Real life experiences with Facebook apps, Amazon associates and iPhone applications?
March 23, 2009 2:39 AM   Subscribe

I have three ideas to make money. One is a real product, one a facebook application, one an iphone application. Am I being realistic?

Hello everyone. I recently found myself with some extra time on my hands (sigh) and decided to use this time to try and start my own business. I know timing is horrible... but need creates the best ideas, doesn't it?

I thought of a real product, which I believe if marketed at the right price would be a hit. Unfortunately this idea needs money for engineering the product and producing a few samples.

Therefore i thought of other two ways to make money with small initial investment (mine and a friend's time) to help me fund the first idea.

1) A facebook application that connects to the associates program. My friend knows how to program a facebook application, I am studying how to better include amazon data in there, this project will be the faster one to bring from start to finish - therefore we will start here.

2) An iPhone application. We still dont know if to sell the application for a small price (2$?) hoping that it flies or to make the application free and generate revenue through another associates program - even though we are not sure people are buying products from their phones yet. The application is simpler than the facebook one, but we have no clue (yet) on iPhone application developing/distributing.

My questions would be a few, but most of all what I would like to ask is real life experiences of somebody who tried (and failed/succeded) making money with facebook, and iphone - to see wheter is worth our time and effort or these are all good ideas on paper but with no real life payoff.

I realize mileages might vary and it really depends on the ideas and how well they are executed - but a few stories by somebody else can maybe help us size our idea and lead us to better decisions!

thanks to everybody!
posted by madeinitaly to Work & Money (7 answers total) 1 user marked this as a favorite
Sounds like you already know the answer, but here's my take on it:

The real product will likely take the most time, effort, and money to make. If you think it is worth it, patent/copyright/trademark or otherwise protect it (see Nolo Press books for more info), and sell or license it. If you really want to own it and make it yourself, wait until you can develop it fully on your own with your own business.

The iPhone app will require, minimum, $99 ADC membership, a Mac to run Xcode, and an iPhone or iPod touch to test on (though you can get away with using Simulator). If you need to make a quick buck, this may or may not be the best route for you, depending on your comfort and familiarity with Obj-C.

The Facebook/Amazon thing may cost you nothing to develop but time if you do all the work yourself or share it with somebody in the same situation as you. If it takes the least time and effort, start there.

If you really need to start making money *now* pick the one you feel the most sure about, both in the product and in your ability to fully develop it.
posted by bigtex at 2:59 AM on March 23, 2009

Just a note. I tried making a facebook app a year ago, and the constant changes to the platform were maddening. It didn't help that I was new to web apps, but the problems definitely weren't always on my end. At the time, the forums were filled with offers for sale of apps that had gained only user base, through mass spamming of invites. I walked away with the impression that facebook was causing instability with the sole purpose of forcing out of the market all hobby developers (almost understandable, because of all the lame quiz apps at the time).

Be prepared to support the interface daily unless things have changed. Users are not as forgiving as they used to be (and apps are not as prominent). At least subscribe to the developers news feed. Oh, also there's the push towards Connect, ie having a complete other site which simply uses fb as its authentication.
posted by gensubuser at 3:29 AM on March 23, 2009

You'll need to do a lot more market research for all your ideas.

I am not intending to be mean with this comment, but realistic.

Regarding your Facebook Amazon app: what exactly would it do that doesn't already exist in some form? Almost everyone tries to make money via the Amazon referral code, if that's what you mean to use. You've listed a way to make a small amount of money, but nothing to draw the customers to using your app.

iPhone applications are tough. There were some recent analytics about revenue rate and usage of apps. Basically it's hard to sell your app unless you're on the Top 25-100 pages, people will only use the app for a few days after they get it even if it's paid or free. One big point is that the free ad-supported business model does not work at all, you would need to serve a screenful of ads with no content to gain revenue theoretically. The only way a free model works is if it's a Lite version, and even then I'm not sure what the turnaround is for people who pay the full price, but it's likely not very high.

Associate programs require a huge amount of traffic to make money, and your post does not say what this big item is that will draw the traffic to you. This is the kicker. You need to think up the next big application that everyone wants to use and would be willing to pay money for in the case of iPhone. Sadly, everyone is trying to do this now.

Either way, it will be much harder now than it was a few years ago to make money via these methods. Sorry my comment wasn't too motivating, but that's just the way business is nowadays.
posted by Meagan at 6:04 AM on March 23, 2009

Just in case you were thinking about doing the Amazon affiliate thing with the iPhone, think again. Amazon explicitly excludes "mobile use" from the affiliate agreement, and at least one iPhone app has been cut off from Amazon because the developers hadn't arranged an additional license (and their app didn't look like it'd suck).

Writing iPhone apps is, indeed, a bit of a challenge. I'm currently waiting on my first app to go through its second round of review (I got a rejection for a HIG violation after my first submission).
posted by lowlife at 7:40 AM on March 23, 2009

Any of those sounds like a really great thing to do with your unexpected, um "free time." Your worst outcome is a (small, I hope) financial loss and a whole lot of experience in how to do this stuff. Plus, what a fabulous way to test a friendship! (kidding)

You need to make a business plan for each option, even a rudimentary one will help. This would include the above mentioned market research-- do people need this product, and how will you tell them about it; finances-- a realistic assessment of cash outlay, your resources including loans, current cash and/or investors as well as how much loss you think you can absorb (very important-- don't mortgage the farm if you don't have someplace else to live); a calendar-- how much time to develop, roll out, beta, roll out again, as well as how long you think your free time will last. Can you do this project if you or your partner also have other time obligations?

You need a mission. WHAT the product is WHY it's needed by WHOM (For xx type of people MY PRODUCT is the yy that does zz) Sounds trite, but why exactly are you presenting this project? "It's a cool idea" and "I have some free time" are not sufficient reasons to start a money making proposition. That's a hobby, not a business. (Although, doing this as a hobby should not be off the table, as it could reduce emotional and resources stress while still giving you the experience).

Hugely over simplified. There are lots of good business plan apps and websites. Good luck, have fun, and post it to MeFi Projects!
posted by nax at 7:55 AM on March 23, 2009 [1 favorite]

Response by poster: Dear all, thanks for your replies so far. No worries about being mean - honest answers are the best i can get. and so far i agree with all that has been said.

I used to be (sigh, again) product manager for one of the 50 biggest brands and I am familiar with market researches before launching a (physical) product. I really believe both these 3 ideas have good potential.

1) the product potentially exists, but only 1 company worldwide and for approx 5 times the price i believe this item can be sold at (by skipping the nice to have and keeping only the bare minimums). problem is i really need some serious engineering going on here - therefore money.

2) the facebook app and iphone app are not there. i have looked for them and did not find. the one for facebook is really surprising it's not there yet and i strongly believe that it would be a model that incentivates the buying through the link. still i dont know how easy/uneasy it is to spread the application around in the beginning. a couple of years ago people would just accept any application invitations, now they reject all, that's my feeling - your experiences welcome.

I agree a business plan is what i need to do, and that is one of the reasons why i posted this question is that... apparently it is impossible to realistically size the market of an associate program or an application! You only find news on how that college student created a little application and got bought for millions of $ or bloggers who tell you they quit their day jobs and now sell ebooks on how they did it...

i am in the need for real life experiences and - for how delicate this can be - some financial outlines. i have no way to make a business plan with no real reference. this is where i hoped my mefites will come in strong !

again, thank you all

ps, as a reserve strategy I am heavy on buying lottery tickets lately...
posted by madeinitaly at 8:36 AM on March 23, 2009

Nothing wrong with thinking things through and coming up with a business plan, as people are suggesting here, but thinking things through has its own costs in terms of time and money, and the information you have to work with is often imperfect.

So, I'd suggest thinking seriously about how much effort it will take to create your Facebook and iPhone apps, spend a little time figuring out what it will take in terms of customers/traffic to make that effort worthwhile, and then whether you have have any good ideas for reaching that point. If at all seems reasonable, don't waste any time and get started. The sooner you are engaging, or trying to engage, with real customers, the greater your chances are of hitting on a winning product.
posted by Good Brain at 9:07 AM on March 23, 2009

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