re offering. Go on their site and enter your contact information if prompted, and see how they follow up.
- Competitive Map
Make a list of similar products to yours, and what major needs they’re meeting (and perhaps, which ones they aren’t). Consider this simple look at Pandora as a service, and how directly their competitor’s features were informed by their own missing features.
While doing your research and trying out other web or mobile apps, ask yourself some simple questions.
– How are they making money? (Is the app free? Do you have to pay for certain features? Is it riddled with advertisements?)
– Which parts confuse you?
– Where do you become disinterested, or particularly engaged?
– Can you imagine any of your friends wanting to use the app?
– Do you feel motivated to use it again?
– Is it missing features that you’d want to see?
Here’s why these questions and research will ultimately mean a better product.
Clearer user insights
Understanding how users rate the competition paints a picture of what customers are attracted to. The user is king. Give them what they want!
One of the biggest reasons for apps being ineffective is a lack of focus on a particular user or core feature set. Identifying your competitor’s strengths and weaknesses through user feedback, allows you to focus even more on how to make your product different (and better). Going against the grain in an industry attracts a small but highly loyal counter-culture market segment; the foundation to build a business on.
Understanding how your competition is acquiring users is a powerful resource. Bigger, more established businesses may have more marketing dollars, but don’t mind that. Use the fact that you’re scrappy to your advantage. Maximize your smaller marketing budget by avoiding the primary marketing channels your competitors are using and find a way to get in front of your user with less noise.
Having said all of this, we’ve seen some be distracted by competitors and lose sight of one thing that’s always more important: the user. While this seems obvious, it is often overlooked. Always, always, think from the user’s perspective.
| Find the gaps. |
Let’s say you’ve done your research, and find existing products similar to your app idea. No need to be discouraged. This is very likely, and predominantly positive. Finding others in your arena can imply a couple of things.
I. People are searching for a solution to this problem, and aren’t happy with their current options.
Have you ever heard of the similar products that are popping up? If not, this a big indicator that there’s room for another product in the same vertical. This probably means no one has struck the right chord with users, or executed it well. If only there were testimonies from people who’ve tried out these other products, talking in detail about what they liked or disliked…
Oh, wait! There are!
User reviews are goldmines. Read each one of them to learn what customers aren’t happy with — or which features stood out positively. This is one of the big advantages of being the second-mover on an idea, as opposed to the first; you have a test project to learn from, and a wealth of real user feedback.
II. Your competitor is successful, and dominates the market. You need to get creative.
Perhaps your competitor is killing it, and many users seem to adore their service. If you calculate the size of the market, and find that a successful competitor has 60% or more of the total market cap, you’re going up against a Goliath. This is the type of scenario that may mean abandoning, or seriously re-thinking your idea.
However, while a successful competitor presents a challenge, your idea is rarely dead in the water. Your job now is to identify the part of the market others aren’t reaching, and put your focus on that gap–even if it’s narrow. At your early stage, you’re nimble and can adjust to user needs on a dime. A bigger, more established competitor can’t. This is an advantage!
If your competitor is targeting the exact same slice of the market as you, there are still ways to utilize a better business model, push unique marketing efforts, and create stronger product features to find your own place with users and potentially take down your competitor.
A great example of this is Wesabe and Mint–two very similar products. Wesabe was a first-mover on a finance app, built to help track your money and show trends in spending. After observing Wesabe’s launch, Mint not only improved their marketing efforts, but created a way to automatically categorize transactions–and grew to over 1.5 million users in about 2 years. Wesabe eventually shut down, while Mint sold for a reported $170m.
| Use the gaps to your advantage. |
Now that we’ve discussed finding the “gap” between you and your competition, wide or narrow, it’s important to capitalize on these differences and build something that users are hungry for.
One of our clients, SparkDJ is a perfect example of this. At first glance at this product, one may think SparkDJ is another music streaming app. The “giants” of this space present a solid threat to him; Pandora, Spotify, and Apple Music are all doing well and dominating different areas of the market. It could be argued there isn’t room for another solution to music listening. Here’s how SparkDJ found traction anyway.
– His product features are fun and distinct. SparkDJ gives listeners seamless and tasteful transitions between songs, so there’s never a lull in the mood of a party. This emulates the same value of a live DJ, which usually costs upwards of $500-$1,0000/night.
– The business model is unique. Instead of a monthly subscription like his competitors, SparkDJ gives you the option to pay for a “party” — creating a revenue model with an interesting twist, accentuating the product’s core identity; a curator of experiences, not just playlists or channels. This immediately separates it from a music streaming service, and targets a need that no one (besides a professional DJ) can provide.
– The marketing and virality of this product is completely different from the competition. While at a SparkDJ “party”, guests can use the app to request songs, and interact with other users attending. This motivates others to download the app, and engage in it frequently.
SparkDJ could have looked at the world of music streaming and decided it was too crowded to add to. But by finding gaps in the market and being fearless in his business tactics, our world now can have a DJ at every party, for a fraction of the cost. Who knew?
NEXT UP: Building an App Business 101, Step 2: Be bad to be great.
So you’ve got an idea for an app. Or maybe it’s merely a thought that keeps revisiting you. Understanding your next move is a challenge. How do you know if it’s a good idea? Can you build it if you’re non-technical? Will it generate any revenue?
We believe in sharing as much knowledge on executing these ideas as we can. These 5 steps will guide you from that first twinkle of inspiration, towards building a digital product that makes the world a better place.