Mobile first. Period. That’s it! Every CMO, businessman, entrepreneur, today knows the importance of mobile as a touch point for transpiring sales. Therefore, it’s probably a no-brainer to have an app that supports your business and ensures that you are providing the best experience to your customers at every digital touch point.
But that’s a perfect strategy for those businesses that are already established; their apps are an added ‘convenience’ provided to their existing customer base. But what if you are launching your app as your first ever product/platform to provide service/solution to your customers?
How do you know the market potential for your app? Here are three aspects to consider:
Let's examine the importance of these aspects with one example of a B2B and a B2C app each.
The potential customer base depends a lot on whether your app is serving a B2B or a B2C market. As a general rule, B2C base is always much broader (and easier to crack! J) than the B2B market segment.
When you have a B2B app that is your single mode of business, most of the times it will be for a very niche market segment.
So, if you are serving a very niche B2B market segment, then you must figure out the next two factors very seriously – Value Differentiation and Frequency of Usage. Unless you have a high frequency of usage, you might not make any profit through your app business. (Spoiler alert: apps have size and price limit, with average non-gaming app price in 2016 on App Store at $1 only).
Assume that you are launching an app for the IT Networking Industry (a very niche segment). A little research will show you that this market segment is already a very constricted base of prospective users. Additionally, this is a market segment that is already dominated by several players. Given the nature of the industry, chances are that the real need to be working on an app is very low. Clearly, the value proposition of your app has to be distinctive with a high need for repeated use of the app.
If this is not the case, then the odds are high that you will not make much out of your app. Because in this wide world of apps, you need to utilize the paid social media promotions and build engaging content for creating awareness, engaging prospects, nurturing them, and generating actual users.
These will be recurring costs for filling in the top-of-the-funnel and have decent bottom-of-the-funnel conversions; and unless you have volumes of prospects downloading your app, you will never be able to get a good ROI.
On the other hand, the above scenario changes to a great extent if you have a B2C app. For example, you are launching an app that allows users to place orders for ‘homemade dinners’ within 5 miles of their chosen zip code.
While the food industry is also dominated by many apps, you can still hope to maintain a profit margin if your value proposition is great and your targeting for social media advertising is precise.
Secondly, in case of B2C, the volume of prospective user base compensates for the lower pricing of the app. Here you can still hope for making some money.
What do you think?
Share your thoughts in the comments section. As always, we love to hear from our readers.
Mridula is an experienced Digital Marketing professional, and loves to write about topics that make a difference in your online marketing strategy.
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