Millions of applications have been developed around the globe. Billions of dollars are invested in creating new applications that promise to change the world. How does one go about selling it if you have such an idea?
Selling an app idea involves the following steps:
1) Identifying Your Target Audience.
3) Doing a SWOT Analysis.
4) Developing A Monetization Strategy.
5) Attracting Potential Investors.
With that said, though, having a good idea only tells half the tale. If you aren’t ready to go through the grunt work that follows, you might not be able to sell your app idea.
Luckily, we’ve written a detailed guide about everything you need to know to sell your app idea out to the world.
Identify Your Target Audience
An application follows the same premise as a product or a service. Knowing your target audience plays an integral role in best identifying your interests. For example, if your application is meant for children, your marketing campaign must solely focus on that target audience.
Identifying your target audience requires the identification of the best-case scenario. Essentially, what particular individual carries the most likelihood of using your application. Once you’ve gotten a hold of that metric, all you need to do is quantify it to a broader audience, and you’ll be good to go.
Prototyping is the process of creating a model application that acts as a guideline for the final product. While your application does not need to be entirely functional, your prototype should settle in as a proof of concept.
We recommend using basic prototyping tools like Proto or UXPin. With them, you’ll be able to create a basic layout of what your application is supposed to do. Remember, coding experience is not needed at this stage. However, if you can create a working prototype, you’ll be able to appeal to a broader audience.
Remember, since you are selling an app idea and not a finished product, it is completely fine if your initial prototype has some rough edges. All it needs to do is convey our message appropriately.
Before you go about the entire prototyping process, we recommend testing your idea out with a small sample size of the target population.
Perform A SWOT Analysis
A SWOT Analysis helps provide potential investors (and even yourself) with a clear picture of how your application may perform. Plus, it acts as a great primer for elevator pitches as SWOT reports are quite easy to read and convey a lot of information in a short period.
Here’s a template that you can fill in for your app idea:
|App Idea SWOT Analysis|
|What are the advantages of this application?|
|About decision-makers: what are their key resources/competencies?|
|How will this application positively the target audience?|
|What are examples of where this type of application has succeeded?|
|What Issues does this application avoid/not address?|
|Does this application lack somewhere?|
|What are the potential failures of this application?|
|What are some potential gaps in this application?|
|Any beneficial trends?|
|New technologies or other resources?|
|New needs of the impacted population?|
|Obstacles to overcome?|
Can’t copy the spreadsheet above? No worries, here’s a link that you can use to duplicate the sheet!
We recommend updating your SWOT analysis at least once a month. Staying on top of your research and identifying your competitors helps you create changes and re-evaluate fiscal decisions.
Develop Monetization Strategies
Investors will not be betting on your idea unless they see a clear way of them making their money back. Therefore, you’ll need to have a very solid understanding of how you can monetize your application once the time comes.
Here are a few common methodologies newer applications have used to turn up a profit:
- Free & Paid: Offering up a trial version with limited functionality and then opting users to pay for the full experience is great if you know your idea is solving a problem that users would pay to get rid of.
- Subscriptions: A small recurring monthly fee makes more sense if you have a service-oriented application. In it, your application will always remain free, but to access all of your services, users would need to pay a monthly fee.
- Ad Placements: If your application caters to a larger volume of users and has a broader target audience, going for ads might just be worth your time. While slightly annoying, you can always have them removed forever for a small fee.
- In-App Purchases: If you are developing a game or an application with some sort of perishable resource, in-app purchases are a great way to monetize your product without hindering users from enjoying most of its core functionality.
- Sponsorships: If your application is platform-based and is projected to have a large audience, you can have different brands pay for sponsors/referrals in your application. Generally, this leads to an inconsistent but lucrative income stream.
Going for over-the-top profit projections can lead to investors banking in on your idea only to realize the fraudulent behavior later on. It is completely unethical and must be avoided at all costs.
Once you’ve figured out a monetization strategy, identify your estimated profits based on audience projections. Keep them as grounded and as realistic as possible to maintain investor confidence.
Attracting Potential Investors
Alright, we have our application idea, a prototype, an accurate analysis, and an understanding of how to monetize our idea. We are now ready to reach out to potential investors with all that.
Generally, there’s no formula to finding an investor. However, a few methods have been employed by various developers/entrepreneurs that allow you to interact with individuals who may be interested in your idea.
Method #1: Using Investment Databases
Websites like Crunchbase are excellent places for potential entrepreneurs like yourself to find like-minded investors. You’ll be able to filter through exactly what kind of investor you’d like to get behind and will be able to contact them directly.
Method #2: Angel Investments
If you are in it for the capital and not the expertise, Angel investments are a great place to start. You receive all the money you require but do not get an active, engaging investor. This might be a blessing in disguise for some. But, for newer entrepreneurs, having no guidance can be quite challenging.
Method #3: Crowdfund Your Idea
Websites like Indiegogo and Kickstarter have successfully crowdfunded multiple app ideas and projects that would have never come to fruition if the entrepreneur relied just on conventional investors. Therefore, if you feel like your idea appeals to the masses, crowdfunding is an excellent way to get investors who are truly dedicated to your idea.
When all’s done and dusted, you’ll now be able to start developing your application or might’ve already sold all of it for a lucrative profit. In any case, getting a good app idea is only part of the tale. The effort, projections, and perseverance at the end shine through.