How To Conduct Market Research For Your Mobile App Idea?

When it comes to developing a mobile app, it could either turn your Business into a successful venture or spoil your business plans. Today’s entrepreneurs are eager to bring their mobile ideas to the market. It does not matter which type of app you are developing but researching a mobile app idea is something you must pay attention to.   

Research from Inc.com says that around 2/3 of apps get less than 1000 app downloads in the first year. The reason behind the failure of apps is the lack of market research.   

Let’s throw some light on statistics-  

According to Business of apps, “143.6 billion apps were downloaded in 2021″. Statista says, “there are around 3.55 million apps on the google play store while approximately 1.6 million apps were available on the app store. Hence, we can understand that app industry is becoming huge.  

But it does not mean you will roll out mobile apps instantly just because everyone else is doing it. Building an app without doing research is irrelevant.   

In this article, we will delve deeper to make you understand the 3Ts that make the product launch successful, why 90% of startups fail when it comes to launching the product, a glimpse of market research, and the steps involved in doing market research for mobile apps.  

What are the 3Ts?  

1. Target addressable market (TAM)   

One of the most significant parts of launching the product is the target addressable market. TAM refers to the identification of total demand for a product or service in the market.   

TAM is important for business owners as they get to know the total revenue generated by the Business for a particular product or service.   

TAM enables business owners to check the potential opportunities available in the market so they can know whether launching a product becomes a success or failure for them.   

A lot of business owners fail because they fail to understand TAM.   

Let’s take an example of a SAAS company that specializes in selling project management software. TAM for the SAAS-based startup is the company’s total revenue from selling project management software. A company can understand the potential of its products before launching in the market. Therefore, TAM proves a goldmine for investors.   

2. Timings   

Timings are another factor that makes the product launch game successful. For Instance – Your product fails when ideas come up late in your mind, and your competitors have played the game.   

On the contrary, if you come up with a quick idea and have created a strategy to turn your idea into a goal, but customers are not ready to accept it, then you are on the wrong track.   

Let’s take the example of PALM mobiles – Palm company launched 2 innovative products in the market, but they failed to get acceptance from the users. In 2005, Palm mobiles came up with the idea of launching I-Pads for customers, but there was not a single customer ready to buy them because the product launch timing was inappropriate.   

3. Core team   

The third element of launching a product is the support of team members. When the core team members understand the mission and vision of the product, then they can go in the right direction.    

The launch of a product becomes successful when everyone is involved in it.   

Hence, if any of the above elements (TAM, Timings, and core team) is missing in your case, then you are likely to lose the game.  

Even in Shark tank, most company pitches were rejected because it lacked these 3 ingredients – TAM, timing, and team.   

Let’s talk about the statistics which show the failure of startups –  

There are millions of startups launched every year. Research says more than 9 out of 10 startups fail. Not only this, 10% of startups fail within the first year. The reasons behind shutting down startups are numerous.   

When it comes to launching a product, there are 2 mantras that we have observed –  

•  Fail fast   
• Fail forward   

Why do startups fail product launches?

1. Timing is not appropriate   

Business owners suffer a potential loss when startups launch the product within the wrong timeframe. Most startups commit the mistake of launching the products on the go as soon as the product gets ready.   

Hence, it becomes important for startups to educate their customers first and do the relevant market research before coming up with a product launch.   

2. No market need   

Many startups fail while launching their products because they do not identify the need of the target audience. They do not invest their time in studying the pain points of target customers.   

Startups follow this path to launch the product-   

Launch the product – Identification of customer needs   

Instead, entrepreneurs should follow this approach –  

Identification of customer needs – Launch the product in the market   

Consider an example of google glass. Google launched an innovative product called google glass. However, it was not accepted by most customers as there was no need to come up with such a product, nor were the customers interested in wearing the glasses. Hence, this product failed   

3. No competent team members   

Launching any product proves to be a goldmine when all the team members are on the same page. You cannot turn your business idea into a successful venture when your team members do not possess the necessary skills and competencies to perform a task.   

For Instance – There was a MedTech startup named Theranos. The company was founded by Elizabeth holmes, who quit the Stanford university at the age of 19. The company promised to change the blood testing industry by launching new technologies.   

In a nutshell, the company failed because the team involved in the startup was incompetent.   

4. Not setting a suitable pricing model   

Before launching the product in the market, you need to understand the target customer’s persona and purchasing capacity.   

A lot of startups failed to decide the appropriate price for their offerings. Setting a higher price let the customers go away, and offering the product at a lower cost might put you at a loss.   

What is market research?  

Market research involves collecting information about the needs and wants of customers, what customer expectations are, and whether your product matches their expectations or not. It becomes necessary for organizations to conduct market research so that their efforts and time are well-spent in launching the product.   

HubSpot says,” Market research plays a pivotal role in evaluating the success of a product.” Understanding the customer’s persona gives you an overview of your target group and how you can provide more value to them.   

Once you perform market research, you can offer the best products to the customers while improving their overall customer journey.   

Let’s understand this with the help of an example – There was a taxi app named “Hailo,” and the company got massive success in Britain. They decided to expand their presence in the USA. The company failed while launching the product in the USA. The reason is pretty simple. Hailo company did not conduct market research.   

Importance of Market Research for Product Launches

1. Get to know about customers.   

Through market research, you can serve your customers in a better way. The market research gives you a competitive advantage where you can effectively study your customer persona and reach out to them.   

Here, the one size fits all approach will not function effectively as every customer is different. When you understand the needs and preferences of your target audience, you can market right products to them.    

2. Help you do the SWOT analysis.   

By conducting market research, companies can perform a SWOT analysis where they can identify their strengths, the areas in which the Business is lacking, the potential in the market, and the current threats that could affect your Business.   

 3. Helps you to validate a product idea   

Market research helps startups analyze whether there is a demand for the product in the market. When launching the product in the market, you need to consider which type of customer your product is catering to and which kind of need the product will satisfy.   

Additionally, the timing of the product should matter a lot. Launching a product too early in the market when there is no need or launching a product too late when your competitors have already played their part. Both things are going to spoil your game.   

Market research lets you know how your product should look and frame the marketing strategies accordingly.    

4. It reduces the chances of failure for startups   

According to CB Insights, 35% of startups fail because they launch the products without knowing whether there is a market need or not. Market research helps these startups identify the need first and then develop products accordingly.   

Steps for conducting market research for mobile app ideas?  

1. Validate your mobile app idea   

The first step in conducting market research for a mobile app idea is validating your product idea. Here, a business owner needs to identify the need in the market. If there is no need for the product launch in the market, your idea proves wrong.   

To ensure whether an app idea has potential in the market, start talking to people and send questionnaires to the customers, run a survey, and get feedback from them. Hence, you can figure out whether this app idea could meet the customer’s needs or not.  

2. Identify your target customers   

If you think your app can serve everyone’s needs and is created for everyone. Then, it is for no one. A clear understanding of your target audience can help you spot the right opportunity.   

Identifying an ideal customer avatar is fundamental to making your app idea live.   

For example – You want to develop android apps for your customers. However, you found out that 80% of your target customers comprise of I-phone users. Thus, you get all the bit-sized information by doing market research.   

3. Do the competitor research   

Michael Corloene once said, “Keep your friends close but your enemies closer.” Doing competitor research plays a significant role because you get to know various things-  

• What type of business model your competitors are following  
• What problems does your app solve  
• Study the competitor market strategy   
• Study the app features   
• Identification of needs in the market   

There are various tools that businesses can use to identify the hot trends going on in the industry. You can take help from multiple sites such as Data.ai, Statista, Business of apps, and google trends. Here, you can identify the demand for apps.   

For Instance – Data.ai provides insights into the number of app downloads and top apps by revenue. Another app, Statista, offers new and relevant information on app usage in various countries.   

Google trends is another tool that businesses can do for conducting market research. It provides you latest data for you to market your app idea. For example – If you want to know which countries have a similar user base for the app you are trying to target, then use this tool wisely.   

4. Create a business plan   

Now, it’s high time for businesses to create a business plan after understanding the target audience, market, and competitors. When you are starting a business plan, a few components have to be included, such as –  

• Create an executive summary   
• Do brainstorming sessions with company stakeholders   
• Analyze your product strengths   
• Frame marketing and sales strategies   
• Estimate the budget   

5. Perform a SWOT analysis   

SWOT analysis lets businesses note their strengths, weaknesses, opportunities available in the market, and external threats that could affect the Business. A SWOT analysis lets you know how your app could be made differently from others.   

Dig deeper to study small and mid-sized companies. You need not worry about imitating competitor strategies blindly; take inspiration from direct and indirect competitors and apply those findings while launching your mobile app.   

For example – If you plan to launch a calorie tracking app, but you performed a SWOT analysis wherein you get to know about competitor apps. You get to know that meal tracker apps are available in the market; now is a good time to analyze the app user interface, UX, and other functionalities.   

Wrapping up  

The above instances might have helped you as to why you need to perform market research for your mobile app idea. 35% startups fail because they develop the product without identifying that there is a market need or not.  

Therefore, it’s better to perform market research for your mobile app idea. If you need help in doing market research for your mobile app idea then connect with our mobile app development experts.  

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