How To Develop New Products | Startup Product Development https://www.thinklions.com/blog/category/product-development/ Grow Your Startup Exponentially Thu, 17 Aug 2023 07:04:46 +0000 en-US hourly 1 https://wordpress.org/?v=6.7.1 How To Launch A Tech Startup in 90 Days https://www.thinklions.com/blog/how-to-launch-a-tech-startup/ https://www.thinklions.com/blog/how-to-launch-a-tech-startup/#respond Tue, 21 Jun 2022 07:44:00 +0000 https://www.thinklions.com/blog/?p=1160 Everyone has a great idea at some point, but most don't bring it to fruition because they don't know how to launch a tech startup.

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Everyone has a startup idea at some point in their lives. But unfortunately, most people, even those with amazing ideas, fail to bring their vision to fruition. It’s not a lack of commitment or ability that hinders progress, but they have no clue how to launch a tech startup. 

Without a process, everything is complicated. If you’ve watched a toddler trying to tie their shoe for the first time, you’ll see how impossible doing anything is without the proper process. However, launching a tech startup doesn’t have to take years. Veteran founders know how to bring new ideas to the market within months. In this article, I’ll show you how to launch a startup in 90 days or less. 

The Goal of Launch

Before I show you the process, let’s ensure we’re on the same page. Until we agree on the goal, the process doesn’t matter. 

First-time tech founders believe that before launching, you must build out every feature or function. But experienced founders know that they don’t even need to write a single line of code to enter the market and start earning revenue. 

The goal of launching your product is not to build the perfect product. Instead, the goal is to learn exactly what customers want, create it, and introduce it to the market. In other words, your goal shouldn’t be to take years to develop some ultra-complex solution that you think your market wants – it should be to get something simple on the market and learn what the market wants. 

Now that you understand the destination, let’s discuss the most appropriate route to get there. Specifically, I’ll give you a proven week-by-week schedule and explain what you need to do to build your product and get it in the customers’ hands. 

Note: For more information, check out the video, “How To Launch A Startup” below.

Week 1-2: Market Research

Let’s put this in context: you’ve recognized a market problem and have an idea of how to solve it. Great. Now what? 

Most people don’t know how to launch a tech startup. The majority of those with an idea will do nothing at all. They’ll keep thinking about it for years, and then one day, they find out that another brand brought their concept to the market. While they were thinking about building it, someone else was building it. 

A handful of those with an idea will move forward, but most will take the riskiest route possible. They’ll hop in and start building out every feature they can think of, spending thousands of dollars to create a product without validating that customers want to buy it. 

In the first two weeks, the most practical action you can take towards the progress of your tech startup is researching the market. Researching doesn’t mean just hopping on Google and searching for stats about your market and customers. Instead, during these two weeks, you’ll go out in the field, engage your audience, collect data, and validate whether a challenge exists that requires your solution. This process involves the following steps: 

  1. Profile your ideal customer. 
  2. Find customers to engage. 
  3. Interview them. 
  4. Conduct a competitive analysis. 
  5. Assess the data and refine the concept. 

Profile your ideal customer

At the core of this How to Launch A Tech Startup guide are the customers. Start your research by understanding who your customers are. Ultimately, you want to build a profile of your customer – give them a name, a personality, and a face. When you create the profile, ask yourself the following questions: 

  • Who are they? Look at your customer from a demographic and psychographic perspective. You should understand their lifestyles, from what they look like and where they work to how they spend their time and what things are important to them. 
  • Where are they? Explain where your customer lives, where they spend their time, and who they spend their time with. Maybe they reside in a specific city, study at a particular university, or attend a certain nightclub every weekend. You need to know exactly where they are because that will give you valuable insight on how to reach them. 
  • What are their challenges? In other words, in your customer profile, you should show that you understand the specific issues that your customer experiences. When you know their challenges, it makes it much easier to design a solution that directly solves their particular challenges. 
  • Where do they search for information? Some customers may look in social media groups for product recommendations, while others may search on Google to find solutions to their challenges. For example, an elderly individual seeking a new medication may talk directly with their doctor, while a younger individual might turn to medical influencers. Creating a strategic marketing plan will prove impossible if you don’t know where your customers search for information.  
  • Who do they trust? Likely, your customers won’t fully trust you as a new brand. However, if you can identify influencers and brands they trust, you can determine the potential partners you need to streamline brand trust in the market. 

Take all this information and organize it into a detailed profile of your customer. Furthermore, if you serve several customer segments, you’ll find it most impactful to create a separate persona for each customer type.

Learn how to launch a tech startup the right way - the way that attracts investors.

Find customers to engage

Now, you have all the preliminary information you need to understand precisely who your customers are. The next step is to find and engage with these customers. Before you knew who your customers were, finding them was like taking a shot in the dark. However, now that you have a detailed profile of who they are, where they are, and how they search for information – locating them should be a much easier task. 

Look at your contact list and determine whether anyone meets your created profile. Most entrepreneurs start businesses in industries where they are already active. If this is the case, you likely have peers with qualities that align with your customer persona. But if not, there are many other places you may look to find qualified prospects, like forums or social media groups. You may also find them offline in relevant meetup groups or social clubs. 

You can learn a substantial amount about these individuals by observing them as they interact. By following the questions they ask, you can quickly identify the problems they experience. By determining who they listen to or talk about, you may get more clarity on who influences them or whose information they trust the most. Still, you’ll learn the most about them when you begin engaging them in conversations and immersing yourself in their experiences.  

Interview prospects 

After identifying prospects, you’ll seek to learn more about their experiences by interviewing them directly. The goal is to determine whether they have a substantial challenge that warrants a solution and whether your proposed solution adequately addresses their challenges. 

Schedule an in-person or virtual interview with a dozen or so prospects. Create open-ended questions that allow you to understand the challenges in their journey, their existing solutions, and their perceived challenges with current solutions. Take notes as you conduct these interviews. Once you’ve completed your initial discussions, assess the data and see if you can find patterns in their responses. Then determine: 

  • Is there a substantial challenge that they face? 
  • Does your proposed solution effectively solve their problem?
  • Are there features you can add to improve your solution? 

Entrepreneurs can learn two things by interviewing their prospects. First, they may discover that they have the perfect tech solution already, which will validate their initial assumptions. However, the most likely outcome is that they find weaknesses in their initial concept. Contrary to popular belief, this is a good thing. Finding flaws ahead of time allows you to fix them, severely reducing tech startup risks and improving your value proposition. 

Conduct a competitor analysis

Unfortunately, it’s not enough to just know what customers want; you also have to ensure that there aren’t other competitors in the market already solving those problems adequately. Entering a saturated market is complex, and there’s little potential for succeeding there.

For example, you might conclude that consumers want an e-commerce solution where they can find just about anything and have it shipped to their doorstep within three days. That would be a great insight for an entrepreneur. However, there’s already Amazon – and if your solution isn’t critically different or better than Amazon (which it probably isn’t), then it’s unlikely that customers will choose your solution over what’s already available to them. And even if your concept is better, what keeps Amazon from just building it themselves? 

Fortunately, you’ll find all these answers when you conduct a competitor analysis. The first step to competitor analysis is to identify all of your direct competitors. Next, you will analyze each of them and determine their positioning, strengths and weaknesses, effectiveness in solving customers’ problems, and how their solution compares to your prospective solution. Here are a few qualities you should seek to expose as you analyze each competitor: 

  • What benefits do their products provide to customers? 
  • What are customers saying about their products? 
  • Do they have a clear value proposition? 
  • What are their unfair advantages? 
  • What do customers like and dislike about their products? 
  • Which methods are they using to introduce their products to and reach customers? 
  • Is their financial position strong? 
  • Are there areas where they are weak that you can capitalize on? 

Assess the data and refine the concept

Market research aims to validate your concept and find areas where you can improve to maximize your potential. At this point in your journey, you should have significant data about your market, customers, and competitors. 

Assess this information and record any identified insights. For example, if you find that all your prospects mention a specific problem outside of your initial assumption, then maybe you should pivot your concept to address that particular challenge better. Or, if you find that competitors are doing one thing well, but failing in another area, maybe you should pivot your concept to address the areas where their weaknesses are most prevalent. 

Before you build anything, ensure that you are positioning your company correctly by conceptualizing the right products that solve a real challenge and doing it in a way that outperforms competitors. 

Week 3-4: Soft MVP Development

In only 14 days, you’ve generated valuable data and applied it to your tech startup idea. As a result, you know you’re building something that people will want. But unfortunately, that’s not enough. 

Unfortunately, need does not equate to action. For example, I need to buy a lawnmower. My lawn grows too fast, and the lawn service I hired rarely shows up when they are supposed to. However, I’m too lazy to mow my lawn every week. So would I actually buy a mower even though I need it? Probably not. Even if I was willing to purchase a lawnmower, there are 50 different brands out there, and with so much competition, it’s not a given that I will buy your lawnmower. 

Validating Assumptions

When learning how to launch a tech startup, you must also learn how to validate assumptions. Assuming that people will buy your product is risky. You won’t know if your market will buy your product until you give them the option to buy your product. 

We’re two weeks in, and we haven’t built anything yet. So how can we offer something for sale that we haven’t created yet? New and veteran entrepreneurs often differ in their market approach. New entrepreneurs build products, then sell them. On the contrary, experienced entrepreneurs sell products, then build them. 

In weeks 3 and 4, you should focus on building your soft minimum viable product. At this point, you aren’t developing the product yet. Instead, you’re offering the idea of the product as an experiment to test whether customers would purchase the product – if it existed. 

For startups launching a tech startup, there are two primary ways of testing customers’ purchase intent: crowdfunding platforms and landing pages. 

Soft MVP: Crowdfunding Campaign

Crowdfunding has become a trendy method of funding new product development. In 2021, the global crowdfunding market size was more than $114 billion. 

By definition, crowdfunding is the practice of funding a venture by raising capital from many people – generally, individuals seeking to pre-purchase the product. Numerous crowdfunding platforms exist, but Kickstarter and Indiegogo are the most popular ones today. 

Using Kickstarter to launch a tech startup

In terms of building a soft MVP, crowdfunding platforms enable startups to produce designs or mockups of their products, describe details of the benefits, deliver visuals of the product, and allow people to pre-order their products before they physically exist. 

Pros and Cons of Crowdfunding

Launching a crowdfunding campaign can catapult your market introduction. However, this approach has both advantages and disadvantages. The benefits of crowdfunding include: 

  • Millions of customers frequent the platforms, giving founders a broad audience of prospects. 
  • Users are aware and excited about the fact that they are first adopters. 
  • Enables founders to market and sell pre-developed products. 

However, there are also several disadvantages to launching your product using crowdfunding platforms. These disadvantages include: 

  • Crowdfunding is geared towards a particular type of product – software rarely gains traction. 
  • A successful campaign requires significant preparation and promotion to gain momentum and stand out against hundreds of other innovative products on the site. 
  • Crowdfunding puts time pressure on the business. Customers expect companies to deliver products on the day they promised in the campaign. 

Crowdfunding serves as a minimum viable product because it enables you to experiment with the idea of your solution in the real market. If the campaign fails to generate traction, it is probably a strong indicator that your concept doesn’t resonate with the market.

However, if you succeed in meeting your fundraising goals, it can have a massive impact on your business. This benefit comes from accessing capital without giving away equity and receiving immediate brand awareness. Once customers receive the product, crowdfunding also provides social proof to make the product more attractive to other prospective buyers. 

Soft MVP: Landing Pages

For concepts that don’t fit the standard mold for crowdfunding, a more practical approach to launching a soft MVP is utilizing landing pages. Through this method, you will still create designs or models of your product, and you’ll still write up content explaining the solution’s benefits. However, you will promote your product independently using a landing page. Crowdfunding and landing pages share the same goal – generating brand awareness and validating interest in your product. However, you will do it without the motivated traffic that crowdfunding campaigns provide. 

How To Build a Landing Page MVP

Building a landing page today is much easier than it was in the past. There are numerous landing page builders like Unbounce and Leadpages, which also make it easy to monitor analytics related to your page. You can also buy landing page templates from sites like ThemeForest, which are customizable through basic HTML or WordPress. 

On the landing page, you’ll pitch why customers should buy your product. Then, provide them with an offer to pre-purchase it. However, some entrepreneurs choose not to offer a pre-purchase option but use a shadow button. A shadow button gives the impression that a user can purchase the product, but when they click the “Buy Now” or “Checkout” button, it sends them to a “Product Unavailable” or “Coming Soon” page. While this won’t generate revenue, you can monitor how many people clicked the button and know that those people intended to buy the product – if it existed. 

Week 5-6: Soft MVP Launch

Congratulations, you’ve built your first minimum viable product! But unfortunately, developing it and doing nothing else won’t get you anywhere. In the next two weeks, you’ll launch your soft MVP, market it to your target audience, and begin collecting data to validate that customers will actually purchase your product. 

How to Market a Low-Fidelity MVP

There are over one billion websites on today’s internet. Considering this vast number, you won’t get a single click if you don’t have a strategy for promoting your landing page to your audience. Hundreds of millions of businesses, organizations, and individuals actively promote their websites and landing pages, and everyone is fighting for visibility. 

Generally, there are two ways to promote your landing page. There is the organic (free) way, which is less effective, and the paid way, which is most effective. Likely, your strategy will incorporate both approaches. 

Organic Marketing Methods

On the organic end, there are a few activities you might want to consider. Posting a link to your social media profiles may get you a few clicks, but it won’t drive significant traffic. However, you can use several other social media methods, such as joining related Facebook and LinkedIn groups and participating in relevant subreddits (Reddit). After you’ve engaged organically within these groups and provided value to the other members, you can post your landing page to introduce it to the community. The benefit of these groups is that you can surround yourself with people who directly fit your customer persona, engage deeply with them, and create brand awareness among the group. 

Influencer marketing can also be impactful in driving traffic to your page. A micro-influencer is an online personality with 10,000 to 50,000 followers in a specific niche. By partnering with and hiring them to mention your business or product, you can immediately promote your page to thousands of people with the recommendation of someone they trust. This method isn’t necessarily free; likely, they will expect something in return. However, if your product is something truly innovative and impressive, you may be able to offer them future access to your problem in return for their promotion. 

Paid Marketing Methods

Paid strategies will give you the most and the quickest traffic. For example, running a Google Ads campaign with a large enough budget can drive hundreds or thousands of targeted individuals to the landing page within a few days. That is, as long as you focus on the keywords and phrases your customers are actively searching. When they type in those terms, you want your page to show up, allowing them to click the link and view your offering. Since this is a paid strategy, it’ll cost you every time someone clicks on your link. The industry you’re targeting and the keywords you select will determine how little or how much you’ll spend on each click. 

In addition to driving traffic to your low-fidelity MVP, this method will also show you what marketing tactics work. Then, once you launch your official product, you’ll know the most impactful strategies, and you can scale those activities to drive attention to your products. 

Monitoring Data for your Low-Fidelity MVP

With a strategic marketing plan, you’ll have people coming to your page consistently. But keep in mind that the point of launching this low-fidelity MVP isn’t to just generate traffic but mainly to figure out if people would buy your product. To validate your product’s potential to attract customers and drive sales, you’ll need to pay attention to the data. A few essential metrics you should monitor and assess include (but are not limited to): 

  • Click-Thru Rate (CTR): The number of people that see your offer and click through to the landing page. 
  • Time Per Session: The length of time people spend on your page in a single session – allowing you to determine whether they read through the page or immediately leave before learning more. 
  • Conversion Rate: The percentage of page viewers who take action, such as downloading a lead magnet or pre-purchasing your product. 

Week 7-8: High-Fidelity MVP Development

By the sixth week, you will have already learned what customers want, conceptualized a solution, and validated that customers are willing to buy it. During weeks seven and eight, focus on developing your initial high-fidelity minimum viable product. In other words, you will build your product but with the minimum amount of features necessary to provide value to early adopters. 

Example: Airbnb’s MVP

Airbnb followed a similar strategy, launching with a minimum viable product. Realizing that a design conference was coming to San Francisco, the founders created a simple landing page, giving attendees a chance to rent a bed in their apartment. The price was much lower than other accommodations (like hotels) and gave a much different experience. So instead of launching a complete solution and struggling to find properties to fill the marketplace, Airbnb’s founders started with what they had – a landing page and their apartment. 

Launch a tech startup - Airbnb's initial minimum viable product

Airbnb’s platform would probably cost millions of dollars to build today, but their initial MVP cost almost nothing. Through the MVP, they validated the demand and potential of their concept and even earned their first revenue. 

During weeks seven and eight, you’ll take the same steps – build the simplest form of your solution that provides value to customers. Then, choose a limited market that you can promote to. Again, the goal is to get to market quickly, validate your product idea, and get the product into users’ hands. Once you collect data from those users, you can create valuable insights regarding your market, customer, and product. 

Week 9-10: MVP Launch

You will launch your high-fidelity MVP in the market during weeks nine and ten. Once you introduce the product, you’ll follow the same steps you did for your soft MVP. These steps include scaling up your marketing plan, getting people to your sales page, and convincing customers to buy your product. The good news is that you should know what conversion rate to expect since you tested for conversions and collected the data during your low-fidelity MVP launch. 

Week 11-12+: Build-Measure-Learn

Now, your product is on the market, and you’re making sales. But your job is just beginning. In weeks 11, 12, and beyond, you’ll continue generating customer data and insights, developing the product, and ensuring the optimal product-market fit. To accomplish this, you will implement a build-measure-learn feedback loop. During this process, you will build and launch a new feature (build), collect data and feedback (measure), and use that data to make insights on whether you have created the right thing (learn). 

Some of today’s fastest-growing startups utilize the build-measure-learn feedback loop. For instance, Facebook started with straightforward profiles and targeted a single market – students at Harvard. After validating their initial idea, they added new features like the news feed and messenger, tested them, and decided whether to keep them or pivot.

Some features, like virtual gifts, didn’t last. Facebook launched them, tested them, and learned that customers weren’t fond of those features, so they ditched them. Likewise, you might ditch some ideas as you build up your product. Some you’ll keep – but only after validating that customers actually want them. 

How To Launch A Tech Startup: Key Takeaway

You’re only 90 days from launching your startup, but you have to start small and build your way up using data from genuine customers. At this point, you have a product on the market, you’re generating traction, and you’ve validated demand for your product. You know how to launch a tech startup, and you’ve proven it through your actions. Now, you can start seeking investment to scale your product and business. For this, you’ll need a fantastic pitch deck and business plan – and we can help! Contact us today and learn how we’ve helped hundreds of startups grow their businesses and achieve their fundraising goals.

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How To Improve Business With Pirate Metrics (AARRR) https://www.thinklions.com/blog/pirate-metrics/ https://www.thinklions.com/blog/pirate-metrics/#respond Tue, 16 Nov 2021 08:23:33 +0000 https://www.thinklions.com/blog/?p=1129 Pirate metrics (AARRR) is a framework that enables you to monitor customer behavior, reach your objectives, and grow your startup.

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Pirate metrics are useful for tracking the behavior of users from the time they learn about your business until they become valuable, long-term, and loyal customers – with consideration to every step across the customer journey. Teams who can monitor, assess, and optimize each metric are more likely to successfully create synergy between marketing, sales, and customer support efforts, building a machine that brings customers in, creates widespread satisfaction, and maximizes revenue. 

Startups use these metrics to understand where they stand in every stage, including acquisition, activation, retention, referral, and revenue. Unfortunately, teams that fail to monitor metrics, or those that monitor the wrong metrics, usually do not know whether they are succeeding or failing. And if they do know which path they are on, they don’t understand why they are on that path. This article will explain the exact pirate metrics you should be using to collect the data you need to grow, scale, and reach success with your startup. 

What Are Pirate Metrics? 

Yes, the name sounds childish, but there’s a reason why “pirate metrics” is the perfect name for this group of data points. If you’ve ever heard a pirate say, “AARRR MATEY!” then you already have a grasp of what these metric categories are. In the case of real pirates, they use the phrase to showcase happiness, joy, or glee. And in business, if you use them right, it will give you the same joyous feelings! 

AARRR is an acronym that stands for: 

  • (A) Acquisition: Acquisition refers to how users find your business, what channels they use to find you, and how you introduce your products or services to them. 
  • (A) Activation: Activation metrics track how users engage with your brand and how they perceive your brand during their first experience. 
  • (R) Retention: Retention tracks how often customers come back to visit your site, repurchase products, or how many times they engage with your brand. 
  • (R) Referral: Referral refers to how many people tell others about your brand, product, or service – creating new clients through their networks. 
  • (R) Revenue: Revenue metrics track users who make a purchase or participate in some type of monetization event. 

Here’s a quick disclaimer. Some sources will define pirate metrics as AAARRR, including an “awareness” stage. Others will put revenue before referral. However, the original introduction of pirate metrics from Dave McClure of 500 Startups defined the acronym excluding awareness, and it positions revenue as the last category. And for that reason, so will we. 

pirate metrics - customer acquisition and awareness

Monitoring Acquisition Metrics

Before you can bring on a new customer or initiate a sale, you must first make them aware that you exist. Many channels are available that you can leverage to market your product and get in front of potential users or customers. Channels can include social media, blogs, Google Ads, YouTube, or even more traditional marketing techniques like television commercials and billboard advertising. 

Why Track Acquisition? 

Marketing is expensive, and low click-thru rates, high acquisition costs, and lower-than-average conversions can cause you to run through your advertising budget quickly, yielding few results. By tracking acquisition channels and performance, your team can better understand which channels work best and which don’t work at all. In addition, these metrics can help you identify ways to improve the techniques that are performing well, leading to more views, more leads, and more conversions. 

Which Acquisition Metrics Should I Track? 

As you bring in potential customers to the top of the funnel, you can track several metrics to help you adjust and improve your acquisition strategies. While there are many metrics you could monitor, some of the most popular and helpful acquisition metrics include: 

  • Impressions: You can’t always access impressions directly – but when you can track them, you should. Impressions showcase how many people viewed one of your ads, whether on Google, Facebook, Twitter, or another platform. By tracking this metric, you can ensure that your ads are optimized and that you are covering the right keywords or audiences to maximize views. 
  • Number of Clicks: It’s essential to know how many clicks you are receiving from your campaigns. If you notice that only a few clicks are coming in, you can dial in the cause, which can be numerous things, including your ad description, your selected keywords, and more. 
  • Click-Thru Rate: CTR describes the percentage of impressions that turn into clicks. On most platforms, you pay for clicks, not impressions. For that reason, monitoring impressions is not enough. Unfortunately, monitoring clicks alone doesn’t give you the complete picture either – at least, not on its own. Click-Thru Rate tells you how many users view your ad and then click over to your site. Research the average CTR for your industry, and if you fall behind the average, you can make the tweaks necessary to improve the metric and your ad performance. 
  • Cost Per Click: It’s satisfying watching traffic come to your site from your ad campaign, but not if your spending on the click costs more than potential revenue from a sale. Some industries are just naturally more competitive and clicks cost more for these sectors. But other times, high costs per click could come from low-quality scores on your ads or because of an unoptimized campaign. 

Utilizing Activation Metrics

The second category in pirate metrics is activation. First impressions are everything, and customers will make immediate judgments about your entire business based upon their first experience. Activating a customer means getting them to reach the “ah-ha moment.” 

The “ah-ha” moment is defined as the moment of sudden realization, inspiration, insight, recognition, or comprehension. In terms of business, it’s the point where the customer realizes that your product or service is what they need to solve the specific problem they are experiencing. 

Why Track Activation Metrics? 

Acquiring visitors is a significant accomplishment, but it’s a waste if their first experience with your product is negative – or if they are unimpressed with your brand when they happen upon your website. By tracking activation metrics, you can ensure that visitors realize the value of your offering. 

Depending on your business, you can activate a client with several different techniques. For example, a SaaS company might activate a customer by offering a free trial – allowing them to get a hands-on experience with the product. A car dealership activates a customer by getting them behind the wheel; some offer a test drive, and some allow the customer to take the car home for a week. 

The activation stage prepares the customer for purchase. If you aren’t achieving the ideal targets here, you might get users to your site, but they will all click away without even considering a purchase. Inevitably, your overall conversions and sales will grow as you collect metrics and optimize your activation efforts based on the data.

Which Activation Metrics Should I Track? 

Activating customers gets them one step closer to purchase. Activation metrics will allow you to ensure that each visitor has a successful first experience as they engage and interact with your brand. Some of the essential activation metrics to track include: 

  • Number of Free Trial Downloads: Some businesses, like SaaS startups, use free trials to activate new users. These companies will track the percentage of visitors that download or request a free trial. Furthermore, this metric could also represent the number of visitors that schedule a consultation or request a demo.
  • Number of First Events: Activation could also be a “first event.” For example, the first event for a social media site may be setting up a profile or posting the first status. For a business like Dropbox, activation could be the number of visitors that upload their first file – as they know that once someone uploads one file, it is much more likely that they will continue uploading more. 

Understanding Retention Metrics

According to studies, it can cost five times as much to acquire a new customer when compared to retaining an existing customer. Retention metrics allow you to understand how many customers stick around and why others churn. The goal is to make sure that every user becomes sticky – meaning that they come back to your product frequently or use it consistently. 

Why Retention Metrics? 

Customer retention is a sign of satisfaction. Dissatisfied users will churn quickly, but they can also cause harm by leaving negative feedback and reviews. On the other hand, if you can retain customers for the long term, you will ensure that you are solving their specific problems. These users often become a business’s most loyal brand ambassadors. 

If you don’t understand what causes customers to retain or churn, you can’t make the necessary adjustments to maximize user satisfaction. As you collect and assess these metrics, you will gain insight into what users really want – and once you deliver it, your retention rate will expand drastically. 

Which Retention Metrics Should I Track? 

Retention can differ based on your particular business type. For example, for a SaaS business, retention could be the number of re-subscribers each month. On the other hand, retention may be defined as the rate of return purchases for a product retailer. Here are a few examples of retention metrics: 

  • Retention and Churn Rate: Retention and churn are opposites. The term “retention” refers to a measure of the number of customers a company retains over a given period. Churn refers to the rate at which customers end their engagement with a business over a given time. 
  • Repeat Purchase Ratio: This metric measures the percentage of customers or users who return in the future for another purchase. The higher the percentage, the more revenue your business will generate. 
  • Net Promoter Score: NPS rates the likelihood of a customer recommending a company, product, or service to one of their peers. The rating is given on a 0 to 10 scale, with 0-6 being detractors, 7 and 8 being passives, and 9 and 10 being promoters

Measuring Referral Metrics

Referral metrics help you answer the question, “How likely is it that an existing customer will refer someone else to your business?

Referrals are critical to a company since they can help enhance visibility and reduce acquisition costs. As we mentioned, acquiring a new customer through traditional marketing channels is expensive. An acquisition could cost hundreds or thousands of dollars in some industries, like finance or business services. In contrast, it costs the business nothing to bring on a prospect referred by another customer. 

Why Referral Metrics? 

The more referrals you can inspire, the more revenue you will generate. Furthermore, referrals are also a great way to assess customer satisfaction. There is no marketing channel as effective in persuading customers to purchase as a recommendation from their peers.

It is essential to know how many people refer your products to their networks and which channels they use. Understanding why they share, when they share, and who they share with can inspire new efforts for incentivizing brand ambassadorship and increasing your referral potential. 

What Referral Metrics Should I Track? 

To get the most data, you want to track metrics across all the channels where customers review and refer products to their peers – social media, review sites, and more. Some of the essential referral metrics you should track include: 

  • Social Shares: Social media is a powerful tool for introducing products to new customers – especially when those products are shared by their closest friends. By encouraging and incentivizing social shares, businesses can increase their visibility with the backing and recommendation of individuals that prospects trust most – peers. 
  • Ratings & Reviews: Positive ratings and reviews are another form of referral. Customers can refer products to prospects they don’t know by leaving public ratings on platforms like Google, Facebook, TrustPilot, BBB, etc. The higher your ratings are, the more confident prospects will be that your product will solve their problems sufficiently and successfully. 
  • Customer Satisfaction: Only satisfied customers make referrals, and by tracking how satisfied your customers are, you can also predict the likelihood that they will share your product online, tell a friend, or leave a favorable review. 

The Most Important Metrics – Revenue

Revenue is arguably the most critical metric category. Ultimately, none of the other metrics matter much if it doesn’t eventually earn revenue. What’s the point of referrals if they don’t bring more income into the business? 

By knowing how your business earns revenue and understanding its drivers, you can position the startup to focus on its strengths and consistently grow its monthly income. 

Why Revenue Metrics? 

Revenue metrics allow you to assess how much revenue your business generates and how it generates that revenue. Entrepreneurs often see the money coming in and just assume that things are in great shape. And when an unexpected expense comes up, or sales take a shift, these entrepreneurs freeze like a deer in the headlights. When you are fully aware of your revenue metrics each month, you’ll notice if things take a turn for the worse and can address any issues as they arise. 

What Revenue Metrics Should I Track?

To get a big picture idea of revenue, you can track every dollar that comes in – keeping a close eye on monthly recurring (MRR) and annual recurring revenue (ARR). However, there are several other metrics you can track to better understand your business’s revenue position. These metrics include: 

  • Average Transaction Revenue: Businesses find it much easier to predict future revenue when they know the average transaction revenue. Furthermore, awareness of this data enables you to ensure that each transaction is profitable and that your customer acquisition rates are low enough to earn positive profit each time a customer makes a purchase. 
  • Customer Lifetime Value: We’ve already mentioned how necessary retention is; the longer you keep a customer around, the more revenue you will generate from that customer over time. The duration of that time is the customer lifetime. If you understand the actual value of each customer, you can better gauge how the acquisition of each customer will impact your business’s bottom line – both presently and in the future. 
  • Conversion Rates: Another vital factor for revenue is conversion rate. Revenue is directly related to how many customers you can convert. Therefore, you should always track your conversion rates and seek to improve them over time. 

How To Apply Pirate Metrics

The whole goal of pirate metrics is to develop a funnel that helps you understand your customer and business on a granular scale. Collect metrics intentionally – know what information you want to collect, and then decide which metrics are most important to track to give you the essential details about your business. Pirate metrics are crucial to developing a lean startup since you can use them to adapt and further develop your product. They also give you the supporting data that you need to prove your business case in your pitch deck or business plan. 

As always, if you need help writing your business plan, creating your pitch deck, or developing your app – we’d love to hear from you. Contact us today to discuss your startup with one of our expert consultants.

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How To Create A Low-Fidelity Prototype Like An App Expert https://www.thinklions.com/blog/low-fidelity-prototype/ https://www.thinklions.com/blog/low-fidelity-prototype/#respond Thu, 02 Sep 2021 06:15:00 +0000 https://www.thinklions.com/blog/?p=928 App development is expensive. Before you build, it's best to build a prototype to ensure the proper functionality.

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App development is expensive, and entrepreneurs assume a huge risk when seeking to launch a new app. New software can cost tens of thousands of dollars to develop, with ongoing maintenance costs that grow as the software expands. Yet, out of 10,000 new consumer apps, only one will become a financial success. 

If you’re an app creator, the odds for success are unfortunately stacked against you. However, your potential for success can be much greater if you follow the right steps – like creating an effective low-fidelity prototype to generate early feedback and ensure that you are on the right track. 

Somewhere around 2009, the startup world was introduced to the concept of the lean startup. In his book The Lean Startup, Eric Ries describes a new methodology to develop businesses. This methodology seeks to shorten product development cycles and prove the viability of business models by launching experiments through iterative product releases. One of these experimental methods is prototyping, and especially, building and testing low-fidelity prototypes. 

Low-Fidelity prototypes are great tools to get funded. Learn how to build an app startup that attracts investors.

In the following post, we will look into how prototyping can help you as you build your app and explain exactly how to build your first low-fidelity prototype.

What is Prototyping? 

Building an app is challenging. There are many variables involved between the time an idea is conceptualized and the point that it is successfully launched to market. The closer a project is to being finished, the more expensive it becomes to make changes and implement feedback. A prototype is an early product sample that allows entrepreneurs to effectively test their concepts.

When building an app, prototyping is often used while designing the user experience (UX) and user interface (UI). The prototyping process allows designers to experience the application as a user, before even going into the actual design stage. 

App designers use prototypes in the same way that writers use an outline. Writers use headings in their outline to map out the flow of their piece, while app designers use pages to map out the flow of their software. 

Prototype Categories

While there are many types of prototypes, they can generally be summed up in one of two categories – low-fidelity and high-fidelity prototypes. 

  • Low-fidelity prototypes are simple and extremely low-tech. In some cases, they involve nothing more than just a pen and pencil, or a slideshow program like PowerPoint. 
  • High-fidelity prototypes are functional, interactive, and may even involve some coding. Typically, these include things like clickable wireframes or even low-function MVPs. 

Some people include a third category – medium-fidelity prototypes. These models are digitized and may have some clickable/interactive areas. They include virtual elements but do not take as much effort to build as common high-fidelity prototypes. In many cases though, these prototypes still fall into a high-fidelity category. 

Why Create a Low-Fidelity Prototype? 

Three reasons to create an app prototype

Low-fidelity prototypes provide many great benefits to entrepreneurs, designers, and developers of new app solutions. There are five major reasons that you should add low-fidelity prototyping into your app development process. 

Team Collaboration

In most cases, designing is not a one-person activity. For an app startup, the app design process may include several managers, marketers, designers, developers, and beyond. 

Low-fidelity prototypes provide a non-intense opportunity for teams to map out their app concepts and make changes with the least amount of risk. Paper prototypes, for example, can be constructed at little to no cost. Members of the team can provide their feedback and the ideas can be implemented immediately – with no risk aside from losing a few hours of time. 

During this stage, inefficiencies in user experience and screen flow can be ironed out, while the general layout of the application can be perfected. 

First Visualizations

Although you will likely wireframe your idea first, a low-fidelity prototype gives you the first visualization of what the app will actually look like in motion. 

Trying to explain a complex vision that you see in your head isn’t always easy, but with a low-fidelity prototype, team members and consumers are able to easily see what your concept is and how it will perform once it is built. 

The tangible visualization of a project is important. When an idea is in your head, it’s difficult to notice inefficiencies or weaknesses. By skipping the prototyping stage, inevitably, these weaknesses will make their way into your software. Realizing these weaknesses after development can cost several thousands of dollars. These same changes, if made in the low-fidelity prototyping stage, probably wouldn’t have cost anything to change. 

Testing & Validation

Prototypes provide the lowest-risk method for testing an idea and generating real user feedback. In the early stages of app design and development, user feedback is important. As you test your concept more and more with real users, you learn more about what those users need, how they behave, and what they expect from your solution. 

Wireframes, while usually understood by the management and design team, usually progressed enough for users to comprehend. Prototypes, on the other hand, give something real for users to touch, use, or at least, see in action. 

Prototypes can be used in focus groups, sent to beta users, or even used as a customer demo. They can be used in a variety of ways to generate feedback, gather data, generate insights, and validate your customer assumptions. 

Types of Low-Fidelity Prototypes

Low-fidelity prototypes can take on many forms from simple pen/paper sketch prototypes to concept demos. Some of the most common low-fidelity prototypes are described below. 

Storyboards 

Storyboards go one step beyond a simple app wireframe. Each screen in the storyboard can be hand-drawn using UI stencils or even constructed of different on-screen elements from wireframe kits or cards

Types of low-fidelity prototype, storyboards

Once the elements of each screen have been laid out, they can be positioned into a storyboard that details the purpose of each page and the response of each element. A flow for each button, icon or link can be defined using arrows that point to other screens and display what happens when a specific element is clicked. 

Paper Prototypes 

Storyboards are great for connecting the dots, but they aren’t very interactive. Paper prototypes, on the other hand, are the first and most basic types of prototypes that users can actually engage with. These models are basic and are a far cry from a real application, but they are flexible enough to mimic real functionality. 

Paper prototypes don’t have to be extensive. Screens can be placed next to each other. A cardboard phone mockup can be placed over the paper to better envision what the application would look like and how it would function if it were developed and digitized. 

The following video shows an awesome low-fidelity prototype example. This example displays exactly how a simple paper & pen model can represent real app functionality. 

Clickable Presentations

A clickable presentation carries all of the same benefits as a paper prototype, but it uses presentation software to automate the flow of pages. Each slide in this presentation incorporates a single design or wireframe screen. As the slideshow progresses, the audience is able to better understand how each screen ties together. 

Clickable presentations can also be used in a focus group setting, presented to large groups, or sent out to beta users for feedback. 

How To Create A Low-Fidelity Prototype

Four steps to creating an app prototype - define objectives, choose a model, build the prototype, test and evaluate

Low-fidelity prototypes are simple to construct and can provide a significant level of insight to improve your concept. Although the process is simple, there are still several considerations you want to keep in mind as you give your idea it’s first visual life. Here are five steps you should follow when creating a prototype. 

1) Define Objectives & Goals

Before putting together a low-fidelity prototype, decide exactly the reason you’re building one in the first place. Not all prototypes serve the same purpose. Some prototypes are meant to generate feedback from an internal team while others are developed for user feedback. One entrepreneur may be building a prototype to check for total page flow, while another may be only testing the flow of a single feature. 

Define what you want to achieve by creating a prototype. Before you can decide what type of test to put in place, you must know what assumption it is that you are trying to validate. 

2) Type of Prototype 

The type of prototype you build will depend upon the assumptions you seek to validate. You may decide you need a paper prototype or a clickable presentation, or you may find that a low-fidelity prototype doesn’t suit your needs at all. If you find that your assumptions can only be validated with something more substantial, a medium or high-fidelity prototype may be necessary. 

Medium-fidelity prototypes have limited functionality but often have clickable areas that allow users to engage. A low-fidelity prototype may be used to validate screen flow or placement of elements, while medium-fidelity prototypes can be used to better understand how users interact with different elements. 

High-fidelity prototypes are computer-based representations of the product. In comparison to the other models, these prototypes offer the closest representation of the product without being actually developed. These models may be built up in a program like InvisionApp to offer maximum engagement. Ideally, these prototypes will include every necessary screen and allow users to click or swipe between the screens. While a HFP may include some front-end coding, it does not include any back-end functionality – functionality is mimicked instead of actually being coded.

Low-fidelity prototypes allow you to better test the user interface (UI) while high-fidelity prototypes allow you to also test for user experience (UX). In most cases, it is best to test multiple prototypes, beginning with the most minimal low-fidelity model and building your way up. 

3) Build It

Finally, it’s time to build your prototype. Make sure you have all the tools that you need. For a paper prototype, all you will need is paper and a pen. If you’re building a clickable presentation, you’ll need Powerpoint or another presentation software. 

First, figure out what pages you need. Then, go through each page and detail what purpose each page needs to serve. Write up major headings on each page and begin drawing in the elements. 

Here’s the important step. Examine each screen that you have sketched out, and decide what elements are not needed. Any elements that could be left out without affecting the functionality of the application, should be removed for smoother performance. 

Now decide how each screen will flow with one another. Layout the screens next to each other or in a storyboard with arrows to show how they flow. 

You’ve created your first low-fidelity prototype. Yes, it’s that simple! 

4) Test 

The whole point of building a prototype in the first place is to test for usability and generate necessary feedback to improve the concept. Depending on your specific situation, you may decide to test your prototype with your team only or extend your testing to include real customers. 

Set up the test environment. Make sure that your prototype is built to a level that users can engage with it on their own without needing your help or explanation. Once they have used it, ask the right questions to gather sufficient feedback and to validate your specific assumptions. 

5) Repeat 

Your job isn’t done after making a single prototype. A prototype is a valuable tool that can help you as you further develop your application and as you introduce new features.

After collecting responses from your team and from users, evaluate the responses. Did the data validate the assumptions you made? If so, great – move on to the next test and validate your next assumption. If not, make the necessary changes and test it again. Even after your app has been developed and launched, prototypes can be used to test changes or validate new ideas before coding them. 

Your Prototype Was Successful, Now What? 

Congrats! You’ve finally launched your prototype. What does success look like? A successful prototype is any prototype that allowed you to learn more about your user. Whether your assumptions were validated or proven false, both of these situations are considered a success since it provides you with the insights you need to take your concept to the next level. 

Use those insights to build your next prototype, or if you’re ready, to go ahead and build your first minimal viable product. As you continue to test, you can use the metrics you’ve generated to prove your concept and even to raise investor funds for further development. 

Ready to build your minimal viable product? We’d love to help. Our team of app developers knows exactly how to bring an app idea to life. 

Did you build an awesome low-fidelity prototype for your app? Tell us about it in the comments below! 

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How To Start A Tech Company Using Lean Startup https://www.thinklions.com/blog/how-to-start-a-tech-company/ https://www.thinklions.com/blog/how-to-start-a-tech-company/#respond Thu, 12 Aug 2021 19:11:00 +0000 https://www.thinklions.com/blog/?p=1022 New entrepreneurs struggle to bring new technology to life. Find out how to start a tech company using lean startup principles and methods.

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Launching a tech company of any type is an intimidating process. First-time entrepreneurs often have no idea how to start a tech company, they just have a great idea and a desire to win. Unfortunately, a great idea isn’t enough. There are many steps between the idea stage and the rapid expansion stage; and if you aren’t clear on what those steps are, you can quickly become overwhelmed with the process and give up.

While not making it to launch sounds like the worst thing that can happen when developing your startup, there’s actually something worse that can happen. You can spend tens of thousands (or more) on app development, only to launch your tech and find out that nobody wants it. A tech startup can be a major success, but if launched without covering the right bases, it can also be a major waste of time, money and effort.

Fortunately, there is a process for building a great tech company, and it follows the principles of Lean Startup. Ready to launch your software business? Here’s what you need to know about how to create a tech company using lean startup.

What Is Lean Startup?

Lean startup allows a tech company to constantly advance the development of their software, while rapidly learning more and more about their customers, their challenges and their desires.

If you thought the only steps to creating a successful software solution was to build it and launch it, your strategy is hugely flawed. There are many really cool and interesting apps in every app store that no one ever downloads and no one ever uses. Those who know how to start a tech company know that a company isn’t successful because they have a cool product; they are successful because they have the right product for the right audience, and are backed by the right people.

When you launch a full-scale software solution, you inherently make several assumptions. Even with secondary industry and customer research, you are still only making an educated guess as to:

  • Who your consumers really are.
  • What problems your consumers are actually facing.
  • What type of solution your consumers are searching for.
  • How much your consumer is willing to pay to solve their problem.
  • Whether enough people experience the problem to make a successful business.

The true intentions of a startup is to answer these questions using real consumer data, and to validate each and every assumption as you build your product. Instead of figuring out that you built the wrong thing after you built it, the right strategy will help you identify weaknesses and errors in your startup plan before making serious investments into the wrong areas.

Lean startup logo for launching new tech

This is the value of adopting a lean startup process, and why those who know how to start a tech company often adopt this strategy. Lean startup incorporates a build-measure-learn feedback loop – launching software in small iterations, testing it with real consumers, analyzing the data and proving the concept at every turn. What’s the major advantage? If at some point during the measuring process you learn that consumers aren’t responding as you assumed they would – you can pivot immediately instead of continuing to develop something that they don’t want.

As much as we’d like to think that our idea is the perfect idea, this is often not the case. Facebook in 2018 is incredibly different than it was in 2006. If they built the perfect product, why would they continue to change; adding new features, changing features, and deleting others? Because people change, the market changes, the competition changes, needs change – and when they do, your startup better change with it if you plan to stay in business. When you know how to start a tech company using lean startup, you can adapt and remain flexible with the market – using data to lead you. Lean startup allows a tech company to constantly advance the development of their software, while rapidly learning more and more about their customers, their challenges and their desires. As you learn exactly what your customers want, you can more accurately serve them and always ensure that you are delivering the software product that they are most likely to adopt.

How To Start A Tech Company In 6 Steps

Launching your first-version software doesn’t have to be a long and difficult process. Sure, developing technology can be challenging and there are many variables; but with an agile development and lean startup process, you can minimize the time and risk associated with launching a startup. Here are six steps to launching your tech company the right way.

1. Minimize It To The Core Features

Rome wasn’t built in a day, and the whole city didn’t have to be built for a few families to make it their home. Likewise, your software doesn’t have to include every feature under the sun before you launch it. In fact, launching a feature-filled software solution is the most risky approach to software development. Instead, minimize your concept to just one or two core features – the features that you believe will help users solve their specific problem most effectively. Typically, users aren’t going to adopt every feature a software offers – the ones that they don’t use will ultimately become a waste of the effort it took to build it. The better approach is to test the market with only a few features, prove the concept, and then build the next set of features after validating exactly what the market is demanding.

However, when you have your mind set on what you want your software to look like, it can be challenging to decide which features are actually “core”, and which ones are additional frills that aren’t necessarily critical to the functionality of the software. Follow these three steps when seeking to minimize your technology to its core features:

  1. Define your target market: Your technology might serve multiple customer types, but initially, it’s best to focus on just a single target market. Selecting a narrow audience will allow you to intensify your focus on a specific consumer sector and penetrate that particular niche – instead of going head on against more established solutions. Draw out your ideal user – How old are they? What do they do for a living? What do they read and watch on television? Where do they live? What is their income? Most importantly, what problem are they facing?
  2. Create a storyboard: Plot out how individuals will use your technology; each step that they will take as they journey through your solution. Think of how they will use each feature, and how each feature will help them solve their problem. Consider the primary goal of your technology, then write out the user flow – this will help you determine all the features of your tech concept. Prioritize these features – which are truly necessary to meet the primary goal and which could be eliminated without really affecting the user’s end goal?
  3. Remove non core features: Once you’ve determined which features are low priority, remove them. Your solution should now only include a few features that make up the entire user flow; but if it still has too many, create a new storyboard and prioritize again to see if there are additional steps that can be eliminated to create a true minimal and viable product.

2. Get To Market With An MVP

Developing a minimal viable product for your tech startup

Now that you have a first-version software concept that is minimized to only it’s core features, it’s time to prove your concept. Getting to market quickly is key, and it’s not always necessary to even build the technology fully before launching it. There are several different types of Minimal Viable Products that you can consider, but the one you choose should be based upon the goal of your test. Here are the most popular minimal viable product types:  

  • Smoke Test: Build a landing page, send traffic via ads, and measure how many people sign up.
    • Goal: To test user interest.
  • Pre-sell: Launch a crowdfunding campaign and measure how many people donate.
    • Goal: To gauge user interest and raise funds.
  • Concierge: Perform services manually; giving clients a hands on service before automating it with technology.
    • Goal: To create new ideas, generate feedback and collect data about consumers.
  • Wizard of Oz MVP: Make it look as if the features are automated, when really they are manually performed behind the scenes.
    • Goal: To test assumptions about product and customer behavior.
  • Piecemeal MVP: Take a pre-built technology and customize it to perform the necessary functions.
    • Goal: Prove concept before making a larger investment into product development.
  • Single-Feature MVP: Develop solution with one or a few core features and launch it to the market.
    • Goal: Gain traction and validate feature assumptions

3. Attract Early Adopters

how to start a tech company - generating users

Once your minimal viable product has been launched, it’s time to start attracting users. You don’t have to go all out and spend tens of thousands of dollars on advertising your app – but instead, send a limited number of users to the application in testable numbers. A couple hundred users can give you incredible insight into whether you are on the right path, or whether you are building something that the market doesn’t want. Even a small amount of users can give you humongous amounts of information. There is no point in sending tens of thousands of people to your solution if you haven’t even proven that you have built the solution that they want.

  • Self Promotion: You’d be surprised how many startups gained the first handful of users because the founder simply just put in the necessary hands-on work to acquire them. Tinder’s founders for example, posted flyers around campuses and told people about the app at local campus bars. If you can identify individuals that would benefit from your technology, contact them – tell them about your solution and explain to them how your solution would solve their specific problems. One hundred handshakes could be the first domino in locking in your first one thousand, one hundred thousand or even one million users.
  • Communities: Becoming active within online communities can provide great access to early adopters and industry influencers. Platforms like Reddit offer categorized sub-channels where you can communicate with other individuals that are interested in a specific subject. The key to succeeding in any online community or forum is to not go in with an attitude of selling something. Instead, be helpful and showcase your expertise about the subject to assist others with their questions. Become an active part of the community. That way, when you do post about your software, people will know who you are and you won’t seem like a greedy self-serving startup that is spamming the network.
  • Influencers: You don’t always have to convince a million people to try your software. Sometimes, you can convince one person who has a large audience, and let them do the persuading for you. Part of knowing who your consumers are is knowing who they follow – authors, blog writers, YouTubers, industry experts and etc. Try to build relationships with these individuals. Allow them to test your software for free, and ask them to review it. Keep in mind however, your competitors are probably also contacting them asking them for the same thing. Just like when dealing with communities, figure out how you can offer something that benefits the influencer – before asking them to do something that solely benefits you.

4. Evaluate Data

Tech company launch - testing and evaluation

There is nothing that will tell more about your solution, strategy and user than cold hard data. Everyone pays attention to the number of downloads and the amount of revenue the software is generating, but these aren’t the only app metrics that matter. There are many other metrics that should be analyzed frequently, including but not limited to:

  • Active Users: It doesn’t really matter if you have 1,000 users if zero are actively using it. Both Daily Active Users (DAU) and Monthly Active Users (MAU) are important to analyze. DAU tracks how many users actually open up and use the software in a single day while MAU tracks how many use the software over the period of a month. Unlike total sessions, each user is only considered a single time, as opposed to counting the same users over and over if they sign in multiple times throughout the day or month.
  • Average Visit & User Behavior: These metrics allow you to analyze how long users are staying on your software and what they are doing while they are there. Average Visit gives an average of how long a user session lasts, while user behavior tracks what pages they visit and how long they stay on each of those pages. To learn more about user behavior, it is a great idea to use heatmaps and screen recordings. These tools allow you to see exactly what users are looking at, focusing on and clicking on while using your software.
  • Retention Rate: Just because you’re able to get people to your app, doesn’t mean that they’ll continue to use it. Retention rate lets you know how many users you’re able to retain over a set period of time and how many you lose or ‘churn’. Retention rate helps you identify the relationship between your marketing initiatives (how well you are attracting people to your software) and your engagement strategy (how effectively you are getting people to engage with your software).
  • Ratings & Reviews: Solutions that are able to sustain over the long-term are those can maintain great ratings and reviews. Software and app solutions operate in a very competitive space, and no matter what great things a company says about their products; it will never have the same effect as what other users say about it. Ratings and reviews are subjective metrics that can have a major influence on how successful a software solution becomes. You may be getting a great deal of traction today, but if you aren’t receiving a bad rating average – you may find it extremely difficult to get even a single new user in the future.
  • Cost Per Acquisition: Attracting customers to your app may not be worth it if it’s costs an insane amount to acquire them. If your per customer acquisition cost is more than your customer spend; you’ll operate at a loss and may find it extremely difficult to continue to sustain your business.

The numbers tell the true story of your business. If you don’t know the statistics, then you definitely don’t know how your business is actually performing. One could assume that they are on track because they see new downloads coming in each day, but they may miss other numbers that tell the real story – like a high customer acquisition cost or an extremely low retention rate. Most of all, the numbers behind your business tell you whether you’re on the right path, or whether you’ve made a mistake in your assessment.

5. Pivot Or Persevere 

Start a tech company - pivot or persevere

In the optimal and ideal situation, you will look at the data and everything will be going as expected – acquisition costs will be low, everybody that downloads the app will use it for months and months, you’ll get fantastic reviews, and your tech startup will become the best solution in your industry within a month’s time.

Does this sound too good to be true? It is.

What will most likely happen is that some of your assumptions will be validated by the data, and it will be proven that some of your assumptions are flawed. Discovering that some of your initial assumptions are incorrect is to be expected, and it’s not a bad thing. Each time you are unable to validate your assumption, you are given an opportunity to make a shift and find exactly what your consumers are looking for. Each time you prove or disprove an assumption, you have the opportunity to do one of two things – pivot or persevere.

When the data shows that your assumption was correct, the only move that makes sense is to persevere or stay on course with what you are doing. To know whether your data proves your assumption, you should have goals set in place – what conversion rate you expect your marketing campaigns to convert at, which features you believe users will use the most, how long you believe users will use your app during each session, how many weeks or months you believe they will continue to use your software before they churn, and etc.

On the other hand, when the data shows that users aren’t responding to your software the way you assumed they would, a pivot is likely in order. A pivot simply means to adjust to a new path, and hopefully, a more successful path. Let’s say for example, you find that you many users download or trial your software, but that they only stay on the software for a minute or two before exiting. In a case like this, there is likely a reason for this behavior. Some possible causes of this could include:

  • Users were interested in the marketing message, but the solution did not meet their expectations.
    • What can you do to fix it? Change the marketing message to better reflect the actual solution, or change the solution to match the marketing message (which may reflect what users really want).
  • Users found it too difficult to use or navigate the software and left in frustration.
    • What can you do to fix it? Work on a better user experience or provide better education on how to use your software.
  • Users ran into a bug and weren’t able to perform the intended actions.
    • What can you do to fix it? Identify the bug and fix it.

The whole idea of a startup is to find out what solution your consumer is really looking for. By running tests and choosing to pivot or persevere based on real data – you can ensure that you are building software that really has the potential to succeed.

6. Scale Everything

After testing and testing, using data to make the right pivot/persevere decisions, and building a solution that is a hit among early adopters; it’s now time to scale it to the masses. Since your marketing plan has already been tested and validated, you should be able to amp up your campaign and draw in more and more users.

In many cases, it’s at this stage where startups will begin seeking initial seed funding. With user data in hand, startups with a validated solution have a much stronger investing position than startups that are only coming to the table with ‘cool tech’. These startups not only prove that they know how to create innovative technology, but also that they know how to start a tech company with a strategic and well-planned approach.

The Most Important Step in Launching Your Startup

In essence, these six steps will help you build the perfect product with an agile and lean approach. Putting them all in action however, can be much more difficult in practice. Actually, building a lean tech startup is much tougher than simply just writing a list of features and having a developer build out. Launching a lean tech startup means slowing down the development process, releasing in small iterations, testing each iteration along the way, and bringing on customers in small increments. The upside is, at each iteration, you strengthen the potential for success of your concept and decrease the risk of failure.

Launching a tech or software startup

The most important step – is taking a step. You can research how to start a tech company, and come up with an awesome software concept; but if you never commit yourself to taking the first step, you’ll never see it through to fruition.

We’d love to help you bring your tech company to life. Our startup consultants have worked with hundreds of app startups around the world. Ready to take the first step in bringing your app idea to life? Contact us today to schedule a consultation with one of our tech startup experts!

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How To Design An App That Stands Out https://www.thinklions.com/blog/how-to-design-an-app/ https://www.thinklions.com/blog/how-to-design-an-app/#respond Sat, 10 Apr 2021 19:13:00 +0000 https://www.thinklions.com/blog/?p=973 If your design doesn't stand out, users will abandon your app instantly. Learn how to design an app that stands out from the competition.

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Chances are, when you encounter a well-designed app, you can’t put your finger on exactly why it’s great. Great apps simply just feel good. And with so many apps on the market, if you’re going to compete, your users need more than smart color palettes and fancy gradients – users need to feel that your app has the “it” factor. If you’re going to win, you need to know how to design an app that captivates.

Unsurprisingly, most app entrepreneurs know what they want the app to do (heck, most of the time they’ve already named the app) but they have no idea how to actually design an app. And while we don’t expect that entrepreneurs should know how to single-handedly build a business model and develop the app, we do expect that most designers should know how.

But here’s what most people don’t realize: not all designers know how to build an app because building an app that stands out is hard. Sure, they may focus on selecting the right color tones and making sure that all the required elements are added (which is important!), but they may not be focused on how a user will feel the first time they use the app; problem solving isn’t their primary concern.

So, is it possible to deliver on the promise of a functional, user-friendly app that has a captivating aesthetic?

In our ultimate guide to building a mobile app, we’ll teach you exactly how to design an app that is cutting-edge but familiar; beautiful but easy to adopt; and ultimately, one that stands out amongst the hundreds of thousands of apps in the app store.

Getting Started

1.  Understand the Problem You’re Solving

Sure, a well-designed app looks good but aesthetic is not the only marker of a great app. In fact, most users believe that as long as the design allows them to accomplish their mission in some way then it must be a good design, right? Well, not exactly. To adopt an app into their daily lives, users are going to need a clear path, functional code, and design that engages. The whole enchilada.

And that begins with not only understanding the problem you’re solving but partnering with the right team to translate how your solution clearly solves that problem.

2. Create a Wireframe For Your App

A wireframe is the blueprint for your design; or rather, a draft of your app’s visual architecture. It’s meant to serve as a functional sketch so don’t worry about including color palettes, logos, or interactive design at this stage in the game. Getting your workflows on paper will help your idea come to life, as well as help bridge any technical language gap between you and the developer or agency you hire. How many times have you tried to explain your vision only to have it come out all wrong? A wireframe helps translate your idea when words seem to fail you.

And because building a mobile app is different than building a mobile-first website, creating a wireframe will help you communicate your app’s value proposition.

Wireframes can be sketched with pencil and paper or, for a more finished look that you can share digitally, here are some of our favorite free and paid resources for wireframing:

Designing and Developing Your App

how to design an app - stack of books

3. Find a Savvy Designer

Remember those smart color palettes and beautiful interfaces we talked about? Now it’s time to think about the design of your app and hire a designer to bring those elements to life.

This is an important step because, much like the functionality of the app, a great design will leave a lasting impression on your users. We strongly recommend hiring a designer because, even if you’re a gifted designer yourself, bringing an experienced designer on board to translate your wireframes into beautiful mockups frees up your energy for successfully launching and monetizing your app. Build a stronger app by hiring for your weaknesses.

Here, we’ll break down your options for hiring a designer as well as app design tips to keep in mind as your app comes to life.

Working directly with a designer

Pros: If you have a clear vision of how you want your app to look, working 1-1 with a designer can be a great option.

Cons: You’ll have to do the legwork to find a designer with mobile app design experience, as well as independently source a developer who can translate that design into functional code.   

Using an app builder

Pros: This option is best suited for those with low budgets and very basic expectations.

Cons: Much like a website builder, you can build a basic app with this option but if you have any complex ideas or are scrapped for time, this isn’t the option for you.

Hiring an agency

Pros: Hiring an agency the complete package: you can lean back and let a qualified team build your app from the ground up. You’ll have a team of experts managing the design and development of your mobile app which leaves you to focus on other critical launch projects like marketing and monetization. And, you can still contribute input on design elements and the final product.

Cons: This will be the most expensive option but if you want it done right the first time and without having to micromanage or sacrifice your own time, it’s a tough option to beat.

App Design Tips  

4. Pick Colors and Fonts That Serve A Purpose

Colors not only brighten the world around us, they’re also a powerful communication tool that can evoke emotions, thoughts, and behaviors. Use the effects of color psychology to your advantage and select hues that evoke strong (positive) responses.

Similarly, the fonts you choose will influence the look and feel of your mobile app. Sans serif fonts (type faces without little feet) offer a more contemporary, modern look while serif fonts (fonts who have feet) bring a more traditional or professional look to your design.

Make sure to consider the hidden meanings these design elements communicate and choose them mindfully.  

5. Put the User’s Needs First

For your app to be a smash hit, you need users to understand its purpose, have an easy time navigating through it, and make it something they will adopt into their daily lives. And then, of course, you need people to tell their friends about your app.

So, where do you start? Here, we share the three most influential characteristics of a great mobile app:

  • Easy navigation;
  • Clean, simple design;
  • Beautiful interfaces

6. Simplicity is Key (Especially On a Small Screen)

A clean, simple design helps make the user experience as enjoyable and easy as possible.

Designing for simplicity means generous use of white space and using familiar symbols and phrases.

By using white space, the unmarked area around design elements, to bring balance to your design, you give the user a chance to process what they’re seeing without feeling overstimulated. Too much information presented on screen and your user is likely to become overwhelmed and abandon the app.

And by keeping symbols and language familiar, the user feels like they know their way around; they’ve been here before.

7. Offer Easy Navigation and Familiar Layout

Provide users with a layout and symbols that are familiar to them, so they’ll know intuitively how to navigate through your app.

It’s no secret that humans need direction. People are more likely to stick with it when they have clear guidance on where they’re supposed go next. But a user can’t navigate the app if the nav bar and options are hidden, so ensure the user always knows where to go.

How do you make that happen? Give the user a smooth navigation and buttons and links that are finger-friendly (we’re not designing apps for PalmPilots here, people).

Inversely, there’s nothing worse than taking an action and the action resulting in… nothing. nada. zilch. Never leave your user wondering what went wrong or what to do next. Be sure to include clear feedback when a user “takes a wrong turn” or enters invalid information.

Remember, you’re designing a mobile app, not a mobile site so respect the user’s journey through your app with these tips:  

  • Avoid mandatory sign in
  • Avoid asking permissions too early on
  • Allow them to try the app before requiring that they sign in
  • Make it easy for the user to register or sign-in by offering social media login capability to save time and cut down on the number of passwords they have to remember
  • Create forms that allow simple data input
  • Make information bite-sized and easy to process
  • Minimize the scrolling required for main screens (the only exception to this rule is for lists).

8. Find the Right Developer to Build Your App

You’ve got an idea for an app but you have no idea how to build it. And let’s be frank: finding a great developer to bring your app idea to life can be a real challenge. In most cases, but not always, there’s a correlation between the quality of the developer available to you and the size of your budget. If you can afford the best developers, you can hire the best developers.

how to design an app - choosing a developer

But what if you don’t have deep pockets like Duck McScrooge? Not to worry, you can still find the right developer for your project. Here, we outline what to consider when finding a developer, regardless of budget:

  • Ask for a comprehensive portfolio of apps they’ve built in the past.
  • What’s their experience in designing apps for both iPhone and Android?
    • Download those apps and test them on your own. Are they easy to use? Does the code function properly? Is this an app you would integrate into your daily life?
  • Check their references
    • Ask the developer’s past clients about how well they communicated, how committed the developer was to the project, and how smooth the development process was. Check the developer’s reviews on sites like BBB and Clutch.co for additional feedback.
  • How much does it cost to design an app?
    • This is a big one. Iconic brands can, and do, spend millions of dollars developing their mobile apps, so if you expect to compete with these apps with a $2,500 budget, think again. High-quality, low-cost app development does not exist. If a developer is promising you the moon and the stars for pennies on the dollar, that developer has either never built an app before or won’t finish the project (and just may ride off into the sunset with your deposit).
    • To give you a baseline, quality app development agencies often charge anywhere from $45 to $100+ per hour. In many cases, a full-scale mobile application will easily cost over $50,000 to develop all of the features and functions.
    • Discuss development fees up front to get a realistic idea of what it will cost to bring your idea to life.
  • What are their policies and procedures?
    • As with any partnership, communicating expectations and understanding each other’s policies and boundaries is vital for a healthy, working relationship. In other words, if you don’t even enjoy dating the person, don’t marry them.

Testing Your App

Congratulations! Now that your developer has translated your vision into functional code, you now have a minimum viable product; enough features to satisfy your early users to test the app for feedback and ongoing development. Every feature and function should operate properly so you can gather user feedback before the app launches. When it comes to mobile apps, your MVP will be a real application, but only includes core features. This phase allows you and your developers to launch your app quicker (and with a smaller budget), while attracting early adopters in order to generate insights and feedback. Instead of spending thousands of dollars to build a full-featured app that may or may not succeed in the market, testing your MVP only is a great way to gauge interest and usage behavior before developing further features.

Launching Your App

Launching your mobile app begins months before your app goes live in the app store. And because a successful launch is just as critical as the functionality of the app itself, we’ve created a separate guide for how to ensure a successful app launch.

Post Launch

Design practices change often, so even after your app is launched, continue to test usability and research updates that will make your app more efficient and user-friendly while avoiding fluffy trends.

With the average person spending approximately four hours a day on their phones, and more than 180 billion mobile app downloads per year, there’s plenty of opportunity to capture the attention of an engaged market. But the competition is stout, so if you’re going to create an app, follow the guide we’ve outlined for you, translate user insights into improvements, and begin mapping your launch strategy well in advance.

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How Hard Is It To Build A Successful App Startup? https://www.thinklions.com/blog/how-hard-is-it-to-build-an-app/ https://www.thinklions.com/blog/how-hard-is-it-to-build-an-app/#respond Wed, 17 Mar 2021 19:31:00 +0000 https://www.thinklions.com/blog/?p=979 Launching software sounds difficult, but how hard is it to build an app really? Our experts tell you everything you need to know.

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We have all been guilty of letting the media fool us. Over the last decade, the blogs have mentioned hundreds of app startups that have seemingly popped up from nowhere and sold for billions a month later. After reading about so many app acquisitions, building a successful app startup almost seems… well, easy. Since the media doesn’t always mention how many obstacles these entrepreneurs and app developers have faced, we are given a false perception of what it takes to build a quality mobile app and create a profitable business around it.

How hard is it to make an app? There are multiple levels to this answer. On one hand, it’s not hard at all – a variety of software will allow you to launch an app in a matter of minutes if you are building an app solely for the sake of having an app.

Now, if the question is, how hard is it for an app entrepreneur to have an app built; well, that takes on a different meaning. Difficulty depends on many factors, including budget, experience, and the competency of their developers. The level of difficulty can range from relatively easy to extremely difficult.

These are still very different questions than – how hard is it to build a successful app startup (like Uber or Instagram)? In this case, it’s about as difficult as finding a steaming hot cup of coffee in Antarctica. Fortunately, if you know what you’re doing, you can substantially improve the odds. In this post, we’ll give you the cold hard scoop on what it takes to build a real app startup and finally answer the question – how hard is it to make an app?

Building an App vs an App Startup

Building an app vs building an app startup

By definition, building an app isn’t the same thing as building an app startup. Just because you build a great app, does not mean that it will be successful – it doesn’t even mean that a single user will ever use it. Just for clarification:

  • Building an app refers to the technical side of creating an app. It involves processes such as wireframing, app design, and programming. A ‘great app’ refers to a software product that is technically sound and functions with little to no error.
  • Building an app startup refers to the business side of bringing an app idea to life. If an app refers to the product, the app startup is the entity that brings that product to the consumer and monetizes it. Building an app startup involves planning and implementing effective launch strategies, marketing strategies, pricing strategies, and more. A ‘great app startup’ refers to a business that is able to successfully introduce the application to the audience, persuade them to download the application, and convert them into long-term users.

Anyone building an app startup will build an app, but not everyone building an app is building an app startup. For instance, a storage facility chain may build an app to better manage its units, but they aren’t looking to build an app startup. However, an app startup introducing a mobile auction platform will need to build the software in order to have a product to promote.

For an entrepreneur with no development experience, building a first-version mobile app can be quite difficult. However, building the app itself is only the tip of the iceberg of what it takes to build a successful app startup.

How Hard Is It To Make An App?

To answer this question, you first have to define what you consider as an “app”. Most apps are crap, and it’s relatively easy to build another average app with standard outdated features and lackluster functionality. However, when most people are thinking about the app they want to build – they probably aren’t thinking about some mediocre app that looks like it was born in 2009; they are thinking of the cream of the crop apps that get downloaded by millions and become top featured selections in the App Store. How hard is it to make an app that can compete with the world’s top apps? It’s extremely challenging, and very few have the ability to pull it off.

There is no shortage of app ideas – everyone seems to have one, but only a brave few will ever move forward with developing it. Of those few, only a handful will ever launch their app into the App Store; and of the ones that do, only a small fraction will ever attract even 100 users.

For an entrepreneur with no coding abilities, there are three main factors that contribute to the difficulty in building a competitive mobile app in today’s market: the cost of development, lack of experience, and the inability to secure the right development team.

The Cost of Building An App

Companies like Facebook and Uber spend tens of millions of dollars each year developing and maintaining their software. If you expect to compete with these apps with a $2,500 budget, you’re living in a dream world. There is no such thing as high-quality low-cost app development. Big dreams take big budgets. Unfortunately, when pursuing app development, first-time entrepreneurs often underestimate the costs associated with building the features that they have conceptualized. A full-scale mobile application will easily cost over $50,000 in most cases to develop all of the features and functions. If you’ve adopted a lean startup strategy, a minimum viable product will likely cost $15,000 or more and will require additional capital for subsequent rounds of development.

Quality app development agencies will often charge anywhere from $45 to 100+ per hour. Entrepreneurs will also have to fund the hosting and maintenance of their application. Unfortunately, to build a high-quality app, you’ll need a significant development budget. Lack of budget is the factor that weeds out the majority of would-be app entrepreneurs.

Luckily, there are many ways that you can raise money to build your first version application; but, it won’t be easy. If you believe in your app idea and in yourself as an entrepreneur, here are a few ways that you can raise the money needed to build your minimal viable product.

4 ways to fund a startup
  • Savings: Many entrepreneurs will tap into their savings or into their nest egg to fund the initial steps of their app journey. This may include using funds from previously established savings accounts, borrowing from 401ks, or liquidating other investments.
  • Loans: App entrepreneurs often rely on outside loans to access the finances needed to push their ideas forward. Home equity loans, personal loans, and even credit cards are popular methods of financing for many app entrepreneurs in the beginning stages.
  • Crowdfunding: Innovative and fresh ideas often do well with crowdfunding. Thousands of entrepreneurs have raised the funds needed to launch their application by pre-selling the idea to their audience or raising donations before actually building it.
  • Be Creative: Entrepreneurs are meant to solve problems, and sometimes when funding is the challenge, they will need to be creative and figure it out. Take Airbnb for instance, instead of going for a traditional loan, the founders created 500 boxes of cereal labeled Obama O’s and Captain McCains and sold them for $40 per box during the presidential campaign. By being creative, they were able to generate over $30,000; giving them the boost necessary to get their software to the next level.

Want to learn more about raising app funding to build your app idea? Check out our article, How to Find App Funding for Your Awesome App Idea

Building An App With A Lack of Experience

how hard is it to build an app? - lack of experience

Developing a high-quality app requires organizing many different moving pieces – and this can be a problem for first-time mobile app entrepreneurs. Just because someone uses apps or has an idea for one does not mean that they know what is necessary to build it. When entrepreneurs act as the project manager with no previous experience, it often leads to massive delays, inefficiencies, and additional costs.

Project managers are responsible for putting all the players in motion, directing the show, and overseeing the development of the project from beginning to end. Entrepreneurs who are working with freelancers or in-house teams will often have to manage the projects themselves. Effective project managers fully understand what is being built, can strategize the best steps to build it, and can use the most up-to-date practices to complete it.

App development practices change often. One day, everyone is using double clicks; another day, swiping is the new thing. One month, 3D technology is trending, and the next, it’s all about augmented reality. Managing an app development project means you need to be a step ahead of the market and be able to direct a team to deliver a product that will exceed the high expectations of users.

So, how hard is it to make an app? Well, if it’s your first time managing a development project, it will probably be more challenging than you expected. There’s nothing that can prepare you more than getting your feet wet, but here are a few things you can do to make yourself more comfortable with managing the development of an app project:

  • Learn the Art of Wireframing: Words have a funny way of getting misinterpreted and miscommunicated when it comes to app development. You may envision the app clearly in your head, but you may not be able to explain it in a way that a designer or developer can recreate. With limited experience, you may even lack some of the jargon needed to explain your ideas properly. Fortunately, wireframes allow you to visually express exactly how you want the app to be organized. It helps you outline what pages it needs to include, how each element should be laid out across each page, and how each page interacts with the next. Wireframes allow project managers to immediately convey their vision to developers in an easily understood manner. Furthermore, creating a wireframe is pretty easy – even a simple wireframe drawn in pencil is usually enough to convey the message.
  • Join Coder Communities: Anyone managing the development of a mobile app needs to stay abreast of how mobile and development practices are changing. A few good ways to stay on top of things include joining developer communities on LinkedIn and Facebook; engaging in developer forums; and subscribing to leading programming blogs. Always keep track of what types of functions and features are trending and which ones are no longer considered vital to the customer experience. The more you know, the better you will be able to direct a team to build a modern application that exceeds user standards.
  • Check the Competition: Before you start thinking about how your app should look or function, download your competitor’s apps. Identify which parts of their app stand out and which parts could be improved. Knowing what the competition is offering will give you a baseline for the level of quality a user will expect. If you want to be a better project manager, knowing how a great app should look and function is key.

The alternative to managing a project in this way is to work with a reliable development company that goes above and beyond to understand your application and your vision. A strong development company will have experienced project managers that can translate your vision into an effective plan to be carried out by a development team.

Finding A Developer to Build Your App

There are millions of developers out there, but finding a great developer is a challenge. In most cases (but not all) the quality of the developer available to you will be related to the size of your budget. If you can afford the best developers, you can hire the best developers.

Many entrepreneurs figure that as long as they bring a great app idea to the table, they’ll be able to easily partner with a developer to build their software. Unfortunately, quality developers often will not invest their full-time efforts into building an unproven concept without a salary. While you may persuade one to take a lower salary in exchange for equity, it’s unlikely that they will strike an equity-only deal; and if they do, the likelihood that they will stick around long enough to finish it is minimal.

Hiring a freelancer may seem like a low-cost option, but sometimes, it can cost more than going to an agency. A freelancer may have a lower hourly wage, but they can come with their challenges. When compared to an agency, freelancers are often extremely limited. An agency, which may have dozens of developers, has a collaborative knowledge that is exponentially greater than that of a single freelancer. Additionally, agencies have more capacity – freelance developers are known for abandoning projects when a better offer comes around; which can put entrepreneurs in a losing situation.

building an app - finding a developer

How hard is it to make an app? Well, it’s MUCH easier when you have the right development partners on your side. Here are three tips for hiring the right developers:

  • Check For References: A developer can tell you just about anything regarding a past project or client, but if you really want to know how the project went – ask the client. It’s great to view the cool apps in their portfolio. However, just seeing an app doesn’t tell the story of what it took to get there. A great app may have taken double as long to build as projected, may have cost double as much, or may have changed hands between several agencies before it was completed. Talk to past customers and ask them about the details. Ask about how well the developer communicated, how committed they were to the project, and how smooth the process was. Check their reviews on sites like BBB and Clutch.co. The better you are able to vet each candidate, the more accurate you will be in choosing the right development partner for your project.
  • Check For ‘Cultural’ Fit: Whatever developer you choose, you will likely be working with them quite closely during and after the development of your application. Find someone that you work well with; someone who has the professional qualities that you consider important; and someone that you can stand to deal with for a long period of time. The relationship between an app entrepreneur and a developer is like a marriage. Make sure to find a spouse that keeps your interest!
  • Understand Their Policies: A valuable developer isn’t just someone who codes well – it’s someone who communicates well, is attentive to the project, won’t abandon ship right in the middle of development, and aligns with your expectations. Ask candidates about their communication policies, how delays are handled, etc. It’s the fine detail that can make or break a project!

The Real Challenge for App Entrepreneurs

Build a successful app - 3 steps

Is it hard to make an app? Yes, but in the grand scheme of things, that’s not the hard part. The most challenging part of building an app is knowing what to do with it after it is built. How do you get users to it? Can you make money off of it? How do you keep users on it once they are there? These are the types of questions that must be answered to become a successful app startup.

You’ve built a great shovel, awesome. You’ll need it. The hole you need to dig to find success is about the size of the Grand Canyon. There are three major hurdles that entrepreneurs will need to overcome when attempting to build a successful app startup: finding the right market, attracting users, and monetizing the app.

Finding the Right Product-Market Fit

When you launch an app, you’re not only competing against other apps that are in the same space as yours – you are really competing with the millions of apps in the App Store. Every app is fighting to be featured. Every app startup wants its app to be the king of its category.

However, no app serves everybody. The clearer you are about what market would benefit most from your particular app, the better you will be at getting it in front of them and persuading them to download it.

Choose one market to begin. Even if your solution has the potential to serve several markets, your marketing budget will likely be limited; so it’s much better to focus your initial efforts on the market where you can be most effective. Learn everything you can about the consumers in this market. Join the groups that they engage with, go to the places they frequent, and read the magazines they read. Speak to consumers as much as you can, and gather their feedback whenever possible. Identify their challenges, their pain points, and the qualities that they don’t like about competitor solutions. Know thy customer – because the better you know them, the better you can serve them; and the better you serve them, the more effectively you will be able to monetize them.

Getting Users To Your App

Is it hard to create an app - man on phone

It really doesn’t matter if you’ve developed the perfect solution to someone’s problem if that person is never aware that the solution exists. “Build it, and they will come” is not a phrase that is applicable to app startups. Build it and do nothing else, and no one will come. Not even a single user. It can be a lonely world in App Startup Land.

App marketing is a very strategic process. Once you know who your market is and where they spend their time, then you can start identifying the best marketing techniques to reach them. Some of the most common and successful marketing techniques that you may want to consider include:

  • Influencer Marketing: Word of mouth has always been one of the most effective methods of advertising a product, and today, influencers are the mouths of the social media world. Applications that are able to align themselves with the right influencers can be quickly exposed to large audiences. With the right influencer promotion, these apps can spread like wildfire. Not every influencer is a celebrity. In fact, not every influencer is even extremely popular. Some influencers have small audiences but have a strong influence over these niche audiences. If they say they like a product, people tune in. If they ask people to share it, their followers click “share”. Find your audience – then align with the people that influence them.
  • App Store Optimization: The majority of app downloads come as a result of people searching the App Store. App Store Optimization (or ASO) is a process for making your app more visible within the app store. Through this process, apps hope to rank closer to the top for specific keywords and search phrases.
  • Press & Media: The press plays a major role in the success of popular app startups. When the press begins mentioning your app, people take notice; because if the media is talking about you, you must be newsworthy, right? Building the right media relationships is critical for an app entrepreneur. Being mentioned by the right source can give you immediate credibility and expose your application to thousands of potential users.

Want to learn more about marketing an app? Check out our article, How to Advertise an App for Maximum Exposure

Generating Revenue (App Monetization)

How to monetize an app

Finally, a successful app startup needs to be able to generate revenue. Focusing only on advertising is not a sustainable way of earning income for most mobile app startups. Most applications are not receiving millions of views per day. For those that are, many do not make enough revenue from ads alone to support the growth of the business. Finding the right monetization model will likely take quite a bit of testing. Some consumer groups are more apt to subscriptions than others; while some types of apps are more suited toward in-app purchases than others. Here are a few popular methods for monetizing a mobile application:

  • Freemium: A freemium app mixes a “free” app and a “premium” app. Basically, users are offered a free version of the application. This free version is stripped down but offers enough features to realize some of the benefits of the software. A “premium” version is offered for either a one-time or recurring monthly fee.  With this version, the user can access additional features and further improve their experience.
  • In-App Purchases: This method allows users to purchase credits or virtual items through the application during usage. The “in-app purchase” model is extremely popular with mobile games. With games, users may have the opportunity to pay for additional lives, coins, or game items.
  • Paid Apps: For some applications, users are willing to pay upfront just to download the application. App startups with higher brand awareness may be able to attract paid users, but most users won’t spend without a trial. Some app entrepreneurs offer a free version of their app that displays ads (which can become extremely annoying), but also offer an ad-free version in the form of a paid app.

Want to learn more about monetizing your mobile app? Check out our article, How To Identify The Most Profitable App Business Model

So… Just How Hard Is It To Make An App?

A final note here. Launching a successful app is highly difficult, and it certainly isn’t for the easily shaken. Although many app ideas will fail on their journey to success, a few will survive. Yes, you can be a part of that few. The key is to know what it takes to build an app startup and prepare yourself for the journey. You wouldn’t take a trip around the world without planning your travels first, would you? Don’t start your app without a well-thought plan in place.

Are you ready to bring your app idea to life? We’d love to help you. Our project managers and app developers know exactly what it takes to build cutting-edge technology and position it for success. Contact us today, and let’s discuss your idea!

The post How Hard Is It To Build A Successful App Startup? appeared first on Startup Squared.

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