Don’t Compete in a Market, Create It
A lesson I have learned from the App Store is that apps in specialized markets can do very well. Specialty, or niche, apps are apps for very specific hobbies or types of people. The possibilities are endless: video games, sports, dogs, bird-watching, fishing, astronomy, and so on. Even though these hobby-targeted apps seem to appeal only to a small segment of the population, they can easily bring in six figures. Unfortunately, the success of niche apps is overshadowed by the more widely touted news of someone’s creating the next game sensation. Realistically, the odds are stacked against you in terms of creating the next viral game craze. Among the stories that generally go unpublished are those of apps in specialized categories that generate tons of long-term revenue and that have much less competition. I reached out to a fellow appreneur, Brass Monkeigh, when writing this book. His unique series of apps not only transformed the app market, but also literally created a new genre of apps. Brass Monkeigh shares his chronicle of how business acumen can be born of personal passions and interests:
The story of Brass Monkeigh Apps begins with a familiar set of circumstances: a college dorm, too much free time, and an idea. In 2009 I was a college student taking introductory programming courses. In my spare time I, like most of my roommates and peers, spent far too many hours playing video games. Having the engineering mind that I do, I always kept a calculator next to me while I played. The purpose of this was to keep track of my kill-to-death ratio , which is commonly considered the primary statistic for determining the skill of a player. After every few games played, I would bust out the calculator and figure out how many more kills I needed to add to the numerator of the equation before my ratio would tick up. Streamlining this simple math equation became the springboard on which my company was launched.
Around the same time, I purchased my first iPhone. The device’s ease of use and ability to support custom software amazed and intrigued me. I made it a personal goal to learn the necessary programming language and design a specialized calculator for the iPhone that would calculate and track my kill-to-death ratiofor me and then provide me with different statistics about it. After a month or so of saving tips from my food delivery job, I managed to scrape together $250. I then asked my parents for a loan for the remaining $200 needed to purchase a used MacBook on eBay. This first MacBook wasn’t pretty, but it did the job. With only a 13-inch screen there was barely enough room to fit the iPhone simulator, but it was enough for me to design my first app.
After I had a working model of what I called the Kill Death Ratio Improvement Tool , the question arose as to whether to publish the app in the App Store. This question did not have a straightforward answer. I had already spent $450 on this project, nearly half of which was borrowed money that I would have to pay back, and to publish my little calculator in the App Store meant signing up for the iTunes developer program, which would set me back yet another $100. “One hundred dollars buys a lot of ramen noodles” was all I could think of. According to my logic at the time, after I convinced five or six friends to download my app, I would still be out more than $90 in the long run. Thankfully, I could not have been more wrong.
January 2010 rolled around, and by that time I had repaid my parents and even had a little holiday money burning a hole in my pocket. I decided to sign up for the developer program and publish my app. By the end of the month, the Kill Death Ratio Improvement Tool by Brass Monkeigh Apps had been published in the iTunes App Store . What happened next would change my life forever. My first day I had three sales. I couldn’t believe that three totally random people had paid to download the app I made. The following day, three turned into five. Before long I was making nearly $10 a day, which meant that I would be able to recover the cost of the developer program in only a number of days, compared with the year I thought it would take.
The excitement consumed me. Literally overnight I went from a college student sleeping until noon to a motivated individual waking up at 7:00 am every morning to check my download report from iTunes. Shortly thereafter, I started receiving e-mail requests from users of my app asking me to include more features. I spent more long hours working to oblige those requests. Soon, I was devoting as many hours to programming as I was to my delivery job.
The process of listening to customer feedback and updating my app accordingly turned into a continuous cycle. The days turned into months, and before long, I had what could be considered a small business. Over the course of two years, I’ve learned a lot about the app market, and I was honored when Taylor asked me to share some of that knowledge in his new book. There are many lessons that I’ve learned, but I feel that my friend Brian, of Web Pyro, summed it up best. He told me, “Some of the complex issues that you run into when designing software are so crazy that they probably only have one-in-a-million odds of ever occurring. The problem is that there are millions of them, so statistically you’re bound to run into a few.” He could not have been more right.
Although I feel that my career as a programmer is still just beginning and that the experiences I have to draw on are limited, I have found several lessons to be near universal truths. The first of these truths is that working as an independent software developer provides you incredible freedom. You have the freedom to set your own hours and work how and when you please. Yet, although it may feel like you are your own boss, you’re not. Your customers are your boss and should always be treated that way.
The next word of advice I would pass along is that you can never expect to make everyone happy. It is an unachievable goal that you must always strive for, but no matter how vast of a resource pool you devote to your products and customer satisfaction , you will never please all your customers. Handling these seemingly illogical consumers will be what defines your company’s reputation, its character and integrity.
Finally, competition is not warfare. I carved out a niche for my business, and it has since become a crowded one. Although I strive to make the best products I can, I must acknowledge that there will always be others out there who come along and make similar (and, admittedly, sometimes better) features for their products. This is, in fact, how I met Taylor. We both designed similar products but managed to learn from one another rather than undermine each other’s efforts.
Competition, success, and failure are all part of the natural cycle of business and life. I am very thankful for the success that the App Store has given me, but it is important to know that success can depart as quickly as it arrives. For this reason, it is important to act with the understanding that nothing lasts forever and to enjoy any success you experience while it lasts, because only time will tell how enduring any given market truly is.
Brass Monkeigh makes some major points I want to emphasize. I am sure you have heard the saying “The customer is always right.” This is beyond true for users. If you fail to keep your users happy, your apps will not do well. Brass Monkeigh saw a market opportunity and was able take advantage of this knowledge. He customized his apps to meet the needs of a particular segment. He is very humble, but let me tell you, his latest line of apps is very well done and incorporates any possible feature a user could imagine. Because of Brass Monkeigh’s willingness to optimize features and content based on his customer base’s requests, his apps have consistently ranked among the top 100 in the reference category for more than two years.
Let’s apply this concept to your app. If you already have an app in the App Store, you probably woke up to download your sales, expecting to be a millionaire; odds are this didn’t happen. Maybe your lack of success is what has motivated you to read this book. If success has eluded you, it is not time to give up. Rather, it is time to analyze your app and come up with a good business model. The reason I have dedicated an entire chapter to niche and specialty apps is because of the competitiveness of the App Store today. The days of creating fart apps and fake fingerprint scanners that make millions are over. Truthfully, I am glad about this because I would get infuriated when I would see these stupid apps making tons of money. People now expect quality, complex apps that focus on special interests and hobbies. If you’re able create apps that enhance or integrate into a consumer’s hobbies, you have struck gold.
Picking the Right App to Develop
I cannot tell you how many clients come into my office each day and have this “amazing” idea for a game that is going to make billions. Usually I just shake my head. The gaming category of the App Store is beyond competitive. If you create a game, your competitors, who are not independent developers, but multimillion dollar companies, will have a significant advantage. I get this e-mail approximately once a day: “I want to create a game like Angry Birds.” Really, you want to compete against an app that is so popular and branded that it now has shirts, toys, candy, and even headphones? Yeah, that will go well. Can you sense my sarcasm here?
Most novice appreneurs do not fully fathom the complexity involved in creating popular games. To compete alongside the games of this quality will require an investment of hundreds of thousands of dollars. For this reason, I deliver the same forewarning to all clients who want to develop a game app: you will make a dollar or millions, but there isn’t much room in between. I know scores of developers and appreneurs; many have made millions on apps, but none have made millions on games. I never shoot someone’s dream down, but I try to let clients know that they are taking a huge gamble and that the odds are stacked greatly against them. So, to minimize risk, I try to convince them that their first project should be smaller—a niche app. You need experience before taking on such a major project.
Perfection without practice is an unreasonable expectation with any endeavor, and creating apps is no different. Therefore, I begin questioning my clients about hobbies and passions to help them with the app development process. Usually, by the end of this conversation they have nixed the idea of a game in favor of a niche app that will yield them more money and cost a fraction to develop. Whereas the gaming market has a small potential to be lucrative, the niche market shows promise for long-term financial gain. The simple economics of supply and demand explains this phenomenon. The games market is flooded with choices; however, the niche market has fewer offerings for the target population. Needless to say, when consumers search for apps relevant to their particular hobby, the scarcity of choices will influence them to download those apps that appeal to their interests. It is a little known fact among experienced appreneurs that the specialized market is extremely popular and powerful. I am not a fortune teller, but I could probably take your phone, look at the apps, and tell you what your hobbies are.
The Power of Niche and Specialty Apps
Advertising and marketing niche apps is not difficult. For instance, maybe you have created an app for bicyclists because you’re an avid cyclist. Initially, you want to make sure when you market the app that only cyclists are exposed to the ad. There is no point in doing broad-spectrum advertising, for example, using Facebook or Google, because not everyone cares about cycling. Free advertising is always the best, so begin accessing some forums for cyclists. Then, post about the app to let people know about it. It is likely the cycling groups will be excited to see what you have created. Next, look on YouTube for some popular cyclists. Remember, you have a new app, so don’t approach Lance Armstrong or Dave Mirra. Instead, find popular but lesser-known cyclists. Reach out to them, and see if they are willing to back and promote the app. You should expect to offer the cyclist sponsor something in return for the endorsement, either money or exposure. My experience has shown that having some popular YouTubers backing your app will be worth the aggravation; popularity sells.
After you have recruited popular cyclists to back your app, people on the forums will be talking about it. Now, it is time to approach some cycling companies for affiliate programs. Affiliate programs are set up to offer you money for selling a company’s products. Companies providing these programs are also willing to advertise your app for you; of course, while they are advertising your interests, they are simultaneously advertising the company’s products. By the completion of the affiliation process, your app is selling, and you are making steady revenue. Consequently, people are buying your affiliate’s products from the app, and you are making even more revenue. Affiliate programs are a well-kept secret in the app world that you now know about! The cycling example serves as a model for successful app marketing. Even though you may not be creating a bicycling app, changing this template to fit your app’s needs is very simple.
In the world of niche apps, customer relations is paramount. People will want to contact you about your app. This may be in the form of a bug report or just someone saying that he or she enjoys the app. Be sure to include a simple e-mail form in your app for these inquiries. Getting back to your customers in a timely fashion will benefit you significantly in the long run. You can build a great relationship with a user just by taking a few seconds to e-mail that person back. If your app is for users between the ages of 12 and 18, this is even more important. Young consumers think it is cool when the developer e-mails them back and often will look up to you. Also, if your particular app is conducive to community interaction, take advantage of this. For instance, Brass Monkeigh makes guides for popular video games; he has one of the best customer relations models of anyone I know. He personally writes responses to the majority of his users’ e-mails and interacts with his users via Facebook and Twitter. His best form of customer interaction, however, is community games. He invites his users to play the video games with him. By making a connection with his consumers, he ensures that these people will download each app he makes, and believe me, they do. People also share and retweet his apps constantly on the various social networks. So, Brass Monkeigh has created a virtual relationship with his consumers, resulting in repeat business and free advertising!
By taking the time to build a relationship with your users, you are guaranteeing they will buy your future apps. These actions will make them feel like your friend; as a friend, they will likely advertise your apps to others. Remember to respect your customers. They paid money for your app, so keep them happy, and add the features they want. The appreneurs that listen to their customers are always successful.
Now it is time to further your app education by learning about the various business models for apps. This topic is covered in Chapter 4.