How to make a successful indie app when your odds are better in Vegas
By Abhinav Agrawal
If you’re an indie app developer, you know that Apple’s App Store and the Google Play Store are difficult places to succeed. It can feel like a game of chance where the odds of driving enough downloads and revenue to support a small app business–let alone recoup app development costs–are stacked against you.
In this post, we’ll look at data from SurveyMonkey Intelligence to see just how difficult it is to drive big app download and revenue numbers for all but the very top apps in the iOS and Google Play stores.
So, how do you make a successful app in this challenging environment? We’ll review some specific things independent app developers can do to improve their odds. Plus, we’ll discuss what the app stores could do to improve these conditions for indie developers.
The top apps get hundreds of thousands of downloads
Good luck getting to the top of the charts where organic downloads take off!
While the top ranked apps generate several hundred thousand downloads a day, this drops off steeply for lower-ranked apps. The relationship between rank and download value is a power curve with the rank #1 app getting ~24 times as many downloads as rank #100! This difference has also been growing over time, especially with marketing and acquisition costs increasing significantly.
To enjoy much of an organic growth benefit, you want people to find you near the top of those download charts. When you appear lower, you’re less likely to be found. Sadly, paying (or other means) to acquire a burst of hundreds of thousands of users to reach the top levels of the app charts is way out of reach for most independent app developers.
The top of the app revenue charts is even more out of reach
Revenue varies even more dramatically by rank. The #1 rank top grossing app makes more than 62 times the #100 rank app, on average.
Note that this analysis doesn’t capture revenue from outside the store, which includes advertising and off-store revenue. However these revenues disproportionately reward large apps, and only increase the gap between top apps and all the rest.
So if you were hoping that your app might get discovered on the revenue charts, you’ve got an even steeper climb there than on the download charts.
How to make a successful app in spite of these odds
In the short run, developing apps will remain a tough business, but here are some tips for app development teams to improve their chances of success in creating a top indie app:
- Enable referrals: Given the high costs of user acquisition through paid channels, app developers should make it easy to refer their friends–and, if possible, even incentivize them–through social channels (Facebook, Twitter) including messaging. (A great example is Down to Lunch’s use of SMS.) Referrals give your users a reason to invite their friends.
- Focus on engagement and retention: Rather than trying to grow the total audience, developers should focus on achieving product market fit by finding a loyal audience and iterating the product until they retain these users and increase their engagement. Once you achieve those metrics, you can focus on user base growth.
- Understand the demographics and needs of your user base: Many app developers don’t spend enough time understanding their users. Who are your app’s users? What are their use cases? What do they expect from the app? The answers may be different from your original hypotheses and surprise you!
- Track NPS: Make sure your current users are promoters of your app. The first step is to measure this metric continuously using tools like Apptentive or SurveyMonkey SDK.
- Use Facebook’s look-alike targeting: When you are finally ready to start advertising, create a look-alike group using your most loyal users. That way, Facebook can find potential users who are similar to your existing user base, and you can best-use your limited ad budget.
- Optimize the web-to-mobile flow: Acquiring users on the web is easier and cheaper than on mobile. Create flows that allow users to sign up on the web, and then download the mobile app later on to help them access the service on the go.
- Enable subscriptions: From a revenue perspective, try to design a subscription for your use case. A combination of low friction and breakage from repeat payments will enable to you to drive higher lifetime value (LTV) from your app. (See Blue Apron for an example of a great implementation.)
- Focus on word of mouth marketing: Word of mouth marketing is free and extremely effective. The most successful apps grow through imitation (e.g. folks seeing someone play an addictive game, or call an Uber after finishing a meeting while everyone else is desperately trying to flag a taxi).
How the app stores can make a fairer system for indie apps
It’s not clear that distributing revenue more equally among app developers is either practical or in Apple and Google’s best interests. But here are some things that Apple and Google could do to improve the chances of success for indie developers:
- Decrease influence of top free charts: Many users use the top free charts to discover apps to downloads. Instead of emphasizing browsing of top apps, Apple could follow Google’s lead and improve personalization, emphasize search, and guide discovery.
- Provide transparency into the featuring process: It’s very difficult to get featured by Apple or Google if you are a small indie developer. By contrast, the largest developers have dedicated app store relations teams who discuss featuring for new releases directly with app store representatives. Transparency into these processes could help development teams learn how to get featured in the app stores and level the playing field.
- Reward organic installs more heavily than paid installs: Many large developers can drive significant installs through ads, thereby increasing their rank and organic discovery. Apple and Google could dampen this impact by improving rewarding of organic, word of mouth, and search-driven installs.
- Weight quality more heavily in download ranks: Both Apple and Google claim to take a range of measures of quality into account, however as most developers will attest the factor weighted most heavily is simply the amount of downloads an app receives.
While the environment is tough for the independent app developer, the vast reach of mobile smartphones still make them the most exciting platform for development. While the odds are not great, the potential for striking it rich still remains.
This post originally appeared on June 6, 2016 on the blog of SurveyMonkey Intelligence, a competitive intelligence product for mobile apps.