March 28, 2016 6:49 PM

How to Disrupt an Industry

Consumers spend 85% of their time on smartphones. It’s a billion dollar business that’s no longer easy to penetrate. However, the opportunities are still there – the difficulty is finding the right niche to disrupt an industry.

Let’s take social media, for example. Most people think that Facebook will always be the top dog, but look at the market value for newer apps such as Pinterest, Snapchat and Instagram. Each of them have a slightly different angle than Facebook, and these app owners have been able to carve out a slice of the social media app pie. Instagram is now worth $35 billion, Pinterest is worth $11 billion, and Snapchat is worth $19 billion. Each of these apps has a relatively recent beginning, but they were still able to wedge into an already Facebook-centric society.

Idea makers might find the app ecosystem intimidating, but it’s still an open market for people who know how to disrupt the current environment. Four methods are used to create a platform that gains user attention: intermediate the industry, dis-intermediate the industry, gamification and niche an existing idea.

Intermediate the Industry

Several app creators have found their niche by wedging between a buyer and a seller. Take GrubHub as an example. This company is not a seller or buyer. They exist to bridge the gap between restaurants (sellers) and hungry patrons (buyers). They connect the two together and take an average 13.5% commission from each order. Buyers aren’t charged a penny, and they get to rate their favorite restaurant. The app boosts sales for sellers, and it’s become a central place for buyers to find restaurant.

This service provides an intermediate within the industry that buyers and sellers rely on. Both buyers and sellers see the app as a necessary part of restaurant dining even though the system is an extra step from making a simple phone call to a restaurant.

Dis-Intermediation the Industry

Opposite from intermediation, dis-intermediation is the process of cutting out the middle man. The best example of dis-intermediation is eBay. Although eBay has been in business for years, the company took advantage of the market when buyers and sellers had nowhere to connect unless they went through official buying and selling channels. Sellers had to find a store that would stock their products, and buyers had to find a store that sold their favorite product.

Ebay cut out brick-and-mortar stores and gave both buyers and sellers a place to sell and shop products. Still today, it’s one of the biggest online marketplaces. Millions of sellers rely on eBay’s virtual storefront to sell product to millions of shoppers, taking out much of the merchant overhead and giving buyers millions of products to choose from.

Gamification

Everyone likes some type of game, and gamification is one way new app creators can find an addictive edge in the market. We mentioned that people spend 85% of their time on smartphones, and 43% of that time is playing smart device games.

App games are the hottest area in the market, but even non-gaming platforms can engage users with prizes – even virtual ones – to gain more user interest. For instance, the diet industry is filled with gamification incentives. Take Fitbit as an example. Fitbit uses the Matchup app to challenge each of its users. Users keep track of goals and compare their fitness achievements with other users. The “Fitbit Challenge” made the device go viral.

Niche an Existing Idea

Some app owners find success by completely revolutionizing the industry and making their own niche. Every niche has a beginning, and some of the biggest brands were from creators who just “do it better.” Google took over Altavista, Facebook replaced MySpace, and Apple and Android overtook the dominant Blackberry market.

All of these companies have something in common – they created their own niche independent of any other companies. A good example of a more current app is Pinterest. Pinterest isn’t the same as Facebook. It has some unique characteristics that gave it a place in social media.

Facebook is a place to connect with friends, share your interests and they can reciprocate. Pinterest has a similar connection in that it connects you with friends, but it’s just for sharing images and links. It’s not a “social” platform, but rather it’s a sharing platform. Its unique characteristic is that it focuses on photo sharing rather than status updates.

Creating your own niche is one of the most difficult yet rewarding of all four of these methods, but it’s also much more difficult. Marketing is key to winning a niche war.

Chances are that one of these four methods matches your app idea. You just need to figure out your own angle, mold a few marketing techniques, and listen to user feedback to continually tweak your ideas. It’s not impossible to shake up the market and find your own slice of the pie, but it does take hard work, dedication, and possible a little luck.