How To Build Your Own App Store

OpenCHannel App Store

It’s not easy to build your own app store but it has become one of the greatest product strategies out there. There’s nothing new about the app store, Apple (the most famous App Store operator) has been playing this game for more than ten years. In the past five years, an app store has become an unbeatable competative advantage for many product technologies like SaaS, wearable tech and IoT.

Creating Your Proof-Of-Concept App Store

Ideally, you’ll have some general concept about how your apps will work and quickly setup a proof of concept to rally your team. For this I recommend using OpenChannel. It’s free and there’s sample code that you can use to stand up your POC app store in just a few minutes. If you’re looking to create a formal set of app store requirements there is a Requirements Generator to help you get started with your new app store.

Components of an App Store

The details of each app store will vary slightly based on your unique requirements but the components themselves are generally the same. The main components of an app store are: A developer portal, a marketplace and a management dashboard.

Developer Portal

A developer portal (or partner portal) is where developers can sign up, receive support and manage the apps submitted to your app store. Generally, this developer portal will either be a stand-alone website or built into your product or service. Some of the sub components of a developer portal may include:

  • Developer registration and login
  • A section where developers can submit, update and manage their apps
  • Statistics to let developers know how well their app is performing (number of views, downloads, conversions, etc…)
  • Developer support documentation or guidelines for building apps
  • Any legal agreements such as marketplace agreement or developer distribution agreement that will need to be presented to the developer

Marketplace

A marketplace is where users can search, browse, buy or install apps. I recommend that you build your marketplace experience into your product or anywhere that is highly visible to your users. The more integrated it is and accessible the marketplace – the better. Some of the sub components of a marketplace may include:

  • Categories and a search bar where users can browse and discover apps
  • A on-click call to action that let’s a user install or buy apps
  • An area where users can view and manage their installed apps

Management Dashboard

A management dashboard is where you (the marketplace administrator) can moderate, approve and update the apps submitted to your app store. It’s also important to manage communication with your developers. It’s not unusual for an app to not live up to your standards. This means that there might need to be some back and forth between you and the developer in order to resolve the issues. Some of the sub components of a management dashboard may include:

  • Marketplace administrator login
  • An area where you can view, moderate, approve or reject the apps submitted to your marketplace
  • Statistics to let you know how well your app store is performing (number of views, downloads, conversions, etc…)
  • A method for communicating (and organizing conversations) with developers

Why Build Your Own App Store?

The App Store strategy is an amazing advantage for any technological product because it’s benefits are fundamentally simple and universal.

At the end of the day, an app store turns a product into a platform. This transformation has been the single most successful growth strategy for industries like SaaS, IoT, Wearables, IaaS and PaaS to name a few. In recent years, leaders have started speeding to build up their developer communities. Just recently, Slack, a real-time messaging app announced that it’s launching an $80 million dollar fund for companies that build apps for the Slack app directory.

“Platform beats a product every time”
–Wolfram Jost (Software AG CTO)

Attract more users by solving more use cases

Tech companies start out by focusing on solving a single, large problem better than anyone else. However, these advantages are short lived and you’ll need to innovate faster than the competition in order to grow.

Let’s take a look at the Drone industry when it first became popular. Consumer drone companies captured significant amounts of value and profited from the huge initial demand of thier hardware. This made sense because, at the time, the industry was sexy, new and lacked competitive pressure.

But what happens in a mature industry with a ton of competition and goliaths with over 80% market share? How do you grow from being a nieche player to an industry leader? How do you solidify your position in the market? That’s when you’ll need to start becoming a platform.

“The only way to make a profit in the Internet of Things is to build a network of entrepreneurs who create unique value on top of commodity hardware, connectivity and cloud services.”
— Vision Mobile

Why does anyone choose WordPress to power their website? Is the performance really good? No, it uses PHP and is currently the slowest mainstream CMS. Is it easy to use? No, there are several that are much simpler like Light, Surreal and Bolt. Is WordPress better than the competition in any appreciable way? No. So how is it that WordPress powers 20% of the web and is still gaining market share? Simple, because it has over 40,000 plugins developed by a community that was, at first, looking to solve their own problems. People don’t want WordPress because it’s a good product – it’s not. People want the WordPress because the plugins solve their specific needs. Want a website with a Forum, Social Network, Photo Gallery and Scheduling System? Easy, just use WordPress.

Reduce churn by increasing user engagement

Losing customers always hurts. Even an annual churn rate as low as 1% could cost millions of dollars of lost revenue. Fortunately, people much smarter than myself have found that a user’s engagement is an excellent predictor of churn. Apps provide vital new experiences for hardware products like VR headsets, fitness trackers or dronesthat ultimately help keep the product from ending up in a drawer.

Apps, plugins and extensions help reduce churn by increasing your product’s usefulness and giving users more reasons to be engaged. Let’s take Facebook for instance, Facebook apps account for nearly one third of user engagement. One third! Who’s down for playing some Candy Crush?

In addition, not only does an App Store help reduce churn, it can even create negative churn. This is a phenomenon where existing users are increasing their spend faster than the churn rate. Negative churn can be achieved by up-selling users to higher cost service plans or cross-selling additional services (like apps).

How Hard Could It Be?

It’s not all sunshine and unicorns. After all, successful app ecosystems take effort to build and require time, money and expertise. It’s also not just a technical challenge. It’s a strategy that involves every department – legal, marketing, technology and support.

Fortunately, there are services like OpenChannel’s App Store API that provide the technology aimed at reducing the time and cost of building your own app store.

In Short…

In the end, building your own app store makes your product better by helping you crowdsource innovation. It’s an extremely rewarding strategy that can make you an industry leader. However, it’s not an easy road and there are challenges to overcome.

“When looking to build a sustainable open source, SaaS, or other type of business, the trick is to spend as much time building one’s community as one spends on the product itself. Because that community — that ecosystem — is ultimately the thing that makes a product so valuable to prospective customers and makes them willing to pay a premium.” –Matt Asay (Adobe)
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