As an entrepreneur, or business owner, why would your business look for mobile app ideas? That’s a good starting question, but it is missing one critical word – profitable. This is not just wordplay. Roughly 70% of mobile app developers are struggling to break even and over 90% of mobile apps are distributed for free. We discussed the underlying factors for app businesses fails in a previous article.
So, let’s see how can you find mobile app ideas that can really improve your business. Identifying prospective ideas is a business-specific issue where the answers can be found in four directions:
- Understanding everything about your business, its activities, and market.
- Looking at what other businesses have done which have proven profitable.
- Listening to what your (existing and prospective) customers are saying.
- Engaging to find something new – possibly to expand your business.
Here, we explore the first point in some detail and provide some clues for the other three. If your business is a small or medium-sized enterprise (SME), you have an “economy of (some) scale.” Small things can have a significant impact on your bottom line.
The American Enterprise Institute provides some fascinating information underscoring that many companies have a profit margin of about 6-8%. Many contractors also contract on the basis of “cost plus x%” (frequently as low, or lower than, 3%). A fraction of one percent can be very significant to your bottom line.
Many world-class companies keep a schematic for all business activities, along with standard operating procedures, and constantly track metrics for these activities. Amazon, for instance, is known to measure everything – going so far as to test the type of paper used in picking to reduce downtime resulting from papercuts. The larger your business, the faster small things add up.
A Simple App for a Promotions Board
Let’s take a deeper look at where one major government contractor was able to find a profitable mobile application for their business idea – surprisingly enough, in their promotions program. It comprised five regional boards consisting of three managers which screen local applicants. The top three candidates would then interview with the five managers from the main office, on a monthly basis.
Each member of these promotions boards received a printed hard copy of each application, an average of 3 pages each to include the application, their resume plus any attachments. On average, each position had 6 applicants per region for an average of 12 postings per month. In total, with nearly 2 dozen managers sitting on regional and central promotion boards, this amounted to over 7,000 pages per month.
The cost of paper, toner cartridges and equipment wear and tear paled in comparison to the cost of labor to print, scan, collate and file all of this paperwork. Including the cost of labor, this component of their promotions program amounted to just shy of $89,000 yearly.
Over 85% of this overhead was swept away by a relatively simple mobile and web application enabling employees to submit their applications, resumes, and attachments digitally.
Perhaps unusual, it is a perfect example of how your metrics can help point the way to profits – with cost avoidance. Here are some other ways considering all four of the directions to examine as noted above.
Putting the High Octane Caffeine Into Mobile Apps
Starbucks started turning heads with its mobile app in 2009. By 2012, Starbucks’ mobile app was responsible for over $1 billion in sales. It;s still responsible for 24+% of all its retail purchases in North America.
Let that sink in. $1billion in sales from an app.
Listening to your customers is important, but so is listening to what prospective customers are saying. There are over 49 free apps to help people find out what others are saying about specific companies influencing their decision to do business with them.
Customers have lots of ideas and they want you to use them. Not all of their ideas are practical. But where else are you going to get such a large pool of potentially useful ways to improve your business? That’s just one angle, conducted on scale – surveys and polls, along with other market data has a dollar value, too.
An innovative idea?
Mobile applications are a comparatively new invention compared to Johannes Gutenberg’s printing press of the 1450’s. Several new technologies are rapidly making it possible to introduce lots of new ideas. From augmented reality to VR, 3D printers, robotics, the Internet of Things and even AI, we will see a world of change in how we think and do things. Where can they apply to your business?