The Consumer Internet Sweet Spot

As a rabid fan of consumer internet, I try a lot of new apps and products. Of late, I’ve noticed that very few, if any, of these new startups are “sticking” for me. Coincidentally, Hunter Walk recently wrote a post in which he cited “app promiscuity” — that our constant craving for something new leads us to move on to the latest and greatest app before even giving the first one a real chance. Additionally, Brian Norgard Tweeted that apps need to naturally fit into users’ mobile flow to have any chance at success.

So, I’ve been trying to reconcile Hunter’s hypothesis and Brian’s Tweet with my own thoughts on the consumer apps and products that have resonated with me in the past — those that have made it into my flow, mobile or otherwise. In doing so, I’ve boiled down the likelihood of a consumer internet product having immediate and long-term success to the following: it must simultaneously be a diversion (i.e. a way to pass time waiting in line) and a utility. This formula, of course, doesn’t guarantee success, but it’s a good start.

Apps that are purely diversions (i.e. games) are often flashes in the pan. Hunter references Dots, and I’d throw QuizUp and the recently (officially) shuttered into the conversation as well. While Hunter thinks our obsession with new things is what’s driving our app exhaustion, I’d suggest it’s because these products serve no other purpose besides providing users amusement. All three of the above took off quickly, generating tons of buzz and downloads, but I (and many others) burned out on those products just as quickly as they ascended in popularity. Building apps that are purely diversions is a great way to generate instant interest, but it’s tough to make it last. This is one of the core reasons why gaming companies need to continue to consistently crank out hit after hit, and even the best ones find that this is hardly sustainable.

On the opposite end of the spectrum, products that are purely utilities must be so incredibly useful and superior to the alternatives that they build up high switching costs, usually because of significant network effects. In this instance, think Google (search), LinkedIn, WhatsApp, Uber, or Dropbox. On the horizon, I think startups like IFTTT, Circa, Quip, or Pocket could be utilities that become large, compelling companies. Other apps and products that are pure utilities but aren’t several orders of magnitude better than their competitors may be able to build a business, but it’s unlikely that they’ll be able to create something truly transformative.

Ultimately, the apps and products that are most likely to have success, both in the near- and long-term, are that are both fun to use and provide significant utility. It’s a difficult balance to strike, but Twitter, Pinterest, Wanelo, Foursquare, Snapchat, YouTube, Instagram, Spotify, Vine, and Tumblr are several examples of consumer internet products that can serve as a diversion / are enjoyable to use but also have a clear utility. Facebook certainly began this way, and even email (remember the novelty and excitement of “You’ve got mail?”). However, over time, the “fun factor” of each, particularly email, has degraded. Email has devolved to a pure utility, which potentially makes it vulnerable to a vastly superior substitute. Meanwhile, for some people, Facebook as a diversion is waning, but it still is a phenomenal tool, and it seems like it will be a while before anything usurps it. A product gets into trouble when the utility degrades, and all that remains is the diversion aspect, something that I fear could happen eventually with Vine and Instagram.

So, given this thesis around diversion and utility, which startups do I think have the best chances for long-term success? Jelly and Secret. Jelly has obvious utility, but it also is incredibly fun to peruse and chime in on relevant questions. The required photo and other UI elements certainly contribute to this sense of amusement. Meanwhile, Secret is more clearly a diversion (or perhaps, guilty pleasure), and if some of the negative content gets more contained, the enjoyment of using the app should increase even more. It’s also been fascinating to see people use the app as a psychological tool for sharing feelings and receiving support in comments. It’s definitely early days for both apps, but based on my hypothesis about diversion and utility, Jelly and Secret seem to be the apps that have best combined these two broad use cases recently.