All to do

At first glance, it might seem that this market is highly fragmented – in which anyone with minimal development knowledge can create an app – and that the business possibilities are scarce, as there is a lot of competition. But “we are at an initial moment of what is going to be a great market. In the not too distant future, everyone will have a smartphone with access to apps. It will be a greater phenomenon than that of the web. Now there will be close to a million apps, but there will be 100 million ”, says the entrepreneur Óscar Hormigos.

When someone, with those minimal development skills, decides to face the task of creating an application and finds himself in this environment – a million different apps, different business models, various operating systems, etc. – what does he do to launch it? How do you sell it, where, to whom, at what value …

Returning to the starting box, any business –be it online or offline– requires a prior study and analysis of feasibility , because they are all governed by a market in which there are competitors, barriers to entry, customers, financial needs… The opposite would be to condemn the project to failure before even launching it.

To develop an application and launch it on the market, obviously, it is also necessary – mandatory – to make a business plan and more when we talk about a global market with exponential growth.

Where to start?

The market? As we said before, it is an open sector, which is in its first stage of development, which offers many business opportunities … But, where to start?The first step is –as Hormigos explains– “to reflect on what need the app that we want to develop covers. At Wake App, we understand them as tools and focus on detecting what new needs the app in mind would cover. Once we are clear that there is a real need for that idea, we look for what apps on the market cover that need and how they do it, to find out if we can really add value. Many times we find that they do not exist, that is, we look for ideas that are not yet on the market. And when they appear, because it is a very fast and live market, we try to generate value with new functionalities and interactions ”.

From there, the second key arises : thinking of the app as the origin of the idea. “We did not adapt an idea from another medium and turned it into an app. We are thinking that a certain application will be in Android (Google’s Android Market) or iOS (Apple Store) and that, depending on the device, we will develop functionalities (mobility, that is tactile, that offers contextual opportunities for different uses, etc. ), that is to say, that we have already thought about these opportunities from the beginning, with which the app is always the origin of our thinking; not that we have seen a website or a book and then think that it can be turned into an app, ”says Hormigos.

In addition to those aspects, you have to decide if you want to develop your own or third-party apps . Entrepreneur Jorge Antonio Rodelgo, another of the main application developers, stresses that “it depends on the economic-financial strategy you have chosen. When we start, in order to survive and continue growing, we need to provide application development services to third parties. Most of our developments are made to measure. We have made more than 200 apps (with just over two million downloads) for large clients. And now that we are already established in the market, our model is oriented towards making our own ”.

Entry barriers

With respect to those that existed three or four years ago when the first developments began, the barriers to entry have changed: “Basically, before it was the novelty of the channel. The biggest problem was going to count the opportunity to carry the Internet in your pocket when people were used to the Internet that the operator portals offered then, with very limited navigation or with devices that allowed access to content, but in a very remote ”, says Raimundo Alonso-Cuevillas, expert in app development.

Another barrier was ignorance about the apps themselves. “People associated mobile content with downloading wallpapers and nobody could assimilate that you could have so much power in your pocket with apps.”

Now, despite having spent so little time, it is easier. “In fact,” continues Alonso-Cuevillas, “it is a more stable market. People trust him. I really notice the difference from 2008, when we were telling this to potential clients, who didn’t even listen to you, and now we work almost more on demand. It is easier because there is much more information, it is a consolidated channel, which has proven to be profitable and also because there are many examples to look at ”.

Paradoxically, the current barriers have more to do with that opening in the market that encourages anyone with minimal technical knowledge to develop an app, that is, that the competition is greater. Something similar happens with what happens in the web development market. How to overcome that barrier?The expert Antonio Enrique Rodríguez points out that to differentiate ourselves, “we use experience. Every time clients prefer more developer companies than freelancers, not because the latter lack knowledge, but because clients want the apps but also the added services (maintenance, backup …). The client usually asks you for a specific development for a platform (mainly for iPhone and Android) and, then, that we do the same for less known platforms. We have the capacity to respond and the resources. “

The target audience

We must also assess what our target audience is , “because iPhone users are not the same as Android users. For example, Android are mobiles from several manufacturers, economically more accessible and with a lower purchasing power than those with iPhone. We must not fall into the mistake of making an application and putting it on all platforms, because it will not always work the same, “says Rodelgo.

Another element that this expert highlights is what is known as the conceptualization stage of the app, “phase in which you have to analyze what functionalities you will include, how you will interact, what usability it will have and a graphic design consistent with all this.”

Maintenance is also important for this expert so that it does not become obsolete : “There is no use hanging it, not updating it and not listening to the criticism made by users of your app. If so, it will be a matter of weeks before it is forgotten. ”

How to sell an application?

Choose how you launch it to the market: paid or free? For one or several platforms? Identify what your target is, where it is and how to get there. And then, campaign on networks, specialized media, and even other apps. Jorge Rodelgo highlights six ways to earn money with an app:

1.- Payment model . You upload the app to a store and put a price on it. “It is not highly recommended, because you are one of the world of world apps and not all of them make money.”

2.- Freemium . Users download it for free, “and there are extra features that are paid”.

3.- In app . It is free and is enriched with paid content.

4.- In house . They are custom developments for business environments. For example, a CRM. “They are not going to have many users, but it will be used by the clients of that company.”

5.- Subscription . It is free and a temporary subscription for services is paid. “They are recurring income. For example, Orbyt ”.

6.- For advertising . It is earned by advertising integrated into the apps themselves.

Rodelgo recommends combining several models. “Ideally, they should be free and then think about what paid services to develop around them. Or have a free app to get brand image. You don’t monetize it, but it’s an important intangible. ”

Shop or stores?

In addition, you must assess on which platform or platforms you will upload it . The main developments are made for iOS (Apple’s Apple Store) and Android (Google’s Android Market), but there are for Ovi Store (from Nokia), Mobile Store (from Windows), BlackBerry Store (from RIM) and Palm Pre Store ( from Palm). “ Apple Store has a very restrictive policy, because it says who can publish and who cannot, depending on the content and the app. However, the Apple Store model, even if it takes a 30% commission, is valid because the payment is centralized and access for users is very easy, ”says Hormigos.

When you publish on iOS or Android, you decide in which countries you register them. “If your market is going to be global and your app will be available worldwide, communication must be global,” adds Hormigos.

Alonso-Cuevillas –who has launched hundreds of apps with millions of downloads– explains that there are two ways to promote it. “The meritocracy: the most downloaded occupy the first positions in the ranking. And another is that Apple decides to promote you based on interest, how well it is made, etc. ” The stores renew the content every two or three days to give the feeling that there is new content. “Those stores reward applications with many downloads in a very short time and also penalize those that go down a lot in that time. They try to generate that there are always new ones so that the clients enter continuously. This is good for the user, but bad for the developers, because you can go up a lot in a short time or go down very fast ”.

Development costs

Depending on the type of app, investments can take between one and two months to develop, with a cost of between 10,000 and 20,000 euros, and developments of a minimum of six months, with a cost of between 100,000 and 200,000 euros. “And that has to do with the depth of the app, the complexity, the integration it has with external services, etc.”, says Alonso-Cuevillas.

No less important, are the marketing costs. Once developed, what do you do to be downloaded among thousands of other applications? Use app positioning and promotion services, talk on the main blogs in the sector or advertise your app in other apps, and all that costs money. It develops apps whose functionalities share things on social networks, because it makes it viral, ”says Rodelgo.

Alonso-Cuevillas affirms that agencies specialized in positioning the app have been born, “because if thanks to that positioning you manage to capture only 1% of the 100 million downloads per month of paid apps (we are talking about a million downloads per month at a dollar), you will have generated a million dollars ”.