10 steps to becoming an iphone app millionaire

28 June 2013

Nick D'Aloisio, a 17-year-old schoolboy from south London, was supposed to be sitting his A-levels 2013. But he deferred for a year after a busy few months when it hasn't been possible to fit in much work. D'Aloisio, if you don't know the name, is the youngster who sold his smartphone app to Yahoo in March 2013 - the price tag for Summly, an app offering short summaries of big news stories, was never disclosed, but those in the know put it at £19 million.

Summly's valuation wasn't a surprise to technology sector analysts - apps are big business in a world of smartphones and tablets, with the potential to generate huge revenues. The Angry Birds franchise, for example, has now clocked up more than 1 billion downloaded games - 10 times more sales than Michael Jackson's Thriller, the best-selling music album in history.

However, while there are potentially massive sums at stake, the app business remains remarkably accessible. Anyone can build an app, the cost of global distribution is tiny and if you find yourself with a hit on your hands, profits mount up quickly.

But the market is crowded and competition is fierce: five years ago, Apple's App Store had just 800 apps for sale; today there are more than 800,000 available. Against that, demand is huge - market analyst ABI Research reckons mobile users will download 70 billion apps in 2013. Here's our guide to capturing a slice of the action.

1. Have an idea

This is the trickiest bit, but remember that apps exist for all sorts of purposes. By and large, successful apps fall into two categories: either they're great fun or they serve a really useful purpose. Try to draw on your own experience - is there an app you've looked for in the past but been unable to find? What would be indispensable in your life? Talk to friends and family too - what are they looking for?

It's not imperative to reinvent the wheel. You can't pinch other people's ideas but you can improve on what they've come up with already - if you come across an app that only does half the job it's supposed to, think about whether you could design something that works better.

2. Do your research

It's important to make sure someone hasn't already come up with your idea - or something very similar. Not only will this reduce the potential market for your app, but also, you put yourself at risk of legal action. Check all the app stores for ideas that look like yours and make sure your product has clear differentiation.

Focus groups are a great way to test your ideas without committing yourself to doing any development work. Assemble ad hoc groups of friends and family to get feedback on your vision for your app - is it something they would use, let alone buy?

If your focus group results are poor, or your market research suggests someone is already doing the job well, don't press on regardless. It might hurt to junk your first idea at this stage, but you'll save yourself time and money in the long run. Go back to the drawing board.

3. Pick an operating system

Where will you sell your app? You'll need to build the app in a different programming language depending on the answer. Apple's default programming language, for apps sold through its App Store, is Objective-C. For apps that run on devices using the Android operating system - and sold through stores such as Google Play and the Amazon App Store - the language is Java.

Don't despair if you haven't got the first idea about either programming language. One option is to teach yourself with online tutorials (see General Assembly, Steer, or Code Academy for details of courses) or even good old-fashioned books (see, for example, Objective-C for Dummies).

Alternatively, sites such as App Inventor (appinventor.org) and Game Salad (gamesalad.com) allow you to build your app on them, with the technical stuff hidden in the background.

4. Find a developer

If you really can't build the app yourself, find someone who can. Unless you have really deep pockets, they probably won't be a professional app designer - their services are so highly prized that day rates often start at £1,000 or more.

The simplest solution is to find a technically-minded partner with programming skills that complement your vision. Is there someone in your circle of family or friends who fits the bill? It may be you'll have to work on the app in your spare time, delaying its completion, but you'll get there in the end.

Another option is to approach local schools and colleges - are there students working on IT courses who are looking for opportunities to hone their skills? They may be prepared to work for modest fees, or for a share of future profits.

Alternatively, there is, naturally enough, an app to do the work of a developer. MEDL Mobile's App Incubator, available via the Apple store, invites would-be app moguls to submit their ideas. If MEDL likes it enough, it will do all the development work and split the profits with you.

5. Keep it simple

This is an area where you may have an advantage over IT specialists - apps work best when they're incredibly simple to look at and to use, and you don't need IT skills to have that vision. All sorts of practical advice on what works well is available for free online. Try the online tutorials at creativebloq.com for starters.

6. Submit your app

Apple vets all apps sold through its App Store, so you'll need to submit your product for approval before it goes on sale. The approval process bars anything obscene straight away, but also includes basic quality criteria. You'll also need to be very clear about the technical specifications of the app - what devices it will run on, what versions of operating systems are required, and so on - as well as when you want it to go on sale.

Android apps don't require pre-approval. But go through the quality control checks in any case - if you release an app only to find it doesn't work on certain devices or systems, you'll have unhappy customers to deal with. That's not a recipe for success.

7. Start marketing

The power of social networking sites is huge, so go to work on Facebook, Twitter, LinkedIn and the rest - and get your friends and family to do the same. Building simple webpages to support your app may be a good idea and you should certainly look into the small business services available on Facebook. Just keep making noise.

Don't forget more conventional sources of publicity. Try pitching your ideas to reviewers, both online and offline, and if you've got an interesting back story to tell, so much the better. You will need to get noticed, though - work on a pitch that gives the name of your app and what it does in fewer than 80 characters.

8. Offer a teaser

Many apps are available in two forms. Users are invited to download a free version of the app first - these 'lite' versions allow people to try the app out, but offer limited functionality. Once your users are hooked, you give them an opportunity to pay for the full version of the app. Selling this way has a big advantage: you're not asking people to part with cash for an unknown quantity, which is much tougher than selling them a better version of something they already like.

Similarly, in-app purchases are an increasingly important source of revenue for many developers, particularly for games. You can charge people additional fees for new features - to skip difficult levels in a game, for example.

9. Find a wholesale buyer

This is your exit strategy. If sales do take off, you can carry on banking the revenue while working on product development or entirely new ideas. Or you can look for a buyer for the rights to your work - an established games developer or a business that already offers services with which your app represents a good fit. You may want to continue working with the buyer or to disappear into the sunset - either way, take legal and financial advice on any sale.

10. If at first you don't succeed…

If buyers don't bite, don't get disillusioned. Entrepreneurs who've made it big have often had a string of failures from which they've learnt important lessons.

Just ask Nick D'Aloisio. His first app, a treadmill for fingers, made just a few hundred pounds worth of sales. And TouchWood, his second app (it gave the screen a wooden effect and sound when you knocked on it), was a freebie. Third time lucky then.

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