Great Products Consulting

Category: Ideas

  • Will your platform or app make money?

    Will your platform or app make money?

    The idea of building a platform or app and having this steady stream of passive income is very attractive prospect. Unfortunately, the question of how to make money from an app is not so clear cut.

    There are a lot of factors that affect success, but often the issue is that the numbers weren’t right in the first place. It seems obvious, but it happens in business – all of the time.

    In the simplest of terms (and sometimes that’s all it takes), your financial equation is going to look at two key components – revenue and costs. In order to operate and hopefully make any money, revenue (or cash in) has to exceed costs (or cash out). I’ve put it this way, because there are many startups that don’t make money until they sell their business (and when that happens, they can make a lot of money).  However, in the meantime, they still need cash to pay the bills on an ongoing basis.

    A simple way to gauge your financial success

    Success is a relative term and a very personal one, so your definition will depends on the goals you have of a platform or app. If you want to replace your income, then that’s a different measure than supplementing your income. It will also affect your approach to building your product.

    So, a very simple gauge as to whether you can make money is:

    1. Decide how much you want to make a year.
    2. Decide how much you can charge for your platform, and an average revenue amount per customer (e.g. what’s your price?)
    3. Divide how much you want to make by your average revenue per customer.

    This gives you the number of customers you need a year to reach your target. Does this number sound reasonable? If not, you’ll need to play around with the numbers to see if you can get the required price and number of customers to more manageable amounts.  It may not be possible. In this case, your idea won’t make you the money that you’re looking for.

    Now you have to think about the costs.

    If you think you can make enough money from your platform or app, the next part of the equation is your costs.  This will include the initial development costs, but you’ll also need to include the ongoing costs of managing and enhancing your product. On top of that, you have the overheads of running a business – insurance, marketing, advertising, legal, accounting, payment providers, banking, etc. It can all add up and eat into your hard earned revenue.

    The next step is to take your revenue every year and deduct the costs. If the number isn’t positive, then you won’t make money that year. As simple as that.

    You’ll then have to go back and either adjust your revenue numbers to cover all of these costs, or you’ll need to cut back on your costs, so that you can still make money.

    But when will you start making money?

    The thing about the above revenue number is that it’s your ideal number. The reality is that you’ll need to ramp up to that number – and it will take longer than you think. This means that you won’t be making all of that money on Day 1.  The important part of this means you need to have enough money to cover your ongoing costs. Don’t spend all of your money on the upfront development!

    An important cashflow indicator is called a ‘payback period’. This is how long it takes to pay back your original investment. Only then do you really start making money (after taking out your ongoing costs). Most software development projects in corporate land look for a payback period of about 18 months to 2 years. As a small business relying on your own money, this will probably be longer, as you may not have access to the same resources you need to scale quickly.

    What next?

    The above is a very simple view of figuring out if you can make money, but it will give you a quick indication of whether the numbers can stack up. For a more detailed view, talk to an accountant or financial advisor where you can get advice on a model to suit your specific business.

    The bottom line is that it’s not so easy to make money as you might think. Even the big startups don’t actually make money yet, and their worth is based on their valuation as a business. However, if you’re a small business owner looking to enhance your income in the short to medium term, you do have to have a good handle on the numbers before you start.  Otherwise, you’ll find yourself running out of money before you can figure out if your platform or app can be successful.

    Are you ready to turn your good idea into a great product?
    My idea to launch checklist is your plain-English guide to getting there.
    It’s available now for only $24.
  • Does your platform or app solve a problem?

    Does your platform or app solve a problem?

    Ultimately, a product or service exists to solve a problem, or it addresses a need or goal of the customer or user. Without that fundamental piece, a platform or app is doomed to failure. Understanding this is an important part of validating your idea.  This article looks at what to consider, and why it’s important to understand the problem your solving when you want to build a product.

    So, what’s the problem, need or goal?

    At the end of the day, you don’t want to spend your time and effort building something that isn’t helpful to people in some way. Whether it’s around productivity or maybe just entertainment, your platform or app has to have some purpose for people to use it.

    Generally, we talk about solving problems with products. That’s because people are driven to look for products or solutions because they’re having trouble with something. Some problems are more trivial (“I’m bored, let’s find a game to play” or “I’m hungry”) and some things aren’t (“How do I do my taxes?” or “What insurance should I buy?”). Bottom line – if there’s no problem, you’ll find it very difficult to get people to use your platform or app.

    It’s not always doom and gloom, and that’s why I like talking about needs and goals too. To me, needs and goals are a variation of a problem, but with a positive intention – if you’re looking to meet a need (“I want to learn a new skill”) or if you want to achieve a goal (“I want to book a holiday in Perth”), then you’re equally motivated to find a solution.

    Regardless, in order for it to be successful, your platform or app needs to do something useful for someone.

    Is that problem painful enough for people to seek a solution?

    Your platform or app is the solution to a person’s problem, need or goal. By using your product, your clients and customers will achieve the outcome that they’re looking for. But how painful is the problem? Is it a little itch or a full-body rash?!

    If you think about the buying process, there are generally a few steps that people go through before pulling out their wallets and purses. This means that you want to make sure that the problem you’re solving is painful enough for people to go looking for a solution. If I have a hole in my sock, do I look for a hole-fixing service or do I just buy new socks?  Conversely, if you’re talking about needs and goals, then you’re thinking about how important this is to someone.

    If you’re product is free or low cost, then it’s less of an issue as it’s low-risk for an individual to try your service or download your app. People will use it as an option for evaluating different alternatives. The challenge then falls into my next point.

    Are there enough people with the problem? And how often do people have this problem?

    I’ve combined these two questions together because they speak to how many people you need to use your platform or app. You’ve found people with problems, and they’re painful enough to look for a solution. But are there enough of them?

    Unless you’ve got a high-ticket price, volume is key to any platform or app. There are a lot of overheads to cover with a platform or app. You’re looking at 10-20% of your initial development costs to keep your systems running every year. This means there needs to be enough people with the problem to use your product, so you can pay your bills. This is a really important point. Be realistic about the number of people that you can get to sign up to your platform or app when doing your financial analysis.  This is usually where a business falls over.

    Another element of the volume equation is how often will people use your product. Problems are not all equal in importance. Some problems can be solved as a one-off (e.g. buying a present) and some happen over and over again (e.g. ordering takeaway). You can solve a problem in a minute, while others take years. If you have a subscription or membership product, then you want problems that take a while to solve. For smaller problems, you want people to keep coming back every time they encounter the problem. While it’s important to have a large number of users for your platform or app, you also need them to use it again and again.

    Why should I care?

    If you don’t first understand the problem, need or goal, then it’s no point building a solution. No one will use it. “That would be cool” is generally not a good reason for building a platform or app.

    I’d also encourage you to explore the problem. This involves thinking about how painful it is. You want to understand why people might have the problem, and what motivates them to want to solve it. If the problem you’ve identified isn’t a big deal for them, then you’ll have a tough time convincing them that you have a solution for them. This research will also help you to build a better product by making sure you address the pain.

    Finally, think about how many people this problem affects. How many of them you could realistically get to use your platform or app, and how often can you get them to use it. This is critical to the long-term success of your product. Your product may be great at what it does, but without volume and consistent use, you’ll struggle to keep it going.

    At the end of the day, products are created to solve problems, so take some time to think about the one that you want to address in order to have a successful platform or app.

    If you want to turn your good idea into a great product, then my Idea to Launch Checklist is your plain-English guide to getting there. It’s available now for only $24.

  • Get from “idea to launch” with my new checklist!

    Get from “idea to launch” with my new checklist!

    If you’ve got a great idea for an online platform or mobile app, but you’re not sure where to start – you’re not alone. Tech can be intimidating for those that have never had any experience with it before. Sometimes you want someone to guide you through the process – but you just can’t afford to hire someone to help you.

    The good news is that building an online platform or mobile app is a process.  This means there are clearly defined activities that you can follow to reach your end goal. Once you know this, the whole thing becomes more manageable – you just have to take it one step at a time.      

    Introducing the idea to launch checklist

    Today, I’m pleased to introduce the “idea to launch checklist”. This downloadable checklist contains “must-know” tasks in 15 core areas, so you can turn your good idea into a great product. It provides a plain-English roadmap for your journey. You’ll see the main activities for developing a product, and the tasks involved in each step.

    The idea to launch checklist came about as a way to take non-technical people through the creation of a digital product. Like the design and manufacturing of any product or service, platforms and apps have their own brand of jargon and their own unique complexities.  This checklist needed to be written in a way that anyone could follow.

    I understand that not everyone wants to be an expert in software development. Business owners and working professionals certainly have enough things to do and learn! This checklist has been designed with you in mind. If you’re serious about building your own digital product, then the information in this foundational checklist is definitely in the “need to know” bucket. 

    Did you know that on average only 16.2% of software projects are completed on-time, on-budget and with the features and functions originally requested?

    Having worked on technology projects for almost 20 years, I’ve learnt a lot about software development – to a point where it’s mostly routine and I don’t have to think about what to do. Throw in 8+ years in product management, and there’s all of this experience that I took for granted.

    It made me realise that this lack of knowledge is costing people money.  I’m sure people would learn a lot from their experience, but I think they would prefer not to spend so much money on those lessons!

    As someone that’s been doing this for so many years, I really want to help people avoid this situation. So, I’m sharing my experiences and knowledge with people that have had their “light-bulb” idea, and are ready to do something about it.

    Here’s a taste of what you can expect from my checklist:

    • 21 ways to evaluate your idea. Let’s be real – you need to know if you’re backing the right horse.
    • 20 critical steps to finding the perfect developer. This is not the time for speed dating.  A bad decision will cost you time and money and could even delay your product going to market.
    • Plus 25 tasks that will ensure your product testing is rigorous and effective…. If you’re really going to do this, you want to do it right.

    Think about it – you can’t ride a bike the first time you try it. In fact, before you perfected riding on two-wheels, there’s a good chance you rode a tricycle or had training wheels. You also probably fell a few times.  Maybe you could only make it to the end of the driveway before putting your foot down. Eventually though, you made it to the end of the block and around the park a few times.  

    Building digital products is much the same as this. That’s just the way life is. It often takes a few goes around the block before you’re comfortable with what needs to be done. You can try it with two-wheels for the first time without the training wheels, or you can get some help to make it easier on yourself.

    This foundational checklist is all about action. I want to see you get that platform or app built, and I want you to get there in a straight-line path. So, if you’re ready to build your platform or app, click here to find out more.

  • Looking for an idea for an online platform or mobile app?

    Looking for an idea for an online platform or mobile app?

    Ideas come easily to some – but for others, it’s seems like every idea they come up with has been done already. So, if you’re looking for a platform or app idea, or even if you want to create a product or service of any sort –  but you’re not sure what to do, then this article will give you some areas to look at.

    Contrary to popular belief, most ideas don’t just land on your head.  They come about because you’ve made an active choice to look for them. In product development, the activity of looking for ideas is called “ideation”. Yes, there’s a step out there where you commit some time to come up with ideas.   

    As you start brainstorming for ideas, you need to remember two key things:

    1. In order for a solution (or product) to exist, there has to be a problem to solve, a need to address, or a goal to reach. If there’s no problem, there’s no product.
    2. The problem has to be painful enough, or the need or goal big enough for people to seek out solutions for it. If there’s no pain, there’s no product.

    So, let’s get started.

    The best places to look for ideas are in places that you know.

    1. Look at your current business or organisation

    I doubt there are any perfect businesses out there, so this is a good place to start. Whether you own your own business or work for someone else’s, think about its weaknesses or anything that might threaten its success. Are there any areas that might have a big enough problem for you to solve?     

    Also think about the opportunities in the business. Is there something going on that you might be able to leverage into something bigger? Think about all of those tools that exist to automate things or to make things more efficient. Is there an untapped market out there as it relates to your business?

    2. Look at your industry

    Next, look at the industry that you operate in. Are there any significant problems or challenges that you face? Are there any political, economic, social or technological trends that may either threaten or create opportunities for you?

    What are your direct competitors or alternative competitors working on? Is there an opportunity to do something better than them? Are there weaknesses that you could exploit?

    Look at your indirect competitors. Are there industries that are different from yours, but may be structured in the same way? What are they doing and what can you learn from them?  

    3. Look at your job role and those around you

    There may be ideas in your job role, or in those around you. As a business owner, could you leverage your strengths to create a new product or service? Maybe there are areas that you find challenging or hard to do well?   Are there other roles in your business that you’ve found problematic?  Maybe it’s hard to find good people? Or maybe the role itself has challenges? What kinds of tools could be created to make life easier for you?  

    Those in corporate land also have an opportunity to find pain points in their own roles and in those around them. Talk to other people that have these roles and find out what keeps them up at night. Is it the same as you?

    In my first article for this blog, I told the story of how I started out. I’ve worked in tech for a long time, and my idea for Great Products Consulting came out of challenges that I faced in my roles as a business analyst and a product manager. If I had these challenges as an expert, I could  imagine what it would be like for people that had never done this before. 

    4. Look at your personal life

    What problems do you face in your personal life? Maybe you have a need to fill or a goal to achieve? Think about a typical day or week, and all of the things that you do. Are there any areas where you get stuck? Are there services or products that you use that don’t work the way that you need them to? Have you had any recent experiences that took up more of your time than you thought it would? Maybe there was a particularly difficult experience that could have gone better? Conduct surveys with people you don’t know. Find out what their needs, problems, and goals are in a particular area of interest to you, and find out whether the results align with your ideas.

    5. Look at what else is going on in the world around you

    If all else fails, look in general at what’s going on in the world around you. Maybe there are some social or technical trends that you could capitalise on? Is there something going on in the economy that needs a solution? Maybe changes in the political environment have opened up an opportunity for new product ideas? This category is probably your last resort because you may end up with ideas that aren’t as appealing – simply because they’re not in your area of expertise or experience.

    Keep on looking…

    Don’t worry if your initial list of ideas sucks – or maybe something that initially sounded like a good idea, ends up being a dud. This process of looking for ideas will actually spark your creativity. You’ll find yourself coming up with more and more ideas – as long as you continue to probe into these different areas. Think of this first attempt as a warm up exercise for the real deal. You’re now looking for ideas, rather than hoping one will miraculously appear – and that will make all of the difference. Good luck and happy ideating!

    Want to learn more about building and growing your platform or app? Join our email list to receive regular updates

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  • What kind of business do you want to be? (Startup vs Small Business)

    What kind of business do you want to be? (Startup vs Small Business)

    This week’s article came about as I was thinking about the types of people that I want to work with, and how to describe them. If you decide to start your own business, are you a startup, a small business or something else entirely? Does the guy who opens a takeaway restaurant down the street call himself an “entrepreneur”? Is a contractor a “freelancer” or a “small business”? What you call yourself and how you relate to terms like these is an important part of the approach you take in building and growing an online platform or mobile app.

    The word “startup” gets thrown around a lot in mainstream and social media, but it’s a term that can be misunderstood and create the wrong expectations. In this article, I’d like to highlight some of the differences between these two terms, and why you should think about what you want your business to be.

    Startups

    According to Startup Muster, an organisation researching the Australian startup ecosystem, a startup is “an early stage business that has a large addressable market that utilises technology to capture that market quickly”.  Startups tend to have lofty ambitions that lean towards world domination, which mean they have some distinctive characteristics:

    1. High-growth with large, long-term revenue and profit potential that requires large upfront investment
    2. Potentially disruptive where existing problems are solved or business models are created, which are totally different and innovative (or they are copying those that have done this recently)
    3. Seek funding from external parties such as angel investors and venture capitalists
    4. Have an exit strategy whereby they sell their business and probably move onto a new one

    Small businesses

    On the other hand, small businesses lean towards some different goals and different ways to get there:

    1. Slower growth with short-term revenue and profit goals; where they want to make money as soon as possible
    2. Platforms and apps that are not necessarily new or disruptive, but have a sufficient market to generate revenue
    3. Initially seek funding from family and friends, loans and grants
    4. Don’t have an exit strategy; rather the business should generate the income that they’re looking for

    Why I’ve been avoiding the word “startup”

    I’ve tried to avoid using “startup” in relation to the people that I want to advise because I feel there are tons of resources and options out there to help those that want to go down that route.

    Instead, I really want to help those wanting to create small businesses from their platform or app.  There are loads of you out there!  You might be looking to grow revenue in an existing businesses or looking for a change from your corporate role. The people that I can help the most may not identify as entrepreneurs or even a small business owners (yet!) All of these people are looking to generate immediate revenue with the aim of replacing or growing their current income.

    What does this mean for you?

    If you’re an existing business looking to build a platform or app to grow your business, then this might be a prompt to rethink your overall strategy for what you want to be and where you want to go. How much are you willing to invest in your platform or app? Being big requires a much larger upfront investment. Do you have the resources to do this?

    If you’re thinking about going out on your own, then this really applies to you. Do you want to be a startup or a small business? The approach you take to develop your platform or app will be completely different based on the choice that you make. Think about your reasons for going out on your own and building your product. Which of the above definitions aligns most with your reasons?      

    Regardless of whether you want to be a startup or a small business, having clarity about your goals will improve your chances of success. So, decide who you want to be, and go about making that dream a reality!

    Are you ready to turn your good idea into a great product?
    My idea to launch checklist is your plain-English guide to getting there.
    It’s available now for only $24.
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  • Intro to Product and Software Development and Product Management (part 2 – at the beginning)

    Intro to Product and Software Development and Product Management (part 2 – at the beginning)

    In my last post, I introduced you to the concepts of product management, product development and software development. In this post, I want to bring it all together and explain what it means to a non-technical person starting on their app development journey. This all might seem a little daunting, so for now, here’s what you need to know:

    Product Development

    “Ideation” and “Analyse” are the most important parts of product development. In these phases, you need to be able to come up with an idea and see if it’s worth building:

    There are lots of different ways to come up with ideas for an app – but most usually come from personal experience – either at work or outside of work. Look for problems in your day-to-day life that might need solving.  Maybe it’s something in your industry or something in your job role.  Maybe it’s something at home, while travelling, parenting – the possibilities are endless!  

    After you have an idea, you want to make sure it’s the right one to pursue.  What makes you the right person to build this app?  Where might you need help? How big is the market? What’s the competitions like? There are lots of ways to evaluate your idea.  If you don’t validate your idea, then the rest of the process is really irrelevant. Validating an idea is about making sure you don’t want to waste your time and money on building an app that doesn’t allow you to achieve your goals.

    The product development process has natural “gates” that give you permission to stop what you’re doing and to go onto the next idea. If you don’t think your idea is good enough, keep repeating the “Ideation” phase until you have an idea that is more desirable. In the “Analyse” phase, if the idea doesn’t pass your validation criteria, you go back to the “Ideation” phase.

    Click Here
    To learn more about idea validation

    If you’ve decided to go ahead with developing your idea, you’ll then need to “Define” your product. This is about writing down what you want your product to do. This is an important process because it dictates how your product will end up!  Spend some time here really understanding the processes that people will go through, what you want them to do, what they’ll want to do and what information needs to be captured and stored. Also, consider all of the processes that might be involved in running your app – for example, how will people contact you if there is an issue? How will you respond to them? etc.

    Software Development

    The “Requirements” phase of software development overlaps with the “Define” phase of product development, so your defined product also forms the basis for the Requirements phase. The Requirements phase in software development will focus on the actual app being built; whereas the Define phase will look at everything that’s need to deliver and run the product.

    This phase is about telling people about what you want build – which makes it pretty important! If you can’t articulate what your product should do, then you might end up with something that is vastly different from what you expect. You’ll then spend a lot of time and money trying to make it right.

    Developers use the information that you provide about your product to estimate the cost of building it. This means that you want to be very clear about what you want your app to do. A lot of projects end up costing more money and take more time to complete because new things come up later in the project.

    Product Management

    Your product hasn’t been built yet, so the elements of managing the product through its lifecycle don’t come into play yet. However, you’ll want to start thinking about who your first users will be as you enter the next stages of building your product.

    What happens next?

    After you’ve figured out what your product needs to do, it’s time for you to start building. In our next article, we’ll look at getting your app designed and built.