Key mobile themes from the 4/15 NY Mobile Startups Meetup
Yesterday’s NY Mobile Startups meetup featured an exceptional lineup of mobile experts, including Semil Shah, Steve Cheney, Jordan Cooper and Sarah Paiji. Over the course of an hour, the panelists discussed a wide range of topics in mobile - from mobile commerce to iBeacons to contextual targeting - and underlined some of the trends I’ve been seeing in the market. To capture this conversation, I’ve summarized the key themes below. Special thanks to Shai Goldman for moderating the panel and Chieh Huang for organizing the meetup.
1. Look beyond the App Store for distribution
We’ve all heard entrepreneurs complaining about the challenges of app store distribution. ASO is difficult, getting featured by Apple or Google is next to impossible and sophisticated marketing tools don’t yet exist. Even if an app is doing well, it must compete against established players who either have first-mover advantages or deep pockets to spend on install campaigns.
With so little control over their destiny, apps must look beyond apps stores and embrace classical web strategies to rise above the fray. To me, this simply means thinking about marketing in a holistic way and using channels like PR, content, email marketing and SEO-optimized landing pages to drive people down the acquisition funnel.
Jordan challenged the audience to think outside the box when devising a mobile distribution strategy. He recommended that entrepreneurs find new ways to break their app store dependency, in particular by transferring the responsibility for distribution to third parties. His company, Wildcard, which powers the infrastructure behind card-based mobile interfaces, is a great example: it relies 100% on its partners (eg Twitter, ecommerce apps, etc) to scale.
2. Drive engagement through context
Another classic complaint in mobile is that people are unaware of the value that apps can deliver in specific moments and places, which contributes to low engagement. Much of this is due to structural issues of a small UI paired with the growing number of apps on people’s smartphones.
On Android, companies like Cover and Aviate have been attacking this problem by surfacing relevant apps on the cover screen and via the launcher. But they also complicate the UI of the underlying OS, which is why Apple does not allow them in its ecosystem.
For apps, surfacing value in the right context is paramount to driving higher engagement. They simply cannot rely on people to develop a usage habit. According to Semil, there are two ways to do this:
1) Hardware: Using hardware sensors like the camera, GPS or bluetooth low-energy to determine context. One of the most common examples of this is geo-fencing a specific location which triggers a custom push notification. With iBeacons, for example, a big box retailer could automatically be notified of an in-store pickup as a customer arrives in the store’s parking lot.
2) Software: Developing intelligence around past customer behaviors to personalize the future experience. Sarah noted that traditional ecommerce companies like Amazon have done a great job in this area with sophisticated recommendation engines and behavioral tracking. She added that deriving insights from data is even more important in mobile, where small screens give apps fewer opportunities to correctly guess their customers’ preferences.
3. Develop a strategy for unanticipated intent
While apps may serve a great purpose for anticipated intent (eg Kayak for travel), the existing mobile ecosystem makes it difficult to find the right solutions for unanticipated intent (eg I need to address a problem right this minute). According to Jordan, this leads people to look for answers in the mobile web, which often lags the native experience on important metrics such as conversion.
To better serve their customers’ needs, mobile entrepreneurs should optimize their presence for the mobile web, either by adopting card-based interfaces or creating specific funnels that drive people to the app store. Simple tactics like adding an app store overlay module to webpages, enabling an SMS option or capturing people’s emails are a step in the right direction. While recent stats show mobile apps in a dominant position over the mobile web, this is bound to change. Entrepreneurs who successfully link the two ecosystems will capture both types of intent and anticipate the pendulum swing in the opposite direction.
4. Understand people’s reality to drive behavior
One audience member was baffled that B2B customers were singing praises for his app, but not actually using it. In response, Steve noted that:
It’s difficult to change behaviors with mobile technology
You could even argue that behavioral change is more difficult on mobile than web because it involves reaching for a device, unlocking it and finding the right app. Even big names like Square Wallet have missed the mark here, despite building very polished products.
To drive behavioral change in mobile, it’s important to understand whether your app is a “painkiller” or a “vitamin,” according to Sarah. Behavioral change is much easier for the former because it involves mission-critical work, whereas it’s more difficult with the latter because existing behaviors are often good enough. The best way to gather key insights on these behaviors is by asking customers directly and mapping out the process/flow that an app replaces.
5. Build a lean full-stack team
From an investment standpoint, building a great mobile product today is harder than ever. Jordan noted that rising development costs and the need for a full-stack team have make seed rounds in the $500-750K range not viable. He believes that a figure is now closer to $1.5M. This puts additional pressure on mobile teams to build breakout products, many of which stand out through finesse and polish (“the last 10%”).
Steve offered a potential solution: look for top talent among inexpensive offshore teams, like the new crop that’s emerging in Eastern Europe and South America. His company, Estimote, took this route by setting up shop in Poland and attracting developers from top-tier companies like Google. He also noted the number of skilled programmers graduating from college in these markets is greater than ever before, which opens additional opportunities for efficient development.
The challenges of mobile are many, but the promise of rapid growth in the steps of Instagram, Tinder and WhatsApp will continue to fuel excitement for the medium. As the panelists at NY Mobile Startups meetup observed, the winners will be companies which tap into a core human need, develop new ways to circumvent existing distribution models and drive engagement through meaningful, contextual interactions.