Getting Your App Idea off the Ground: Zero to Critical Mass

September 22, 2016 - 15 minutes read

startup-growth-hacking

Getting your app idea off the ground is similar to getting a rocket into space.

Both are risky. Both take an enormous amount of fuel to reach their goal. And unfortunately, both crash and burn without careful planning.

When startup founders look up and see big brands like Instagram and Facebook floating effortlessly across the sky, it can be difficult to imagine overcoming earth’s heavy gravity to reach the same “critical momentum.”

The big question for small startups is: How do I gain enough users, brand recognition, and market traction to achieve sustainable growth?

In this post we’ll walk through the core growth hacking concepts that we’ve found most useful in the past five years steering apps from zero to profitability in the app store.

We’ll also take a look at how existing tech startups have used these concepts to achieve fast, scalable growth with limited resources.

Key concepts: “the only rule is that there is no rule”

the-best-artists-steal

There is no step-by-step process that guarantees startup growth. There are, however, patterns that we can learn from that hold true for app developers in NYC and Silicon Valley alike.

Looking at the early-stage marketing strategies of unicorn startups like Facebook and Twitter, and we can see several core concepts in common:

  1. Clearly-defined critical mass
  2. Local-first growth
  3. Carefully engineered double viral loops
  4. Clear, intuitive learn flows

Don’t worry if these terms are new to you. Let’s walk through each one in detail:

Critical mass

How many users do you need to be sustainable. Even more importantly: what type of user?

How many users do you need to be sustainable? Even more importantly: what type of user?

Critical mass describes the point when an app has enough users to sustain itself — comparable to the moment a rocket can turn off its engines and coast on orbital gravity.

Virtually all successful iOS and Android app developers follow this pattern: an initial period of hard work to gain users, followed by a “viral” period when new users come via word of mouth, brand recognition, and organic search.

Here’s an example: Reddit is famous in marketing circles for employing armies of fake users to make their online communities appear popular. The appearance that the platform was popular drew in real users. Eventually, the fake users were phased out. The point at which Reddit no longer needed fake users to grow their audience could be considered their “critical mass.”

Determining the critical mass for your app idea is a question of reverse engineering. What draws users to your app — and is the thing that’s drawing them dependent on other users? If so, what’s the minimum number of users needed to meet that need in a particular area?

This is why app ideas that rely on user-generated content (drivers for Uber, reviews for Yelp, photos for Instagram) are the toughest to get off the ground. It’s also why apps like Uber, Yelp, and Instagram are so useful to users once they have a large enough userbase to sustain themselves.

Local-first growth

The best apps, like the best businesses, start local and then expand.

The best apps, like the best businesses, start local and then expand.

Critical mass gets complicated when you consider that, by their definition, apps are available to anyone in the world with a smartphone.

A ride-sharing app with 10,000 active users in a single area might be successful; but if those users are spread out across the US, chances are users will have a hard time finding a ride in their area, get frustrated, and leave. That’s no good for users, and certainly no good for app developers.

Facebook is a beautiful example of local-first growth on a bootstrap budget. Zuckerburg made the brilliant observation that something as new as Facebook would only work if he started with the “cool kids” in an enclosed environment. This way, it appeared exclusive rather than obscure. By the time it expanded to other universities and finally to the public, users were practically clamboring for invites.

Popular YouTube filmmaker Casey Neistat followed a similar strategy when he launched his social media app, Beme, via invite codes seeded into his pre-existing audience, creating a firestorm of social media activity that drove further viral media coverage.

Localizing app networks is particularly important for sharing economy and on-demand app developers, who require substantial real-world materials and workforces in addition to in-app accounts and data. Uber, Lyft, AirBnB, and startups like Kirb that we’ve worked with here at Dogtown, all used the local market as a stage for testing their concept and proving viability before expanding to larger markets (with larger marketing budgets).

Double viral loops

viral-loop

Remember those cheesy chain emails your weird uncle would forward you back in the day? That was an example of a viral loop.

In the context of apps, double viral loops refer to optimizing your UX so that new users will invite other users, as well as re-engage existing users.

This term was popularized by Josh Elman, a partner at well-known venture capital firm Greylock Partners and former growth hacker responsible for the rapid growth of major brands like Twitter and LinkedIn.

In the case of LinkedIn, double viral loops helped build the platform’s early userbase by using an invite system carefully designed to engage as many users as possible. When users signed up, they would be asked to identify users they might know from a list. Every user selected would get a notification that they’d been tagged, along with a request to identify users they might know, repeating the whole process over again.

Learn flow

learn-flow

Designing learn flows that users won’t just click “skip” on is easier said than done.

You know how when you sign in to a new app or web service for the first time, it’ll often guide you through the basics of how to use the interface? That’s what marketers and UX designers are talking about when they reference “learn flow.”

Most of us click “skip” on these. Why? Because, honestly, they feel annoying.

…But apps that manage to incorporate learn flows into signup in such a way that users actually absorb the basics have an easier time retaining users, because first-time users don’t wind up churning out of confusion about how the product works.

Image credit: Josh Elman

Image credit: Josh Elman

Learn flows aren’t the only UX feature that ultimately determines user retention, but they’re the one that matters most in the early days after launch.

Looking forward: brand ambassadors and social incentives

Advertising has a big problem in the 21st century: users simply don’t trust it.

The “Mad Men” days of glamorous campaigns capturing user’s hearts with simple stories are for the most part extinct. Want to sell to a baby boomer? Show them an ad on cable TV. Want to sell to a millennial? Honestly, it’s not likely to happen unless a friend recommends your product.

Brand Ambassadors

Question 1: who do your users look up to? Question 2: how can you convince that person to promote your app?

Question 1: who do your users look up to? Question 2: how can you convince that person to promote your app?

App developers can emulate that word-of-mouth discovery experience by partnering with influencers or “brand ambassadors” close to their intended audience.

For luxury brands, celebrities and fashion bloggers can drive massive sales if they can be convinced (or hired) to wear, reference, or even outright promote a product. Birchbox, Sainsbury’s, and a variety of other startups have built their userbases to critical mass with the help of brand ambassadors. For app developers, the ideal brand ambassador isn’t always obvious — it’s a question of finding who has social influence in a given target audience.

For app developers, the ideal brand ambassador isn’t always obvious — it’s a question of finding who has social influence in a given target audience.

Brand ambassadors don’t have to be celebrities or media figures. Anyone with a handful of people that look to them for cues can be a brand ambassador. Finding those users and nurturing them so that they’ll recommend your mobile app to their friends — or at least share that they use it — is the gold standard of growth hacking.

Think about products and services that you’ve recommended to friends. Did any of them do something special that made them stick in your mind? Perhaps a check-in email from the founder, or a thank-you bonus for using their service?

Monetized Social Incentives

monetized-app

Let’s be honest about capitalism for a second: often, the simplest way to get someone to do something you want is simply to pay them.

While you can’t pay for users in most cases, you can come awfully close by incorporating monetized incentives into your app.

According to data at Fiksu the cost to aquire a user rose as high as $4.23 in 2016. Why pay for advertising that might convert when you can pay users to invite their friends, and essentially guarantee conversions?

Startups in every industry have been following this trend in recent years, offering sign-up bonuses and promotions for users who invite friends via social media, SMS, or direct link.

app-growth-hacking

Turo, the AirBnB for rental cars, uses monetized invites to drive user growth. Sign up at this link and you’ll get $25 off your first trip. Look, it’s working!

For those on a tight budget, offering perks like premium membership and extra features can essentially “buy” users with imaginary money. Robinhood, an app that offers free stock trading, drove huge user growth in the past year by offering instant bank transfers for users who invited friends.

This strategy is particularly useful for sharing economy startups, where the value of a participating user can amount to hundreds of dollars within the year.

Kirb, a startup we worked with recently that offers parking on demand, has seen enormous success following this strategy in the Los Angeles area. Offering free parking for users who list their parking places allowed them to build a solid network of reliable parking very quickly. While it creates substantial up-front costs for the startup to pay parking fees for early users, it’s a great strategy for building a sustainable network to turn profits for years to come.

“Growth hacking” vs “growth slacking”

growth hacking

The biggest pattern to take note of among successful startups is this: the relentless work it takes to build a tech company from scratch.

AirBnB, Facebook, Instagram, SnapChat, and all the other big names in the app store went through long periods of late nights and relentless marketing before they caught on. Great ideas always sound “crazy” when they’re new. It’s part of the spark that makes mobile apps so successful.

…But growth hacking is just the beginning of the story for app developers. In the next post in this series, we’ll jump into the logistics of running a startup with limited time, staff, and budget. Stay tuned and connect with us by liking our Facebook page to get resources like this one directly in your feed.

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