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No article can tell you exactly how to make a viral app. That's where your team's creativity comes into play, as well as advice from experienced developers and marketers.
However, when studying successful apps, you can observe a set of viral principles, and you can apply these principles to develop your own strategy. Let's dive into these principles now.
It is possible to spread garbage virally on the Internet. We receive many requests from people asking for a "rip-off," or an "app just like [popular app name]."
Users are more likely to call these apps spam. Users quickly delete spam apps before developers have a chance to make a few pennies off advertisement views, let alone a few dollars from in-app purchases. Spam apps don't retain users well, and they don't "convert" users into paying customers. So while you may have virality, your company won't experience real growth.
A great product provides unique value to users that is in some ways superior to any other offerings on the market. It's expensive and time-consuming to produce products like this, and it requires more risk-taking and creativity. But creating unique value for users with a truly great product is the most solid foundation for sustainable viral growth.
To start the ball rolling, you need some source of traffic. If you invent a product that is original enough, tech blogs or social media influencers will be interested in sharing it with their followers. If you invent a "normal" product, you might have to buy that initial push by running Facebook ads or paying an influencer for a shout-out.
It's not enough to get downloads. You need users to truly engage with your app before they'll even consider sharing it with their friends. Your app's engagement strategy includes a few key parts:
Facebook and Yelp both make it ridiculously easy for users to take action. Think about how quickly a user can open Facebook and start reading posts and seeing pictures. Think about how quickly a user can open Yelp and look up a type of restaurant. If your app requires too many steps for users to take action, they won't bother. The best apps require less than a second of effort before a user can get what they want.
To reward users, think about one or more events that could make the app experience satisfying to the user. For example, casino games usually give users a few "big wins" early on. Users become accustomed to the dopamine rush. When the game stops giving "big wins," players start to desire in-app purchases so that they can bet bigger and continue winning big again.
To keep users engaged, think about a way that the user can invest in your app or game. When a user pins photos on Pinterest boards, they become more invested in the platform, because it now holds their boards. When a user adds movies and TV shows to their Netflix playlist, they become more invested in Netflix's platform. The next time they're ready to watch a show, all they have to do is press play on one of the items they've already selected.
You can build these elements into any app to create a strong user engagement strategy.
Most apps today have sharing mechanisms. What separates ordinary apps from high-performing ones is the reward that the app gives users for sharing, and the timing of the offer.
Match-3 games often reward users who login through Facebook with bonuses that help them solve the game's puzzles. Some utility apps unlock features for free when a user shares the app on social media.
If you can time your offer to a point in the game or app when the user will really care about unlocking the reward, then you're much more likely to see a great conversion rate.
Most people only use about 30 apps on their phones. When people download a new app, they usually enjoy it anywhere from 10 minutes to a couple weeks. Then they delete it or forget about it.
If you have an app like this, then you're leaving a lot of unearned revenue behind. As an app publisher, you spend time or money to acquire every user. The least you can do is make a modest investment in your app's retention strategy in order to keep the users you workd so hard to acquire.
A successful business should aim to keep users not only engaged, but also paying, on a monthly basis. Consistent revenue will keep your business healthy, and enable you to continue investing in new product features and marketing to acquire new users.
Start with the goal of getting users to pay $9.99/month for your app. Is there anything you can offer that would motivate people to pay $9.99/month?
Usually entrepreneurs find that they need to offer far more than they initially imagined in order to convert and keep monthly subscribers. Take the offer you have in mind, and multiply it by 5 or 10, and you might have enough value to reach the tipping point where subscribers will pour in.
Consider Netflix, one of the fastest growing companies of the last decade. Netflix retains so many subscribers, and attracts new subscribers, because they offer an enormous library of quality content. Even if a subscriber only watches one or two TV shows each month, they'll get enough value from the service to keep the subscription. And when they finish whatever they're watching, they can easily find something new to watch next.
If you cannot come up with a viable subscription strategy for your app, then the best you can do is offer in-app purchases (coins, bonuses, or locked content) and show advertisements. You'll receive far more in-app purchases and show far more ad impressions if you combine these strategies with mechanisms to get users to open your app on a daily basis. Casino games, for example, often give users a coin bonus each day that they open the app.
You'll see how all of these techniques work together when you calculate your app's Viral Coefficient.
The Viral Coefficient = (number of invitations that an average user sends out) x (the rate at which new users download the app after seeing a post by a friend).
If your average user shares their activity in your game with 10 people via a Facebook post, and 15% of the people who see her post download the game, then your Viral Coefficient = 10 x .15. This means a viral coefficient of 1.5.
If this process is repeated just once daily, the compounding effects over time will be enormous. Think about 1 user turning into 1.5, turning into 2.25, turning into 3.37, turning into 5, turning into 7.6. In just 5 days, with 5 repetitions of this cycle, you have grown from 1 user to 7... all without paying any extra to reach the 6 new users, since the users shared the app with their friends in a self-sustaining viral loop.
On a per app basis, subscription-based apps generate more revenue than any other business model.
The key to a good subscription business is to offer buyers ten times more value to “rent” your service than they could get if they were to “buy to own” a similar product. If Spotify and other music services only offered 1/10 the song library, many subscribers would opt to invest in their own song libraries rather than pay a subscription fee. Instead, music streaming services offer more value than users could hope to buy, making it easy for users to stay committed.
Subscription services usually start with a large library of content. The content can be text, video, images, or interactive experiences.
The cost to build this content can be substantial. However, sometimes people already have substantial libraries that could be leveraged with a subscription model. Many bloggers have hundreds of posts, many YouTubers have hundreds of videos, and many Instagramers have hundreds of photos.
If you're sitting on a library like this, you could use it as the foundation of a subscription app. For example, if you have a YouTube baking channel, and your advertising earnings are dwindling, you could potentially make your videos unlisted, then launch a subscription app where people can enjoy your recipes and baking instructions for a small monthly fee.
If you don't have a library like this, you could find great content online, think of ways to package them into apps, and reach out to the content owners to inquire if they would be interested in a joint-venture. In a joint venture, in exchange for using their content in the app, you would pay monthly royalties on the revenue that the app produces.
If you have another subscription business in mind that cannot easily be produced using an existing content library, you can also either get to work building a library of content, or pitch to investors for seed funding.
In-app purchases are the second best way to monetize apps. Most apps monetize with in-app purchases, since they work well for games and utilities that users would not be willing to pay a subscription for.
With this model, users can download the app for free. Once they are engaged with the app, then they can pay extra for "coins," "boosts," or other locked content. High-grossing apps typically give users a satisfying experience, then slowly teach the user how "coins" or other purchasable content would help them. Developers offer the in-app purchases strategic point in the game or app experience when the user will most want to buy. If the user doesn't buy, great apps will often present a pop-up window at a later time with a 50-80% discount and an expiration time of 2-minutes. This way the user can buy in-app purchases at a heavy discount, so long as they act fast.
Most in-app purchase revenue comes from “whales”—customers who spend $50 or $100 on a single in-app purchase, and who might even buy multiple in-app purchases at this price point. Other customers will buy in-app purchases for $1.99 or $3.99. Most users will not buy anything, and this is ok, since your app’s “whales” will make up for your more frugal users.
Similar to in-app purchases, some apps just charge the user upfront for the app download. The best times to charge for an app upfront are when you know that users will have a high emotional response when they see the app, or users are already committed to buying the app when they see it, triggering an impulse buy.
If Cards Against Humanity released an app, millions of fans would pay upfront, no questions asked, because they love and trust the brand. With this kind of user devotion, why not lock in the sale right away? Similarly, Disney often releases paid apps, because they know they can count on parents buying the apps for their kids, whereas it's less certain that parents would be willing to buy in-app purchases so that their kids can get more out of an app that they already have.
Finally, ads are the third best way to monetize apps. Usually an app will show ads in addition to in-app purchases, in order to earn extra income from users who will not buy anything.
Some app developers have a strategy that is almost entirely focused on earning money from ads. This is a difficult strategy to pursue, since it is essentially arbitrage: You aim to acquire users at a lower price for your app. Once they are inside your app, you get them to click on an ad for another app. Then you hope that the other app developer will pay you more for the user than you spent on the user in the first place.
An advertising-only strategy sometimes works because of the marketing strategy differences between independent app companies and large corporations. App corporations like Zynga have more automated campaigns. They are willing to bid $3, $5, even $10 for a user, because they know that their app will generate more than that off the average user they buy with their ad campaigns.
At these payment rates, delivering only 10 installs per day can create a decent passive income. But you still need to get users into your app. Fortunately, it is possible to acquire users for as little as $0.10 using strategies that wouldn't make sense for larger companies. Acquiring cheap installs like this usually requires working daily to optimize your ad campaigns, and bidding low (which usually results in very few installs).
Most developers who focus on ad revenue end up with an app that earns $10-50/month. Their apps don't retain users very well. Their cost per install becomes too high. And advertisers end up choosing to advertise in higher-performing apps. For these reasons, it's best to consider how you can build a quality app that will either sell subscriptions of in-app purchases that users will actually want to buy.
Reskinning is the process of buying an app template, editing the graphics, and publishing the finished app to your developer account.
You can buy templates for apps on Chupamobile.com, SellMyApp.com, CodeCanyon.net, and other places around the web. Chupamobile features years-old quotes by Yahoo and Wired to lend legitimacy to their services. But there are a few critical problems with reskinning.
Apple banned the use of app templates in early 2017. The updated App Store Review Guidelines state:
"4.2.6 Apps created from a commercialized template or app generation service will be rejected."
The App Store Review board began removing apps made with templates from the App Store, and rejecting new apps that were derived from templates. They also began rejecting apps that mimicked the content and functionality of other apps without adding significant new value to the App Store. Apple considers these types of apps "spam."
Currently Apple is primarily targeting casino apps and other highly saturated niches, but their policy covers all apps on the App Store, and it’s likely that their enforcement will become broader over time once they finish cleaning up the categories with the most offenders.
To comply with Apple's anti-spam policies, you simply need to create a quality product that adds value to the App Store by contributing new content and functionality that users can't get from existing apps.
The vast majority of templates are poorly-made rip-offs of popular apps. They often capture the basic gameplay or features of the original app. But they usually lack features that are key for user acquisition, on-boarding, activation, retention, virality, and monetization.
With the high cost of user acquisition, your app needs to be a well-oiled machine designed to convert users into profit. You cannot afford to acquire users at $0.50, then drop the ball when it comes to turning that user into a profitable user.
While a small percentage of users on the App Store may use your reskinned app, the vast majority of users opt to use higher-quality original apps.
There are a lot of benefits going for original apps. They often have 100+ reviews. They usually rank higher in search results. They have positive buzz online. Instead of being produced on a $500 budget, the seller invested $2,000+ in producing a quality product.
While there are a few high-quality templates available online, the vast majority will not produce good results.
Many people start with reskins because it seems like a way of testing the waters with app development. Or they've read about Lean Startup theory, and decided to make an inexpensive minimum viable product. But a minimum viable product is only good if it is actually a viable product. Most reskins are not.
App templates may appear to reduce costs in the short term by producing an app for a dime on the dollar. But even with the small development cost, you’re unlikely to make a positive return on investment. Instead, you’ll likely lose time, development money, marketing money, and motivation.
Consider the value of producing a high-quality original product that truly excites and engages your customers.
Many development blogs suggest that it is possible to achieve passive income with apps, but they often leave out or gloss over the steps involved to achieve this.
There are three ways that you can approach earning passive income. The first approach is to rely on customers to discover your app through organic App Store searches. The second approach is to use outside marketing to attract customers interested in your product. The third approach starts with marketing, and ends with just organic traffic.
Roughly 50% of app downloads occur from users searching the Apple App Store or Google Play Store and downloading apps that look good to them. You can capture a large volume of downloads and revenue by relying on this organic search traffic, providing you follow a few steps:
There is usually a correlation between the quality of the app and the quanitity of weekly passive income. With the no-marketing approach, we've found that a $3,000 app investment often yields $20-30/week from App Store downloads, while a $10,000 investment can yield over $200/week. In either case, the payback period often stretches for 1-2 years.
The other 50% of app downloads occur when users find an app on social media or in an advertisement, and then they install the promoted app.
While there are hundreds of platforms, a few methods account for most downloads:
If you set up a way to automate your marketing, you can usually achieve much higher weekly earnings than with the no-marketing approach. This can make the difference between an emoji app that earns $100 weekly profit versus $20 weekly profit.
Another approach is to use marketing for a powerful return during the first few months of your app's release. During this time, you can recoup your development investment, generate user reviews, and increase your rankings on the App Store.
After marketing your app for a few months, you'll likely experience diminishing marginal returns from advertising. This is because those who saw your ads and decided to download your app will have already downloaded it. So the population of new customers shrinks as you continue marketing.
To maximize profitability, monitor your install costs, and cut off marketing channels once the cost per download gets very close to the revenue per download. From here, you can allow the app to generate passive income from the users who discover your app each week by searching the App Store. You'll also benefit from the network effect as users share the app with their friends.
ASO (App Store Optimization) is the process of refining key variable that affect your app's downloads. Your downloads are influenced by your ranking in App Store Search results, as well as your app listing, which a user views while deciding whether or not to download your app.
More than half of downloads occur through organic search (users finding an app by searching the App Store). Because of this, ASO is very effective way to increase an app's downloads and revenue.
Several factors impact your app’s ASO. Let’s break them down.
Your app icon is the single most important visual element that determines whether a user will tap on your app or continue scrolling to see more apps.
Users love an icon that pops visually. A great icon usually has:
Because icons are small, it's best to show a character's head and shoulders rather than their whole body. If you use multiple elements in your icon, make sure that one stands out as the most prominent.
The best way to come up with icon ideas is to search the App Store for other popular apps in your category. Apps that rank toward the top of search results typically have the best icons, since they're produced by well-funded companies that test icons (and other elements) extensively.
Because of your icon's outsized importance to your app's performance, it’s worth designing 3-4 alternative icons, sharing the icons with potential users, and asking people to pick the best one.
As a user scrolls through search results on the App Store, they see 4 elements for each app: an app icon, the app’s first two screenshots, an app title, and an app rating.
Users often stop scrolling if they see an app that has visually appealing screenshots that suggest the app will meet their needs.
A popular approach is to put the real app screenshot inside a mockup phone, and add text above the phone. In each screenshot, the phone demonstrates a different key feature, and the text above the phone emphasizes that feature.
Consider doing something out of the box. For more information and ideas, check out this extensive guide by AppShots.
An app title should concisely convey the app’s purpose. For games, a title usually works if it is catchy and echoes the app's visuals, like "Stick Hero" or "Jelly Jump."
Apple allows up to 30 characters, but it's best to limit the title to 2-4 words. This makes it is easy for people to remember and share. It also ensure that your title will fit on its App Store listing, instead of getting truncated with ellipses ("...").
Many users gauge an app’s popularity and quality by glancing at the stars underneath an app’s title. Given the choice between an app with a hundred ratings or one with a handful, most users will download the app with more ratings. For this reason, it’s best to preserve app ratings when submitting updates, unless an app has very bad ratings for a particular version.
The best way to get more ratings is to use Apple’s ratings prompt. The popup automatically determines when to display, so there is no need to configure custom settings. On the Internet there are still many scripts for custom ratings prompts, but Apple has now banned people from using other systems. Fortunately, Apple's SDK is more effective at getting ratings anyway.
A good app description is 4-5 paragraphs.
Paragraphs can be 2-3 sentences so that they're easy to read. It’s also a good idea to use bullets to quickly highlight features.
Avoid using the word “free” in your app description (or anywhere on your app listing), since Apple now prohibits this.
Apple allows you to attach 100 characters of keywords to your app. The keywords should help users find your app, even if they don't search for a word that's in your title.
The best way to decide what keywords to use is to search the App Store for similar apps. Make a list of words in their titles, and also note the suggested keywords that Apple displays. Try tapping some of suggested keywords to see additional apps, and note the words in the apps' titles.
Next, go through your list of potential keywords. Think about what keywords people are most likely to use when searching the App Store to find an app or game like yours. Add these words to the keywords section of your app’s record. Separate the keywords by commas, but don’t add any spaces.
One of the biggest overlooked factors of ASO is an app’s open rate. Apple tracks how often users open each app on their phone. When an app only gets opened once or twice, Apple likely figures this into their App Store search ranking algorithm.
No one knows Apple’s search algorithm, but evidence suggests that higher quality apps with good open rates get preferential treatment on the App Store. This makes sense, since Apple wants people to find the apps that they’re most likely to use on a regular basis.
The best way to optimize your open rate is to make your app or game as sticky as you can. Deliver the value and features that users are looking for. Add push notifications to get people to re-open the app each week. If you have a game, add multiple levels and unlockable characters to make the game worth playing on a regular basis.
Apple likely tracks the rate at which users delete apps on their phones. They could easily use this metric to push bad apps further down in App Store search results. This provides an extra incentive to build a high quality app, because your app's quality actually impacts its rankings on the App Store.
Users often delete apps that show too many ads or don’t deliver enough value. The best way to make sure users don't delete your app is to conduct in-person tests with potential users. One way to do this is to ask someone at Starbucks if they would test “your brother’s app” and give their honest feedback in exchange for a free drink.
Localization is the process of translating your app's information for use in other countries.
You can either:
In our experience, partial localization usually achieves the best ROI.
To understand why, put yourself in the position of a consumer in another country. Imagine that you're a native Japanese speaker. You've searched the Apple App Store for パズル ("puzzle"). As you scroll through search results, you find many apps with titles in Japanese. You see some apps with titles in English. Which app are you more likely to check out?
While many people in other countries can read English, many are more inclined to download an app that uses their native language in its app title, app description, and on any descriptive text used in app screenshots.
You don't have to take our word for it. According to the consulting firm Common Sense Advisory, 72% of global consumers prefer to use their native language when shopping online. Meanwhile app analytics firm Distimo found that typically, once an app is localized, its weekly download volume more than doubles.
When you partially localize for 10 languages, a typical cost is $15 per language for translations plus 1 to 2 hours of a developer's time to add the localized metadata to the iOS App Store or Google Play Store.
If you work with Wharton Apps, this comes out to $150 in translation costs + $35 in development costs, for a total of $185. This cost is minuscule compared to the extra revenue you stand to gain by positioning your app to succeed in 10 extra markets.
Full localization is much more expensive because it involves adding substantial new information to the app's source code.
Fortunately, once users have downloaded an app, it often doesn't matter to them whether the actual app is fully localized. It's easy enough for users to navigate an English app because most buttons are either graphics or simple English words like "Share," "Start," or "Game Over."
Since full localization costs much more money, and it isn't that important to users, we don't recommend it for most apps.
We enlist the translation expertise of OneSky's international translation team. OneSky specializes in translations specifically for mobile apps.
Your app's description is the biggest expense, because it involves more words than your app's title or other metadata. To constrain translation costs, we reduce your app's description to 5-6 sentence. We also only recommend localizing for the top 10 languages, as measured by app revenue by country. In order, these languages are:
After your app's metadata is translated, you might want to go even further by fully marketing your app in one or more foreign territories.
The United States, China and Japan account for more than half of all worldwide app revenues, so these markets are the most valuable to target. If you have an app that is successful in the United States, it may be worth hiring social media experts in China or Japan to market your app in these territories to double or triple your app's revenue.
Many developers target the United States and all but ignore the other two huge markets. By investing just a little marketing effort in China or Japan, you might get surprisingly big results.
Users conduct far more Google searches than App Store searches, so it makes sense not to neglect this key source of traffic.
Leads from a simple website are as close to free as you can get. With free and nearly-free tools available, it's easier than ever to put up a landing page to draw traffic from Google, and direct interested visitors to your app.
You can put up a basic landing page in a few hours. WordPress is perfect for web development work without any advanced coding. There are numerous WordPress themes specifically for promoting apps. ThemeGrill currently offers a great free theme called SingleApp.
So what features does your marketing website need?
For a great example, check out the landing page of Filterra, currently one of the highest-ranking photo apps on the App Store. Their site demonstrates all 4 essential features that you should include.
A headline should quickly tell users the purpose of your app in 3-5 words. If you can't fit an idea into 3-5 words, ask a friend for advice or surf the App Store and see what headlines your competitors are using. You can often get away with a twist on popular headlines.
Underneath your headline, write 1-2 sentences to elaborate on your app concept. Keep this text simple.
Finally, underneath this, put a button linking to your app. This way, if customers are already sold, they can easily download your app without reading any further.
A photo catches the web visitor's attention and visually reinforces the headline.
Usually a photo depicts an exciting moment from a game, shows off your app's screenshots, or shows a person using an app. Not sure which one would fit best for your app? See what apps are performing well on the App Store, search Google for their app titles, and see what they're using on their websites.
Now that you've seized the web visitor's attention, you can tell them a bit more about your product to develop their interest. There are a few ways to do this.
Probably the most common approach is to simply highlight 3-5 of your app's features. Show 3-5 photos. Under each photo, include a headline and 2-8 sentences describing each feature. If you're offering an entertainment app, and you write too much about your features, most people won't read it, since they're only on your website for fun. However, if you're marketing a business app or utility, your customers might want more detail about each feature.
Another approach is to call out specific customer segments. If your app is for sports fans, you can show 3-5 photos of different sports fans using your app, to illustrate how your app can be relevant to basketball fans, football fans, and soccer fans. Under each photo, write a headline and 2-3 sentences.
You've grabbed your web visitor's attention and developed their interest in your product. Now it's time to tell them how to take action.
The final component of a strong landing page is a call to action and a link to download.
A call to action should remind your customers what they will get from downloading your app. Filterra's call to action currently reads: "Get Started Now! Download for FREE and jump straight into perfect photo editing!"
Beneath their call to action is the App Store badge, which links to their app. Filterra used a white version of the App Store badge, so that it would stand out against a black background.
You can link the download buttons directly to your app. Or, if you have extra time, you can create smart links. Smart links enable you to track when someone clicks on your website's links. This could come in handy if you want to make changes to your website, and track how the changes are affecting your conversions (instances where users click the app link). A simple resource for creating smart links is OneLink by AppsFlyer, although it is a paid service.
Before you consider whether to add new features, first take action by building a simple website with the 4 essential features.
Once you have a website live, you can continue reading. The list below will outline some common features that can add to make your web presence even stronger.
The four essential features are fundamental. You almost certainly should include these on your site.
Don't view the optional features as a checklist. You should only include features that your users will actually care about. If you can't imagine anyone visiting a page, leave it out. If you personally would get bored reading your website's text, shorten it. If you think of something else that your users would enjoy, add it.
Draw inspiration from other app landing pages in your niche. While you can throw up a website in 4 hours, you can work on improving it over the course of a week. Start by launching a simple page with the basic features. After it's live, you can expand from there.
What actions should you take to market your app?
It’s difficult to know, since there are so many possibilities, and a lot of individuals and companies claiming that they can achieve amazing results for you.
Part of the reason there are so many marketing techniques is that different types of apps work well with different marketing strategies. Also, even within the same app category, what works well for one app may not work at all for another.
There are two certain things that will make marketing much easier.
First, make sure there is a base of customers who want your app. Get to know that base by researching groups on Facebook or Instagram that they belong to. Investigate their interests by using Facebook's Audience Insights tool.
If you're building a utility app, talk to people in your daily life. Ask them questions about their frustrations or challenges, and ask them if they would use an app like you propose to solve these problems.
If you're building a game, read the reviews that users posted on similar games on the App Store. Consider ways to ensure that your game can address their complaints, while keeping the game elements that they enjoy.
Apple features outstanding apps on the App Store every day. There are also blogs and social media accounts dedicated to helping users find cool new apps.
To get featured on the App Store, you need a top-notch app and a meaningful story about the app's creation. Apple invites developers to "tell us about yourself, your app’s unique features, and your inspiration for creating this app" in 1,000 characters or less.
Later, you can reuse this story to add an interesting angle for a journalist, blogger, or social media influencer when you share the app with them.
If you don't get free coverage, you still have opportunities to market your app without paying a cent upfront. Many social media influencers are constantly on the lookout for great products to share with their millions of followers in exchange for a revenue share. If you create an amazing app, and offer influencers a revenue share, many of them will eagerly accept your offer and put the app in front of their massive audiences.
After you've conducted market research and built a quality app, decide on 2 or 3 primary marketing strategies.
Why 2 or 3 strategies? If you focus on too many strategies, you can easily get distracted by new marketing methods, instead of dedicating the time to make the strategies you chose work. On the other hand, if you only use 1 strategy, you might end up wasting a lot of time in the event that that the strategy just isn't a good fit for your app. 2-3 strategies gives you the right balance of focus and risk-mitigation.
Read these articles for inspiration and ideas:
If you'd like to try paid advertising, Carter Thomas's $27 course on Facebook ads has helped many app developers launch profitable campaigns. Chartboost also offers a great free walk-through on setting up advertising campaigns for games.
Before you start investing in ads, however, do what you can with free marketing or revenue shares. Usually it's enough to get a good app moving, and you won't have to take on any financial risk.
A great startup concept should appeal to a large market with a product that exhibits economies of scale. A large market ensures that you have room to grow. Economies of scale help you become increasingly profitable as you grow the business. Economies of scale also help you invest more money into the business. You can use this money to market to new customers, and to make your services even better so that you can improve customer retention.
Netflix appealed to an extremely broad market–anyone who likes movies or TV and is tech-savvy enough to feel comfortable streaming. They also achieved economies of scale, since the cost of providing their streaming service was not significantly larger for each new member who signed up. Netflix utilized the savings from the economies of scale to market to more people, and to make their service better. They bought higher quality content, more diverse content, and even commissioned original shows that they knew their subscribers would like. Eventually Netflix became so good that it became hard for smaller companies to compete, securing a competitive advantage that stops many new entrants from trying to take away their market share.
If there's one metric that venture capitalists and business owners care more about than anything, it's profitable growth. When a business starts, there's a great deal of opportunity to achieve rapid growth by taking marketshare.
Consider what will happen if your startup grows at a weekly growth rate of 1% versus 2%.
If you have a bigger vision for your company, or investors depending on your success, then it can make a huge difference if you commit to an even faster growth rate at 5% weekly growth.
Y Combinator recommends that startups choose a weekly growth target and stick to it. Somewhere between 2% and 5% is a reasonable target for many early-stage startups. Your target will depend on many factors, such as the number of contractors or employees working for you, the size of your market, the quality of your product, and the effectiveness of your viral marketing campaigns.
In the beginning, maintaining your chosen growth rate will be a matter of selling and scaling. You can use your growth target to make many decisions. For example, should you go to a conference, should you hire a programmer, should you hire another sales associate, etc. The two biggest factors that you will likely want to prioritize above your growth target are ethics and profitability. If you build a company without ethics, eventually you'll lose credibility. If you build a company without profits, then scaling rapidly only drives you into the debt faster. (Some companies choose to stay in debt for a long time, but they
Eventually, your market will become saturated. To continue growing, your company can:
If your company can keep breaking into new markets at a similar rate of growth, your company will soon make a large impact on a national or global scale.
Ben Silbermann, co-founder and CEO of Pinterest advised entrepreneurs: "Don’t take too much advice."
Often people hear advice, remember it, and apply it to the wrong situations. It's important to understand the context of any advice your hear, and carefully decide whether it's applicable for the business decision you're making.
Make sure that you're not falling into any of these common traps.
Have you heard the advice, "Don't put all your eggs in one basket"? It's useful to remember when buying stocks to make a stable diversified portfolio. But it's less applicable if you're building a new organization.
By all means, start your business by considering 10 ideas. Get customer feedback on all of them. Research them, and get advice from other business professionals on what you should pursue.
But after this point, choose one idea to focus your energy on. Risky? Yes. The concept could fail. Then again, you can always adjust it later on.
If you're focused on too many ideas, however, you might not have the time or energy to adjust your idea. Instead, when it fails, you might end up moving on to a whole other idea. This is the reason that, for most entrepreneurs, focusing on multiple projects just results in a bunch of weak products.
Today all app categories are saturated. Over the last 10 years, developers have published over a million apps on the App Store. The App Store doesn't need 10 new apps. It needs one great new app that will blow people away.
Pick your best idea, and do everything to make it work.
This is an easy mistake to make, since a startup's end goal is often to appeal to a mass market of diverse people, and to have a big complex app like Facebook.
But it's important to remember that every big app started by targeting a small group of people, and that every big app also started with a much smaller set of features than what we're used to today.
In the beginning your company has to appeal to a small market of early adopters. Your product needs to perfectly suit their needs and interests, so that they'll pick your app over competitors. Once you corner a small market, you can expand to other small markets, and then go after a big market.
Likewise, in the beginning your product has to be simple and easy to use. Once people get used to the main features of your app, you can add new features, and users will learn how to use the new features over time.
Apple uses secrecy to launch innovative products before their competitors and to build anticipation among their fans. This approach works well enough for them that they continue using it. But it's not a good model for most startups, because of the very different circumstances an average startup faces.
Firstly, an average startup doesn't need secrecy like Apple does. People generally copy ideas from successful businesses like Apple, not unproven ones like your average startup. Secondly, an average startup's new product is not going to generate the massive customer interest that an Apple product launch would.
Still, why compromise secrecy?
In exchange for secrecy, you get an important tradeoff: feedback. For most startups, feedback is far more valuable. Once you accept a loss of secrecy, you can now easily get feedback from people in various demographics who might become customers, people in your area of business who might become key partners, people with experience and advice who might become investors, and smart capable people who might become co-founders.
Can you get feedback without compromising secrecy? You could use nondisclosure agreements, but NDA's will significantly reduce the level of feedback you receive.
Most startup companies are not nearly as secretive as Apple, if at all. They test products constantly. They get advice. They change business direction.
So consider loosening up on secrecy, and getting as much feedback as you can on your business model. The last thing you want to do is be so concerned with sharing the big idea you think you have that you miss the actual big idea that others can help you uncover.
Choose a co-founder with complementary skills and a good work ethic. If you don't know them well, talk to their previous customers, business partners, and mentors.
Next, make sure that co-founder's shares vest over time as they work with you. This is essential, in case something goes wrong later on. Even if you choose a great person, there's always the possibility that they'll lose interest, their skills won't match with the new direction of your company, that they'll have incompatible views. If you've seen HBO's comedy Silicon Valley, you can probably think of a few other reasons why it's essential to have shares vest over time.
Steve Jobs claimed that Apple didn't do market research. He famously explained, "A lot of times, people don't know what they want until you show it to them."
Without context, this is a dangerous example to follow. Apple was inventing entirely new product categories, which could be difficult for new customers to fully understand. Apple also had a massively expensive internal feedback process that was doable for a multi-billion dollar enterprise, but would not be practical for most businesses. Finally, Steve Jobs was a genius who learned from a lot of experience (including some expensive failures).
If you've ever found yourself frustrated by an Apple product that you wish existed, or an Apple app that you find frustrating to use, then you could argue that Apple's lack of customer feedback is still problematic.
Most businesses are very different from Apple. Most companies aren't creating new product categories. Most companies can't afford Apple's internal design processes. And most companies don't have Steve Jobs.
Given these different circumstances, it's highly unlikely that you won't benefit from customer feedback.
You can usually benefit by analyzing the choices that your competitors make. Perhaps some of their choices will be a good fit for your customers.
But it's unlikely that your customers want the same app that your competitors offer. Otherwise, why wouldn't they just use your competitor's app?
Focus on your customers more than your competition, and develop the features that your customers are interested in.
You've probably heard the startup mantra, "fail fast." How does that reconcile with the more popular mantra, "don't give up"?
"Fail fast" doesn't mean that you should give up on your business! It means that you should find the weaknesses in your business model as soon as you can, so that you can adjust your plans. After failing fast many times, you might end up with a new value proposition, new set of customers, new distribution channel, and more.
Perseverance is about overcoming failure, not ignoring it. You will fail with your startup. You'll probably fail repeatedly. If you take a long time to recognize those failures, you might run out of time or money.
Don't run out of time or money. Instead, fail fast. Recognize when something's not working, research the problem, develop possible solutions, and try some of the solutions.
The history of Instagram is a great example of a company that failed fast, and didn't give up.
Wharton Apps started small. No funding, no customers, and no experience.
Over the course of 2 years, we scaled by working on increasingly larger projects, diversifying our offerings, reading, sharing knowledge online, networking with hundreds of people interested in apps, and continuously learning from all of our experiences.
Do you have a vision for an app, but not enough money or experience to make it happen? We'd like to encourage you to persist with your goal. More than that, we'd like to provide a suggested roadmap for how to start a business with virtually nothing and scale up.
Of course there are many ways that you can start a business. This is just one suggested path for anyone looking for advice.
You can learn niche technical skills on Udemy.com. Courses are usually discounted to $10. If they're not on sale, wait for one of Udemy's weekly sales.
You can learn WordPress, Unity app development, iOS or Android app development, and much more. Many courses have over 50 hours of training videos, as well as access to instructors. Instructors are usually very responsive in order to maintain high ratings. Choose a course that has a high volume of students and a high star-rating. You can also watch course preview videos to gauge what instructor will be easiest for you to learn from.
Avoid courses that teach marketing skills, or that advertise massive financial returns. There may be many legitimate marketing classes, but unfortunately the category is weighed down by classes that promise a lot but fail to deliver techniques that work. (Often 1-3% of students will have great results, but the other 97-99% will not be able to replicate a marketing guru's results.)
Instead, take a class that teaches design and technical skills. You'll learn valuable skills that you can use to build your own app, or build apps for other businesses.
Apple apps generate nearly twice as much revenue as Android apps. For this reason, we recommend concentrating your business on iOS apps.
If you decide to produce apps for the Apple App Store, you'll need to do the following:
Follow along with the tutorials you purchased on Udemy to build your first several apps. Work on building apps for at least 10 hours a week. The average person spends 2 hours a day on social media, so if you're not sure where to get the time, consider deleting Facebook, Instagram, or Snapchat from your phone to help you focus on app development. Or, as Gary Vaynerchuk says, "Stop watching House of Cards."
A great way to get "small wins" is to keep your forward momentum is to sell the apps you build on Flippa. Flippa is an auction marketplace for websites, apps, and domains. John Manning took this approach, and netted about $1,000/month while he taught himself how to code.
Check out some of his auctions and try listing your apps for sale in the same manner. Even if your early apps only sell for $100-300 each, the sales will give you some cash while you continue learning and building your skill set.
Once you exhaust the first tutorial your purchase on Udemy, you can buy another tutorial to learn more techniques. Try to find tutorials that teach you how the build the kind of apps that you're interested, whether it's VR apps, Unity games, or utility apps. If you want to try any marketing tutorials at this point, you can try following the advice in a couple marketing tutorials as well.
If you decide Flippa isn't for you, try putting together a portfolio of apps, and selling your services on UpWork or Freelancer. You'll keep growing as a developer as you help your clients achieve their goals, all while earning enough income to sustain living expenses in most parts of the world.
After 6 months, you should be much better positioned to make the big app that you wanted to build in the beginning.
There are a few possibilities, depending on the scope of your idea. You might have gained enough skill that you will feel confident producing the app or game independently. If your idea calls for a massive workload and many skillets, you should now be able to attract quality co-founders with complimentary skills. Or, if your idea really requires a large team to execute, you can begin pitching your idea to investors.
Your big app idea needs to be more than an app. It also has to function as a business, which means you have to decide how a lot of moving parts will work together to earn a profit. Try using the Business Model Canvas to organize your ideas.
Many of the assumptions underlying your business may prove incorrect, so it's important to interview customers, talk to experienced business professionals, and validate each part of the canvas. You can learn about developing your own business model canvas by watching these videos, reading this book, or taking this free online course.
The most important part of your business model is the customer segment and value proposition. Ideally, you should find a large group of people or businesses who are willing to pay money for a solution to a real problem. Utility apps, educational apps, and apps designed for businesses all have a strong advantage here, because they truly solve problems for customers who are willing to pay.
Games and entertainment apps solve a smaller problem (boredom) for a broad audience of people who might or might not be willing to pay for the entertainment. This is why producing games is a riskier business model. However, you can apply the Business Model Canvas to improve your results by scientifically targeting distinct groups of users. For example, you can target people who love golden retrievers with a game or emoji app featuring golden retriever puppies.
Don't skimp on research, and keep your ears open for what customers are actually saying. If you hear only what you want to hear, you could miss out on amazing opportunities, or even waste your time on an app that people never really expressed a strong desire for. Talk with people at Starbucks and outside. Comment and engage on social media pages and blogs that your customers are likely to follow.
A good app idea can be expressed in a couple of sentences. Try out different elevator pitches until you find the one that customers respond best to.
Finally, set your goals high. Plan something different or better than your competition. This is the best way to ensure that when you release your app, the world will pay attention and spend money on your product.
Before you jump into app development, it's a good idea get input from customers and businesspeople, and refine your plan.
If you are in the United States, see if there is an SBDC in your region. SBDC's (Small Business Development Centers) can provide free strategic advice as well as connect you to business partners, mentors, and potential customers in your community.
Search for your zip code on SCORE to find additional mentors. SCORE is a group of 10,000 volunteers, many of them retired business executives, who can also provide confidential mentoring.
If you're still in school, reach out to the Business or Entrepreneurship Department at your university, and ask if there are any programs that you can join to connect with other entrepreneurs in your area.
At this point, you've established a business producing and selling apps. You've developed useful skills for the industry. You've investigated a unique business idea, and connected with mentors and customers. You've bootstrapped your business on $700 (or less).
Now you're well positioned to build out the transformational app you have in mind.
How many Fortune 500 companies were started by a one-person team? How about tech companies?
From Bill Gates and Paul Allen, to Steve Jobs and Mike Wozniak, from Kevin Systrom and Mike Krieger, to Evan Spiegel and Bobby Murphy, most high-earning companies grow out of a team.
In the fast-paced tech world, almost any opportunity quickly becomes competitive. For any given app niche, usually several winners seize a very large market share, while the rest of their competitors earn a small fraction of their revenue. Given this reality, if you have high income goals for your business, you'll probably do better by combining talents and resources with one or more partners so that you can maximize the quality and competitiveness of your product and marketing strategy.
Investors don't put their money into one-person companies for the same reason. They know that it's very rare that one person has the time or capability to do everything on their own at the high performance level that is needed for a big success. As a result, an average tech startup with investor funding consists of a 5-person team with about $1 million in funding.
As an individual, if you produce a good product, you can often earn some money with it. The key difference is that you're not likely to have the capability to dominate your niche. For instance, as an individual company, you might be able to make a casino app that earns $1,000/month, but it's unlikely that you'll pull off a high-end social casino platform that earns $100,000/month.
An app startup company generally needs 3 people.
As you scale the company, you might add multiple marketing or customer service representatives who work under the Chief Marketing Officer. You might add more designers or an animation/video team to work under your Chief Design Officer. And you might hire out more developers to work under the Chief Technology Officer.
All of this future hiring will be much more successful if you have a good foundational team to lead the departments that your company may someday require.
Begin building your team by looking for people with complementary strengths, who share the same level of commitment.
A close friend may make a great business partner if they are good at tasks that you aren't. But if you're both good at the same tasks, then you're likely to find your partner redundant in your business, and you're prone to fail based on your shared weaknesses.
Likewise, going into business with a friend can be a rewarding experience if you are both willing to work the same number of hours each week (or something that reflects your equity distribution in the company). But if one partner does not have time or energy to keep up, then there is a good chance that the partnership and friendship may suffer as a result.
If you don't know anyone who has complementary strengths and commitment to your business concept, don't hurry to partner. This is one decision where "moving fast and breaking things" definitely is not the best strategy. Instead, start building your company by yourself by doing market research and product development. As you work, take time to meet with mentors, go to local events and conferences in your industry, and join startup groups in your area. These will give you opportunities to meet people in person, which is the best way to develop trusting relationships.
Connect with people to talk about your projects over lunch. Try to be helpful with the projects they're working on. You can give input, recommend resources, or refer them to people in your network who might be able to help them. In return, they might also be interested in helping you with your project. (If they aren't, that's fine. No need to push it.)
Later on, if you think of some ways to work together, try them out. You might be able to work on each other's projects or collaborate on a joint venture. If these projects produce revenue, you can agree on terms for revenue-sharing. By working together incrementally, you'll learn what they're like to work with, what skills they bring to the table, and whether you can depend on them.
If you decide to partner with someone and share equity in your company, make sure to allocate equity fairly, so that they will stay engaged in the company long-term. Draft detailed contracts about your roles, responsibilities, and payment structure. Set up a mechanism for their shares to vest over time, so that you are protected in the event they are not able to stay involved in the company. Finally, make sure that you stay focused on the company, so that you can always bring 100% of your energy to work each day. Hopefully, they'll be inspired by your drive and commitment, and they'll do the same.