We at Syndicode have recently spotted that on-demand apps were taking lists of software development trends for 2020.
The discussion obviously started much earlier, with the popularity of Uber and Airbnb. Still, it took some time to realize that the success of these startups isn’t a particular case, but depends on their business model – an on-demand app.
Considering the rising demand for on-demand app development, it’s impossible not to mention Uber or Airbnb. The success of Uber and Airbnb was replicated in many other industries by using a similar model.
We have similar startups for food delivery, fitness, beauty – whatever you name. However, not all niches and ideas are taken – every year, we see new on-demand startups that prove the rule.
What is an on-demand app
An on-demand service is a website or mobile app where users can order a service or product exactly when they need it.
The actual situation on the market shows that such products are usually service-oriented: clients are connected to professionals who can help immediately. Also, it’s okay to call it a marketplace, because people are selling and buying services.
Why are on-demand apps so popular?
By popular, we mean 22.4 million users each year with $56.7 billion of revenue – that’s how much the on-demand economy is worth now. Keep in mind that it’s a young industry – people only really started talking about on-demand apps after Airbnb and Uber. Now, on-demand apps connect customers to contractors, customers to companies, and companies to companies, which is why this model is highly universal.
The beauty of on-demand apps is that they can be adapted to all kinds of businesses – C2C, B2B, B2C.
Business owners like on-demand app services because they are trendy, easy-to-build, comfortable to manage, and don’t require much budget.
- Flexibility: an on-demand app relies on community-executed services. The company itself doesn’t have to take responsibility for owning or guaranteeing anything (food company with no food, taxi provider with no cars, etc.).
- Trends: on-demand apps attract investors and partners because they are popular. Selling such a concept is easy because that’s what everybody is looking for now.
- Cost-efficiency: you don’t need to buy any products or employ people who will provide services. All you need is a software development team that will build the marketplace and budget for marketing activities that will get your platform to users.
- Quick to execute: on-demand apps are developed in several months. In 30-60 days from now, you can have a running business from scratch.
It wouldn’t matter how convenient an on-demand app platform is for startup owners if clients weren’t interested. Luckily, they are – and here’s why.
- Convenience: users don’t like signing up for something that requires commitment – and on-demand apps respond to that mindset. Often, such solutions offer free trials to get customers to make the first order and appreciate the convenience of the service. This is why users are easily convinced.
- Customer-centered: most on-demand apps operate on the to-your-doorstep basis. The app will remember the client’s location and send a provider there. It also remembers personal preferences, allows rating service quality, and reviewing providers. Users have the decisive power – and they like it.
- Community: users like the idea of getting access to million users instead of just contacting one contractor. On-demand apps grant freedom of choice by offering access to a professional community.
The success of on-demand apps is in their feasibility and flexibility. Both for business owners and users, it costs very little to get started, and the payoff is evident early on.
How to build an on-demand app
All successful on-demand products were built on promising business models. They don’t have to be innovative – the idea of a taxi app or delivery on-demand app surely isn’t novel – but Uber and GrubEats made it work. The combination of a relevant concept and thought-out execution makes an on-demand marketplace successful.
Step 1 – Choose a niche
VC investors often say not to start your pitch with claims of developing an Uber for (name of the niche). They explain that Uber already exists, and you are expected to come up with a new vision.
Don’t start your research with an existing on-demand app in mind.
If you are looking for a niche that can be “uberized”, you will limit yourself from good options. Rely on personal experience first and back up your ideas with statistics. Analyze the issues you face every day that doesn’t have a comfortable solution yet.
The most common types of on-demand apps
- Transportation: Uber, Lift, BlaBlaCar
- Delivery: UberEats, DoorDash, GrubEats
- Fashion and beauty: Treatwell, LeSalon
- Healthcare: Apple Heart Study, Fitbit
- White label services (booking any kind of service through an app or site).
Step 2 – Outline your positioning
You need a business plan – a 10-20 page document that describes your startup’s purpose, niche, target audience, advantages, pricing strategy, and monetization.
- Check if your niche is big enough: go to Google Adwords and check how often people google your target service. If you don’t see at least 1000-2000 local requests (people from your city), then it’s likely you won’t have enough audience to work with.
- Make a contractor profile: determine the qualifications and equipment necessary for your contractors. Ideally, the entry-level should be low – anyone with basic training should be able to provide services on the marketplace. On Airbnb, a contractor only needs a free bed, on Uber – a car, on GrubEats – anything that will transport you to the food order location.
- Check if your concept is feasible: imagine yourself being both a contractor and a user. Sometimes, business owners want to attract clients and end up setting unrealistic conditions for service providers.
- Choose a tech stack: describe what programming languages, frontend, and back-end technologies you want to use and write software requirements. If you aren’t an expert, consult a software development team on how to make an on-demand app.
Step 3 – Create a minimum viable product
Once you have a business plan and understand your concept, it’s time to test the idea. You can do it with a stripped-down version of your application. The MVP should feature only essential features and simple interface, which will be cheaper to make.
- Create a test group of potential users and contracts. Determine the audience where you will advertise your MVP. The product is far from perfect on this stage, so don’t aim for more than 100-200 users.
- Test the MVP on clients and contractors. You should get feedback from all involved parties. They will provide you with valuable insights on how to make an on demand app.
- Create a feedback mechanism. Make sure that your app or website features a dialogue window where you request feedback and explain that this is only the basic version. To get users to answer, give them a bonus.
Show your MVP to investors. Even if you aren’t actively looking for funding, getting a slap of reality in the face doesn’t hurt. Investors won’t hesitate to tell you why the solution isn’t viable – take it with the grain of salt but work on resolving identified issues.
Essential functionality for a minimal viable product
The minimum viable product is designed to be simple. We analyzed our on-demand projects and the most prominent market cases – and here’s the list of absolutely necessary functionality that we came up with.
How to build an on-demand app: functionality
- An on-demand app has two versions: one for the client, another for the contractor.
- Account creating and settings: singing up, logging in, data protection;
- Order management: a page for creating orders (client) and accepting them (contractor);
- Order monitoring: tracking active orders, viewing history, and personal efficiency (for contractors);
- Payment systems: you can integrate a ready payment gateway like Paypal or Stripe;
- GPS: not all on-demand apps are concerned with locations (for instance, if your marketplace offers on demand-essays, you won’t need location), but most niches do;
Notifications: users should be alerted about order progress, reviews, and rating updates.
Step 4 – Create the final version of the app
If your MVP was well-received, it’s time to make your product not just viable, but attractive. If not, improve the minimal functionality – but eventually, you’ll get to this stage. So, how to make an on demand app that retains users? The answer is additional functionality.
- Intuitive interface: your minimum viable interface was just simple, whereas this one also has to be stylish. It’s time to think of a brand identity. Employ a designer who will create a guidebook, define your style, main colors, and incorporate them into the interface.
- Improving performance: you can add or substitute your code components to decrease the load time, process more requests, and work in low-latency.
- Personalization: you can incorporate big data, Artificial Intelligence, and Machine Learning to analyze users’ purchase history and preferences.
- Enable learning: dedicate a section of your website or mobile app to contractor support and create an education center;
- Create a testing system: this is how you can verify contractors’ skills and encourage improvement;
Develop a bonus program: the most active contractors should receive rewards.
Step 5 – Bring your solution to the market
The next step is assembling a community of contractors and clients. You should launch separate advertising campaigns for them. Pay-per-click advertising isn’t the only way – here’s what else you can do.
- Cooperate with existing companies: you can make deals with brands to use their resources for commission fees;
- Encourage loyalty programs: users should be able to spread the word and bring a friend for a bonus;
- Be active in social media: invest in your Instagram, Youtube, Twitter, and Facebook accounts, and start advertising campaigns;
Reach out to experts in the field: ask the experts in the field to review your app (possibly on a paid basis) and share the opinion with their audience.
Dedicate a good portion of your budget to these activities:
Syndicode’s case of developing an on-demand app
HLPRs is a house cleaning on-demand app that connects side-workers (cleaners, babysitters, handymen, and others) to customers. It’s a full-cycle service: the web app handles order creation, invoicing, support, customer reviews.
With Ruby on Rails and React.js, we built two versions for HLPR’s web marketplace – both for a customer and contractor. Firstly, we focused on building personal profiles and order-management functionality – the essential features of the on-demand marketplace.
Then, we made the user experience better based on their suggestions and reviews by adding the following features:
- personalized routes to clients in a contractor profile
- European payment systems;
- screening and education systems (tests, ratings, certificates, courses);
- automated invoice creator and money withdrawal;
- improved search filters – workload, location, schedule.
Results: we created an automated handyman on-demand app where side-job orders are made, accepted, and executed in seconds.
To sum up
With the right approach and tech stack, any niche can be switched to an on-demand basis.
You need a concept, defined target audience, vision of essential and additional functionality, and a sustainable business model.
Our on-demand app development experts can help you with every step of on-demand development: from concept validation to development and testing.
Be it transportation, delivery, side-gigs, or fitness – we are happy to help.