iPhone App Development – A Case Study
In the spirit of open information, I want to catalog the entire process from inception to revenue models. I hope this serves as a way to understand the process more fully and inspire others to do the same. This will be broken out into a few different posts, as the process will be a 2-3 month endeavor.
I also recommend you checkout Bluecloud's full Mobile App Development Guide. It's free and a great tool for developing apps.
Making an iPhone App – Where Do I Start?
A little back history – I've developed a few iPhone apps for fun with a local developer that were just messing around. They were very simple and had a static background that cycled information and quotes in a random fashion, all pulled from an XML file. My role was content and design, both of which did not involve much depth. It was a great experience though, having gone through the process from start to finish and to understand exactly what it takes to get an app rocking and rolling. Most importantly, I was able to work with a developer every step of the way and understand why certain projects fail and why some succeed, analyzed through the lens of personality differentials (which, I would say, accounts for at least 50% of the timeline problems in business).
Earlier this year I took the app development projects to the next level by hiring a developer to build a basic, mutli-tab app that supported a website I had built. I provided all the design and content again, and answered every email within an hour. The app went from scope to uploaded to iTunes in under a week. Instead of pitching the idea and asking for a price, I outlined everything I hoped the app could do (very simple functionality) and asked what on that list could be done for under $500. This made the deliverables very clear and we both left happy.
Just as the internet did, the app market is beginning to cater to people that see the potential. There are thousands of people looking for a way to get started (especially on the cheap) without any programming, design, or marketing experience. Checkout this post to read more about How to Build an iPhone App Without Hiring a Developer.
Now, this latest app is going to be a more direct business venture. I am teaming up with two guys who each bring something unique to the table – one is a veteran in the bartending and restaurant world, owning an enormous digital library of content, the other is a savvy businessman who works high up at a beverage distribution company. The app idea came when we were sitting down and talking about how many of these liquor companies (Bicardi, Brown Forman, etc) have modified their marketing budgets from previously allocating 10% to digital/mobile/social to (ahem) 60% in 2012. These are $90M budgets. And they literally have no idea how to spend it.
Types of iPhone Apps
Mobile apps come in many different shapes and colors – informational, useful, fun – there's something for everyone. It seems like every company now wants a company app of some sort, and most can take care of that themselves (especially huge companies). The exciting part, however, is creating a game that engages users which companies can piggy back. Imagine if Angry Birds offered corporate sponsorship for their game? You could have a Disney World level, for example.
If you're interested in learning more about how to build your app and know the list of different ways you can get into the app store, you may enjoy this post 5 Options For Building Your App Empire.
This, in my opinion, is the opportunity in the market, because it essentially creates a new market. Creating a game with a full focus an intention to promote a brand is a win-win. It costs the companies nothing, they get to put their name in the game, and all they have to do is market it (which most will do happily).
I had this realization about a year ago and have done it for lead acquisition type projects, but nothing this directly proprietary and on this level. And so we all came to the conclusion that we should build an app that the liquor companies would love. The best part is that we knew exactly what they wanted because our team member talks to their marketing team on a weekly basis and has asked them specifically!
So, I began the research.
Addictive Gaming Logic Makes Money. Big Money.
To me, the idea of the game is secondary to the psychology of it. What I mean by this is that the “how it works” is what separates games from being a $20K revenue driver and a $200K revenue driver. Figuring out why certain games are harder to put down than others is the #1 mystery to break before diving into any game project. I downloaded hundreds of games, played them, and took copious notes on which were most addictive on a scale of 1 to 10. I took into account average time I played them, my interest level, and how many times I would play it in a week. I also took into account how willing I was to recommend it to a friend, a metric I believe is the ultimate measure of “growth index” in the web world.
I then took the top 10 games and created a list of their features and game architecture. I noted what I liked about each, along with how the designs worked well with the specific functionality. Then, I compared everything in Excel and saw three characteristics that were consistent in all the addictive games. They were:
• The dichotomy of time. Levels do not take very long, but there are lots of them. This was most influential when I looked at the “how often do I come back to this game” metric.
• Easy to be pretty good, hard to be great. Angry Birds is a great example of this (I reference that game since everyone knows it). It's easy to knock down 85% of the structures, but very hard to get 100%. That 15% is where the addiction comes in.
• Slow Movements are More Addictive. What I mean by this is that the speed at which the object in question moves is very important to invoking the feeling of wanting to do it again. In other words, if the birds in Angry Birds moved faster through the air, the game would be less addictive. Having to wait to go again, even half a second longer, can make all the difference.
Cashing in on an Addictive Game
There is another form of gaming addiction that I also looked at – how to upsell within the game. The absolute best example of this was in a game called Infinity Blade, an RPG game about defeating your enemies using different tools, etc. You collect money from these defeats, along with finding money in the game. Then you cash in your money for better equipment that allows you to kill bigger enemies, make more money, buy better gear. The cycle continues.
This is exactly what I was looking for. Instead of integrating the equipment into the game (i.e. finding a new shield on the ground), the game designers created a market within the game which put the user one step away from what they want. The beauty of this is that the gamer can peruse everything he or she COULD have, but they don't have the money to buy the best sword or armor or whatever. You have to play the game for weeks if you want to amass the funds needed for some of the top equipment.
Unless…..you buy currency in the iTunes store.
You can actually purchase currency for the game through iTunes – $0.99 gets you 20,000 game dollars, $4.99 gets you 150,000 etc all the way up to spending $30 of real money to buy this game money, which is then turned into better equipment. This is what you see in Second Life and Farmville, and anyone who knows about those companies knows how much money they make on their apps.
This was the ultimate breakthrough for me and my research. I now understood exactly what needed to happen in the game play to make people engage, along with the psychology of how to turn that addiction factor in real money. Beautiful.
The next post will discuss the game itself and how it works, the costs involved, and how to present this entire package to a developer in a way that will work. Checkout this post iPhone App Developement – Part II to read more.