I was having a really interesting conversation yesterday, where someone asked me what I thought about Facebook’s potential to survive over the next few years. This question came up because a lot of people in my social circle say they no longer use Facebook the way they used to. Of course, I have no idea what the future holds for Facebook, although my general bet is that owning the online identity of ~1.2 billion people keeps them relatively safe for the time being. I have also found their developing strategy of becoming a publisher for a host of apps like Messenger, Instagram and Paper to be very intriguing because it serves multiple purposes. They get to try new things in apps other than the main Facebook app, so they don’t upset users who dislike change, and they create a virtuous cycle that keeps feeding the social engine of the main platform through new types and forms of interaction.
This got me thinking about Fred Wilson’s post on App Constellations from a couple weeks back. This post discussed how, as the mobile market has matured, we have started to see groups of apps coming from major publishers like Dropbox, Google, Apple, Microsoft, Facebook and others, either as part of consolidation through purchases, like Dropbox’s acquisitions of Mailbox and Loom, as part of an overall publishing strategy, like Google’s suite of apps or a hybrid like Facebook.
The Rich Get Richer
As Fred points out, he believes the idea of App Constellations only works to support and reinforce the rich get richer dynamic in the app stores. That because these major publishers hold all of the users, they can circumvent the discoverability issues in mobile and guide their users to new or existing apps that they want to promote, across apps. This theory supports a very positive outlook for Facebook moving forward because they have, by far, the biggest network of people on their platform, making cross-promotion of internally produced apps, extremely easy.
Startups Must Be Nimble
So what does this mean for the independent or startup app publisher? Well, the important thing to remember is that disruption almost always comes from a small startup that doesn’t suffer from the Innovator’s Dilemma. While there are challenges presented by a mature market, they aren’t insurmountable. It’s a common story among successful startups, that very few of them started with an idea and saw that very same idea through to a successful exit. When you have an idea or an app, your idea or your execution may be 95% wrong or 5% wrong, but it’s definitely wrong in some way.
While we all hope we’re only 5% wrong, the prudent thing to do is stack the odds in your favor. Startups and small publishers have the benefit of being nimble so you should use it to your advantage. In the app world, this means that you should release fast, test with real users and iterate based off of real data. From our experience and seeing the experiences of our users, double-digit lift in key metrics in only a couple of weeks is easily achievable. It’s most likely that your first few iterations won’t see that kind of success, but if you are tracking the data, and learning from the results versus your hypotheses, you will get to successful iterations that can have a dramatic impact on your trajectory.
If you have any thoughts on the topic please share in the comments below. I’d love to hear how you view competing as a startup in the mature app ecosystem, and what your tactics are for going up against the big publishers.