How to Keep Your Consumer App From Failing Within the First Year

consumer app

So you’ve had this awesome game-changing consumer app idea for years, and now you’ve finally gathered the chutzpah to make your mobile app dream a reality. You’ve consulted all your friends and family and even gone as far as running it past a few people in the industry. Everyone agrees—it’s a great idea. But a lot more goes into a successful app than just an idea and the development work.

Many consumer apps of all sizes and budgets fail because they overlook key factors that directly impact the success and sustainability of their app. Here are some companies we, at Process Street, have found that did almost everything right—and failed as a result of one mistake.

Ignoring the impact of even one of these five details will prove harmful—if not fatal—to your consumer app.

Know the Consumer App Market Before You Launch

Indie developer Gregory DSouza came up with the seemingly great idea of a customer service messaging app called Fastr. Word on the street was that messaging apps fared well (WhatsApp, Line, Kik Messenger, Telegram, etc.), and that easy-to-use customer service platforms (ZenDesk, Desk.com, Smarter Track) also fared well. So it’s no surprise that DSouza assumed that an app mashing these ideas together would be successful.

When the app ultimately failed, DSouza realized that this product combo had no market—customer service teams were already using messaging systems that easily connected to their ticketing platform. Plus, customer service teams want to limit direct communication with tech-illiterate customers, not amplify it.

According to Marc Andreessen, VC and also co-founder of NetScape and Andreessen Horowitz, people often assume that product quality and market size is the same thing. While your idea may seem great conceptually, if it doesn’t appeal to enough people, then it will fail.

Takeaway: Do your consumer app market research

While many consumer app creators go with their gut when it comes to conceptualizing their product, there are many tools and online resources that will better inform you about the market with real data.

An excellent place to start looking is at various app analytics. SensorTower is a platform with a massive amount of information on existing apps. You can look at leaderboards, specific stats, and overall store summaries to delve into the mobile app landscape. Top App Charts, another consumer app analytics platform, provides detailed charts about recent drops or increases in different parts of the market, helping you pinpoint unfilled niches.

Top Consumer Apps
AppAnnie is probably the most popular app analytics tool, with over a million users. Because it collects vast amounts of data from its users, its sales and app revenue estimates are about as accurate as you can get.

In addition to gathering quantitative data, take a look at popular app forums to gather some qualitative data—what people specifically don’t like about other apps. You can read reviews to see where apps have gone wrong, or what consumer needs they fail to meet. With enough digging, you are sure to find some commonly requested features that you can include in your app.

Try these to get you started:

Don’t Give Your Consumer App Away for Free

A young developer named Andrew Hedges started a thread on Reddit asking about the profits that indie developers make from their apps. One mentioned that his app Aspect Ratio Calculator makes a few hundred a year, but he certainly doesn’t rely on it for income. Another—in typical Reddit fashion—suggested that the newbie app maker shouldn’t “quit his day job.”

The unfortunate reality is that the average app developer makes less than $500 a month. Why? Well, 90% of apps are given away for free.

While many sources will show that the highest grossing apps are free games—the sheer number of competitors in the free game category makes the success of this sort of app highly unlikely. Instead of trying to win the lottery with a free app, try to make your product something that people need and will purchase.

Takeaway: Charge wisely for your consumer app

ConvertKit founder Nathan Barry’s first app as an indie developer was OneVoice—a speech-generating app for people with disabilities, which he managed to make successful, in large part due to how he priced it. Because hardware offering a similar service typically costs over $300, the app creator calculated that the target audience would be willing to pay the steep price of $199—despite the fact that most paid apps go for about $1. He didn’t use the most popular approach. Instead, he found a price the was right for his product, and it worked!

Chris Savage, the co-founder of Wistia, has taken the less popular approach by using a “monetizing backwards” model, which means he first offered a paid plan, and only over time began to offer free versions of the product. He argues that if you are producing a quality product, you want to immediately set a standard for what the product is worth—you can always offer it for free later.

So how do you come up with that price? The folks at Price Intelligently make a great case for one of the most successful software pricing strategies in the game: value-based pricing. While you might consider using the “manufacturing” cost and the competitor’s pricing to construct your pricing strategy, CEO Patrick Campbell argues that this is too weak—you should really be evaluating the value of your product—that is, calculating what your ideal customer would be willing to pay for your service.

And that number can’t be static—after all, your product should be improving over time. As you add more features and your product increases in demand, you should adjust prices accordingly.

Always Use Protection on Your Consumer App

In 2014, Fandango was sued by the Federal Trade Commission for failing to protect the security of their mobile apps—an oversight that resulted in millions of users’ data, including credit card information and social security numbers, being compromised. While Fandango might be big and established enough to absorb the damage, your brand new startup might not be able to take such a hit.

Fandango

Ok, so what if your app doesn’t ask for credit card information, and probably won’t reveal anything personal about the client—can you get away with a shoddy security system, then? Absolutely not!

Weak security on your app makes it prone to malware that can ruin a user’s experience with your product. Just a few bad ratings are enough to dissuade many potential clients from ever even giving it a first try, even once you’ve fixed all the bugs. Not to mention that the cost of patching up this security hole will cost you 30 times more (PDF warning) post-product release than it would initially.

Takeaway: Build excellent security into your consumer app

According to Arxan Technologies, 40% of free apps and 92% of the top 100 paid apps can be hacked. And there are so many steps to securing your app—from encrypting data, to authentication, to anti-malware software—that many details often get overlooked, especially when the focus of your dev team is on creating a functional and unique mobile consumer app.

But, security is paramount, so you don’t want to risk fudging it up by doing it yourself. Instead, outsource this work to the experts.

Tools like Auth0, an identity-as-a-service product, are created by developers that spend all of their time focusing on how to keep your app secure and your user data safe. By plugging into these third-party services created by security experts, you’ll be able to bring your app up to the highest security standards just by dropping in a code snippet.

Spread the Word about Your Consumer App Through Targeted Marketing

In December of 2013, LykeStore launched their very trendy and “carefully curated” e-commerce app. Investors had high hopes, boasting their slogan “The Beginning of Anything You Want.” They had a huge marketing budget— a lot of which was spent on an extravagant launch party—but because they focused on the wrong type of marketing, the app went unnoticed, getting less than 100 downloads in the Android market.

we're closed

If the man who wasted $600,000 on bad ad campaigns has taught us anything, it’s that a big budget doesn’t go far if you’re not strategic.

Takeaway: Use smart social media targeting

In this day and age, you should never underestimate the power of social media marketing. 19% of iOS apps and 15% of Android apps are discovered through social media platforms.

wally

But mastering Facebook Ads is especially tricky. Facebook enables you to target users by demographic, geo-location, and by accessing device. Most people don’t take advantage of its targeting capabilities, so their ads show up in the wrong places and are seen by the wrong people.

The look and message of the ad are also extremely important. The ad example below shows a successful mobile-only ad with a “Download” button that takes you directly to the app store. The short headline, the clear and succinct slogan, and the call to action all send a very comprehensible message. Do some research on the most effective words to use in headlines and link descriptions (because it matters more than you’d think!)

breather

Some ad optimization platforms, like AdEspresso, let you take demographic targeting and optimize it further via A/B testing and other optimization techniques. This way you can make sure that you’re spending your ad budget on people who are the most likely to click that “Install Now” button.

Get Your App Users to Stick Around

In 2013, Homejoy seemed to be made of the stuff of unicorns: an Uber-like system, a necessary product, and an easy-to-use app. This app, connecting cleaners and homeowners, performed fantastically the first year, and then ultimately flopped because of the high customer acquisition cost.

To get people to use the product, they offered heavily discounted cleanings for just $19.99 to thousands of people, who, after learning their standard price, never used the product again. Swallowing these costs, the company drowned in lawsuits while trying to keep up customer acquisition and reduce churn.

Studies have shown that apps lose about 40-60% of their users in the first session after downloading. There’s no point in concentrating all your energy on customer acquisition when you’re at such a high risk of losing those customers.

Takeaway: Concentrate on user retention

In order to make sure your consumer app will survive, you have to concentrate on constantly updating and improving your app to keep customers interested. The best way to do this is to use analytics platforms to learn about your audience and how they are interacting with your app.

Platforms like Amplitude offer real-time behavioral analytics that you can use to pinpoint the most popular features of your app and to whom they appeal to the most. This will enable you to get rid of the dead zones, and ramp up the features that you might have been underestimating.

consumer app graph

And every time you update your app or add a new feature, let your users know! Otherwise, they’ll get bored and move on. You can use a tool like Appcues to prompt your users to engage with the newest (and more relevant) parts of your app. Your email reminders and push notifications will be sent to the users whom the update affects the most, without annoying users who take advantage of other functionalities of your app.

Don’t Doom Your Consumer App with Rookie Mistakes

You’ve already built a solid foundation for a successful mobile consumer app—your great idea. But bringing your idea to life is more than just outsourcing the dev work, and delegating tasks. It takes some careful planning, strategizing, and even testing (each company is different!).

While creating your app, you will face countless obstacles, and, with the success rate of mobile apps dropping to under 1%, you can’t afford to make these rookie mistakes. You have to pay attention to these five key details, because if you miss even one, your app will join the countless others in the consumer app graveyard of great ideas.

We’d love to hear about what you did to ensure the success of your consumer app, or any lessons you learned throughout the process in the comments. Who knows? You may even get featured in an upcoming article!

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Vinay Patankar

CEO of Process Street. World Traveler, Seasoned Hustler, Tech Entrepreneur, Fitness and Food Enthusiast. Youngest Cisco Engineer in Australia. 3rd Internet Company. Find him on Twitter, Google+ or his Blog


2 Comments

Vinay this is EXACTLY the kind of article I’ve been waiting for.

I’ve had an app in mind for my biz (later on) and have been researching about app creation for a long time with this in mind.

Thanks for a brilliant resource and guide – I’ll be referring to it often and following the links to find out even more.

Thank you!

I’m definitely sharing this with my Twitter followers too.

Lyn Bowker
SYDNEY


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