The looming post-apocalyptic future for Apps and AppStores aside, there were still a cornucopia of app launches at SXSW this year. Alan Cooper nailed it when he said that one of the biggest trends he has seen as technology has changed is how the differences in deployment models and computing devices have shifted the strategy and goals of people designing and creating software.
The Killer is Dead, Long Live the Sniper
Once upon a time, everyone had the next "killer app." In the 90s and early 2000s "app" had a different connotation. In that time and context, a killer app was a packaged piece of software with success measured by licenses sold. The biggest success in this model was Microsoft Office. Office competed on an unending number of capabilities. No amount of features was ever enough. With scale and distribution being the critical factors for competition, the barriers to entry were enormous and no serious competitor emerged. It is only now, 20 years later, that the cloud has changed the rules of the game and Google Docs is viewed as possible competition -- though, as of several reports last year, it still struggles to break 10% market share.
With the rise of app stores, distribution and pricing models have changed, paving the way for the next generation of consumer software: Sniper Apps. Sniper Apps are targeted to fill small niches in consumer's lives. Now that design and development costs are so low and distribution costs are only a function of revenue, everyone is taking aim at the consumer with advertising-based business models whether they have surrounding cover or not. I saw so many apps at SXSW, but not one that had a compelling, defensible offering for users, much less a business plan behind it
Attack of the Clones
So are these startups part of a new app bubble or are they a Murderers' Row? Let’s take a look at the apps at the top of the hype heap during SXSW.
Highlight -- Widely regarded as the one with the best shot, Highlight is an app that takes location-based services a little farther, letting you know which people around you share interests and acquaintances with you. You can "highlight" them and also send direct messages to them. It had lots of downloads and a good amount of positive reviews in Apple's AppStore. But does it have the silver bullet necessary for sustained success?
Will users adopt having an app on continuously, sacrificing battery life and giving access to their address book and Facebook data, all for the sake of being able to see who is near them who also likes the Colbert Report? This might get closer to compelling if paired with an additional primary use case like online dating or professional networking. If users could at least focus on those nearby others who share your contacts, it might move into the MVP category of startup product, but the app lacks even the most basic filtering capabilities. The icebreaker concept is kind of unusual, but is it defensible? What can stop Foursquare from modifying its current radar functionality to include friends of friends? I don't know if you've heard, but even foundational patents are worthless without the multiple millions of cash you need in a war chest to defend them.
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What the Truck -- Everywhere I turned in Austin, there were food trucks and signs for the new restaurant deal app (which was a mobile web app and not an AppStore app) with the risque name. To take advantage of this deal, users would have to have access to a QR Code reader (or be willing to type in a cryptic URL), sign in with Facebook, agree to share Facebook information and then give access to their credit card number. All to save $2 on an order of fish tacos! I don't know what planet these guys are living on, but maybe it’s the planet where food trucks are prevalent in more than a few cities, everyone loves QR codes and nobody is aware of rampant data breaches and identity fraud.
Ever since Scoutmob's overwhelming success in Atlanta, everyone and their brother is trying to get in on this space and directly compete with, not only the reasonably well-funded and established Scoutmob, but also known big boys who have subsequently moved in (because nothing is truly defensible anymore) like Foursquare, Yelp, Groupon and Living Social. Some of these latecomers think they have the high ground because they have existing salesforce boots on the ground who already supply financial services that can catch card-based transactions (the aforementioned What the Truck by First Data) or they have both a salesforce combined with POS technology (My Fav Eats by Radiant Systems). What these battle plans fail to account for is: Consumer UX is just not a core competency of these enterprises. Without first-comer status, playing catchup to offerings with already established audiences will be hard without true innovation, especially given that Foursquare's partnership with American Express has obviated the need for POS integration.
Glomper -- This app wins the medal for most hype and most confusion. Its 30-second elevator speech took well over 3 minutes. The core user scenario is that you can see what's happening at local events and hotspots to choose where you want to go based on what other people post who are already there. Outside of the convention-specific use case, I'm not sure I understand where the differentiated offering is here. Given that Foursquare already has the ability to track events within locations (i.e., events at a conference), I would think that the location-based social networking space is way too crowded with not only Foursquare but also Twitter and the only differentiated newcomer in the last year, Path.
Never Get Involved in a Land War in Asia
There were other apps with less-differentiated offerings and even less chance of success than the above. And given the innumerable hordes of startup clones with dollar signs in their eyes, there are more yet to come. The first shots of the new combatants only prove the point made a few weeks ago -- a singular focus on design at the expense of research and strategy is an amphibious assault without air cover (i.e., nothing more than a splashy launch with little hope of sustained success).