Why Do Startups Create Better Mobile Apps?

Upstart software companies have the odds stacked against them, but every so often, their timing is perfect—even if the product isn’t.

If you’ve been in the tech industry for a while, you occasionally feel history repeating itself. New computing paradigms (like the smartphone, for example) have typically been extinction events for the software leaders on whatever was the formerly dominant platform. The big three app leaders in MS-DOS—Lotus, WordPerfect, and Borland—were all crippled by the transition to Windows. The Windows leaders, in turn, were unable to make themselves dominant in the world of web apps. Now mobile is the new paradigm, and it shouldn’t be a surprise that mobile-first app companies lead most sales categories.

First, the rules of good app design are reset by a new paradigm. Think back to when the web first became prominent. How many websites and web apps looked awful because they were designed to resemble either printed pages or PC screens? Companies took the design practices they already knew and blindly applied them to the new medium. They were quickly outcompeted by people who learned how to design specifically for the web.

Today you see a similar process going on in mobile. Mobile apps and websites designed using PC principles are often over-featured and unengaging to mobile users. The practice of "porting" an app or website to mobile, rather than redesigning it for the new paradigm, usually fails.

The second challenge is that when changing paradigms, users tend to reconsider their software standards. If you buy a new PC, the chances are very good that you’ll buy the same apps for it that you used in your last computer. But when you bought your first smartphone, you didn’t immediately go out and look for mobile versions of your PC apps—if you did, you’re in a small minority. Most people went to the App Store to look around for something new.

This process of exploration means that existing software developers can’t count on customer loyalty—usually one of their greatest strengths—to win in the new paradigm. There's a familiarity and learning effect that makes people stay with the apps they already know if they are on the same platform. Changing platforms forces people to relearn anyway, so it tends to reset those preferences. Existing app makers have to resell their customers, an activity that most big companies are not ready to do.

The third challenge is denial. Most companies facing a platform change underestimate the size of the challenge and the amount of work needed to deal with it. They stick to their old practices and underinvest until it’s too late to recover. If you want to see that process in action, check out Microsoft’s history in mobile computing.

Startups often succeed in a new paradigm because they have none of these disadvantages. They’re not burdened by all the old design assumptions made by an existing company. Because they usually live full time on the new platform, they learn faster. And they can often identify ways to peel off a chunk of customers from an existing software company, before it even knows those customers are at risk. As the old saying goes, it’s like being pecked to death by ducks.

So if you’re running a mobile startup, it’s comforting to know that the forces of nature are on your side. But don’t get too comfortable, because when the next computing paradigm comes along you’ll be the one to be blindsided. Speaking of which, do you really think you can port your smartphone app to tablets and have it succeed? And how will Google Glass and smart watches change your business? The end may be nearer than you think.

Michael Mace is mobile strategist at UserTesting.com. A longtime veteran of Silicon Valley, he cofounded two software startups, worked as an executive at Apple and Palm, and consulted on strategy and product planning to many of the tech industry’s leading firms. He’s a well-known tech industry speaker, with keynotes at the Apple Worldwide Developer Conference, speeches at conferences including CES and CTIA, and appearances on CNN, BBC, and Bloomberg News.

Michael was vice president of product planning and chief competitive officer at Palm, where he worked closely with app developers, network operators, and mobile phone manufacturers to plan for the future of mobile data. At Apple he held a variety of leadership positions, including director of Mac platform marketing, director of marketing for the Home and Education Division, and director of worldwide Customer & Competitive Analysis. He is the author of Map the Future, a book on planning strategy in fast-changing markets.

[Image: Flickr user Kārlis Dambrāns]

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  • Rick Marro

    And you can step this same logic BACKWARDS as well.... There is good reason Railroads are not Prominent in the mobile app world, they didn't adabt to the interstate high way "network" well :-) and the list goes on and on. Great article !! thanks

  • Digital Spring

    Some larger organisations do seem to have some success, by partitioning off the dev teams and giving them the right environments. Its never quite as start-uppy, as it could be as they are encumbered by the stuffiness and suits (often) but some do it well, due to the large cash reserves of larger organisations. I've seen it work well (Skys apps in the Uk are great) and I;ve seen it done badly (Vodafone 7 or 8 years ago tried to start their own in house team and it was a flop). Just allowing your teams to come to work on skate-boards and giving them free soda, does not a good app team make! Culture is the key as always...

  • Reinhard Lanegger

    windows, with its graphical userinterface and Apps as part of the mobile device ecosystem were/are disruptive innovations, which do not correspond to "normal" corporate management and culture. (clayton christenson - disruptive innovation) therefore leader companies like Borland, ms-dos and further microsoft do have trouble in staying in touch with an market that still needs to evolve. That's why the big corporation try to use their captial power within startups that live their product, idea and are not "corporate". 

  • Benjamin Putano

    Interesting article. How does a company, leading the way in a new paradigm, know when to start taking the next potential paradigm shift seriously? Obviously these companies can look back and say they would have jumped into mobile sooner, but how can future companies predict it? 

  • Michael Mace

    Hi, Benjamin.

    You’re asking one of the hardest questions in the tech industry.

    Obviously, if your company has enough money, you should invest in every new platform or paradigm, to make sure you don’t miss one. Samsung does a lot of that (note their new wristwatches), Google does it a fair amount, and Microsoft was a master of it back in the day.

    But most companies don’t have that sort of cash. When you can't do everything, how do you decide where to focus? There are a couple of steps to take:

    1. Make sure someone in your organization learns the new paradigm very well, when it first appears. For example, the time to investigate something like Google Glass is now. Assign somebody smart to work with it and live with it and learn what it can and can’t do. This is a job for an experienced team member who knows your business well, NOT an intern or new hire.

    2. Once that person understands the new paradigm, ask them if it could enable a meaningful change for your customers. At the core of most successful businesses is a particular problem that they solve for a particular type of person. Ask if this new paradigm does, or could, significantly improve the way you solve that problem. If not, does it enable something new in an adjacent area that your customers would love?

    Some carefully conducted user testing can usually help you confirm this information. Don't ask people what they want; show them prototypes or examples of what you might build in the new platform, and see if it turns them on.

    If you answer “yes” or even a strong “maybe” to either of those questions, you probably need to invest more in that paradigm. If you answer no, you should keep monitoring it, but you may be safe for now not to invest.

    Thoroughly answering those questions doesn’t require only user testing. You also need competitive analysis and new technology research. Many tech companies neglect those functions, or don’t manage them for insight. That’s why they get blindsided by change. If you’ll forgive me for a bit of self-promotion, this is a topic I cover in my book Map the Future.


  • Benjamin Putano

    Great pieces of advice, Mike, thank you. I feel like a company just now starting to investigate Glass would even be behind the 8-ball, but I guess it's better late than never. 

  • Michael Mace

     >I feel like a company just now starting to investigate Glass would even be behind the 8-ball

    Yup, no argument here.