The Data Behind Why Apps Fail


What does it take to create a successful app? The data shows that it might be more difficult than most would anticipate. While apps are used more today than ever, they aren’t downloaded quite as often. This means that a select few apps are dominating the overwhelming majority of user attention share. It is critical now more than ever that app developers solve real problems with their products and perform real research before writing any code.

The average smartphone user downloads zero apps per month. I’m not kidding. According to comScore, only about one third of smartphone users download any apps in an average month, with the bulk of those users downloading only 1-3 apps. A very small fraction of users will go on to download 4 or more apps per month. Beyond that, the top 7% of smartphone owners account for nearly half of all download activity in a given month, meaning that a very active minority are responsible for a large portion of all app downloads.

Why Aren’t People Downloading Apps?

That’s a good question. Truthfully, this data actually seems kind of counter-intuitive at first glance. The app market has grown exponentially over the course of the last couple years, with apps now representing 52% of the time that people spend with digital media. That’s up 40% from 2013. In fact, 7 out of every 8 minutes of media consumption on mobile devices is spent via apps. US users on average have twice as many apps today as they did in 2013, with an average of 42 apps on smartphones and 35 on tablets. Seems like apps are all the rage, right?

Actually, as we begin to dig deeper into the data behind app consumption, we start to find that the app market isn’t quite what it seems to be. In it’s current state, the marketplace is rather saturated with apps for just about every possible function. Yet at the same time, users are indicating that they just don’t want that many apps, especially if they don’t solve an explicit problem. Another issue that’s been raised is that Apple’s app store doesn’t allow for much discoverability, causing many frustrated users to ditch the sub-par search functionalities and resort to downloading from “top 25” lists instead. But perhaps most shockingly, we’re finding that the overwhelming amount of app usage time is actually being spent on a very select number of apps. So people are using apps, but they aren’t downloading them. And the list of apps that they are using is short.

200 Apps Dominate the Entire Market

According to Nielsen, 70% of total US smartphone app usage is accounted for by the top 200 apps in the marketplace. We especially saw this in one of comScore’s follow-up studies, where they looked at the top 25 mobile apps in America (by unique visitors). Facebook was by far the top app, with 115.4 million unique monthly visitors. Being that there were 160 million total app users in the US at the time of the study, that’s an impressive 72% penetration rate. For context, Facebook had around 1.1 billion mobile users worldwide at the time. We also found that Google was the top publisher, occupying spaces 2, 3, 4, 6, 7, and 16.

It’s also important to note that there were no games in the top 25%, despite the fact that 59% of apps downloaded are games, compared to 21% for communication, 9% for entertainment, and 6% for mobile commerce. This is likely due to the fact that games tend to spike in popularity and then decline, while apps from publishers like Facebook and Google are more here to stay.

The App Store Is Oversaturated with Unoriginality

So naturally, we’re starting to see a lot of misguided spinoffs of these top 200 ultra successful apps. Uber is an excellent example of this. So excellent, in fact, that Product Hunt has actually created an “Uber of X” list with dozens of Uber derivatives that have been submitted to their site. There is an Uber for Alcohol (called Minibar), an Uber for Security (called Bannerman), an Uber for Dog Walkers (called Wag!), an Uber for Pizza (called Push for Pizza), an Uber for Doctors (called Heal), an Uber for Massages (called Unwind Me), an Uber for Haircuts (called Short Cut), an Uber for Private Investigators (called Trustify), and even an Uber for Uber (called Mowares) – where you can create your own Uber app. These apps are all based off of concepts that have literally been on the covers of the world’s most high impact publications for years.

I’m going to let you all in on a secret: if the unique and innovative fundamental aspects of somebody’s idea for a new app have already been at the top of the iTunes “top 25 apps” list or on the front page of Wired Magazine, their idea is no longer unique nor innovative. Companies like Uber and Airbnb both had a strong value proposition that was accompanied by a unique style of execution, where they leveraged the app medium to create the now famous “taxi company with no taxis” and “hotel company with no hotels.” You’ve all seen that quote, right?

Uber, the world’s largest taxi company, owns no vehicles. Facebook, the world’s most popular media owner, creates no content. Alibaba, the world’s most valuable retailer, has no inventory. And Airbnb, the world’s largest accommodation provider, owns no real estate. Something interesting is happening.

This concept of “x with no y” or, in it’s most simple form, “basically no overhead” was unique back in 2008 and 2009 when Uber and Airbnb were getting started and nobody had ever done anything like this before. But it isn’t any more, and both VCs and consumers alike are aware of that. So this means that if you’re going to create an Uber of X, you’re going to be relying almost exclusively on the strength of your value proposition, because your method of execution has already been played out and thus is inherently trite. This, more than anything, reiterates the need for strong, thorough, and unbiased concept verification. And yet, we’re still seeing this issue of “more apps, less demand” start to proliferate even more. Why is that?

Wantrepreneurs Don’t Know Their Users

Unsurprisingly, in a recent massive survey of app store developers and entrepreneurs, the majority of developers reported that app development was not financially rewarding. Out of the vast majority of developers that created apps to make money, 67% were not making enough to sustain them or their business and were thus below the “app poverty line.” But perhaps more importantly, it was found that most developers weren’t making money when they were creating apps that they personally wanted. 49% of developers reported that they developed apps based solely on their own needs. Those same developers ended up generating the least amount of revenue.

But even when developers are able to get users to download their apps, we’re still seeing that on average, only 1 in 4 users keep an app. This points to two major issues in the UX and Growth strategies that many apps are employing today, where they’re not properly identifying a viable need for their product before they develop it, and when they do develop it, they’re not researching how users would expect it to function. Instead, they’re just creating what they personally like or what they think others would like, in total absence of any real data. And it just isn’t working.

Solve a Problem and Solve It Well

I think this lends itself to the need for a radical shift in the way that we think about not only app development, but business development as a whole. No matter how great of an idea we have, we should first verify that there is a demand for our idea. We can do this by studying the problem that our idea intends to solve. This inverts the process on itself, where instead of focusing first on the solution that we came up with, we begin by focusing on the problem and extrapolating a solution from there. In some cases where we start with a solution (instead of a problem), we may find out several months down the road that our solution actually doesn’t solve any real problems (and thus doesn’t have any consumer demand tied to it). By falling in love with problems, rather than solutions, we’re able to take a more calculated approach to concept development.

Rather than start by asking “how do we build this?” we should instead start by asking “should we build this?” Through this approach, we can ensure that our efforts will be met with legitimate consumer demand. Now, this may sound like a bit of an intimidating or foreign way of thinking about things, but if we look back far enough, a lot of us were actually doing this exact thing in preparation for our middle school science fairs. Remember the scientific method? That employs a lot of the same basic philosophy that this system of concept validation uses. Best of all, it’s really easy to run verification experiments like this. In fact, I ran a couple light experiments on this article while I was writing it. I conducted a qualitative test where I asked a group of UX Designers what they thought of my proposed titles and content, and I ran a quantitative test where I surveyed 50 random people on different options for the title of the article. This helped me to make more well-informed decisions surrounding how I structured my content. And it took very little effort to pull it all together.

Through concept verification, we can ensure that our app is something that users would be likely to download. But to retain those users, we need to follow through by creating an in-app experience that people want and enjoy. This is the second critical element of the process and it requires that we introduce user research at the very earliest stages of the project. This will help us to create a product that is centered around the user, solving a real problem and delivering on it’s promises.

Once the first version is released, we can immediately begin collecting data and more user feedback that can be leveraged in future iterations of the product and design. But to create an app that actually makes it’s way onto users’ phones and stays there, elevating us above the “app poverty line,” we need to create something that users actually want and then deliver an experience that keeps them using it. Do that and you’ll be miles ahead of the thousands of app developers that design in the dark and release, only to be puzzled by mediocre results.

I discuss this more on the UX & Growth Podcast