How to find Shopify app opportunities: The Analytical Approach

We already built a Shopify app (https://apps.shopify.com/restock-alert), We decided to build our next app with a new approach. Here's our approach:

Shopify stores, no matter the shape and size, flourish by spotting new opportunities to solve eCommerce problems. That’s why there is an estimated amount of 6000 apps by more than 2000 publishers on the Shopify app store.

Shopify App Ideation 101:

Our mission here is to find which opportunities and scopes exist in the Shopify app world that would result in growth and revenue for the developers, which as Shopify calls it: App Ideation💡
Now what metrics help us to decide where would be the best fit for a new app idea:

• Market Size and Growth Speed of
  -- Revenue
  -- Number of Stores looking for it
• Competition in
  -- The degree of monopoly or multilateral
  -- Emerging / old target market
• Ability to innovate and develop a new product in that market
• Ease/quality of product development for our team (in-team index)

❔There are some data that would help (but there’s not, unfortunately)
The amount of installation and revenue of the actors in the market of the desired products

Now, what data did we have?

• Customer reviews of Shopify apps
  -- Number of reviews and growth rate per app and each product type and product category
  -- Customer satisfaction (1 to 5-star reviews)
• Information about each app
• Pricing, product features, the longevity of product reviews

Now to the Shopify app opportunities

Because we do not have access to accurate installation rates and revenue data for each product, it is best to estimate growing customer needs and entry opportunities in several ways. So here are the 4 opportunities that we could use to make an app for Shopify that would benefit us and store owners:

Choose product ideas from growing and unsaturated categories

This was the first criteria, it’s simple, the Shopify app marketplace is a vast one, in periods of time, there will be a trend in a category, which results in growth in the number of reviews for the apps in that category and there are not hundreds of apps doing the same thing.

How to analyze:
There are various categories in the Shopify app store, you can find all of them here
So with that in mind, we tried to stick to a statistical method to analyze the speed of reviews coming in for the apps, but there are some things to consider like there are some apps that have been there for a looong time, there’s also competition index which means that in some of the categories, there’s a massive competition that results in reflux of reviews.
Here’s one of the charts we came up with:
https://i.imgur.com/pmFnKwR.png
https://i.imgur.com/c0YNo2K.png

Selecting product ideas from reviewing the categories that are needed but the quality of the products is low

This one is interesting because there are literally apps for everything on Shopify app store, but are they good? This is another criteria we chose to analyze:

How to analyze:
There are some signals that can show you this easily, namely:

• Average low product satisfaction (percentage of ratings below 3, more than 10%)
• High number of reviews, which indicates the minimum demand for this type of product
• Minimal growth can be seen in this category of apps (growth in the number of reviews per month)
• The category in question is within our scope of work (many categories with a high average of dissatisfaction are of the category, which is related to the transfer of goods, warranty and guarantee services)

This criteria is great for those who want to take something good and make it something great. The marketing will be harder at first, but if the product is good, well don’t worry.
Bonus: Here’s a screencap of the latest study we did, you can use it if you want to ;)
https://i.imgur.com/b2HdDwi.png

Selection of product ideas, from reviewing emerging products in Shopify (our favorite)

In the previous method, the survey was performed from the macro-level to the partial level. But in this review, due to the initial macro view and filters at the product category level, some attractive trends in product types may be ignored.
This means we need to add in a little bit more research and find apps that are flourishing in the marketplace without taking the product category into consideration

How to analyze:
How can you find those? We created this quick formula, which is not bad in our opinion:

• 2021Q1 reviews > 2020Q3 + 2020Q4 reviews > older reviews

Got any other formulas that you can think of? Let us know in the comments!

So What we did:

Using the first method, we analyzed 89 Shopify categories by seeing their review progress and we got these top 10 categories that seem to be a great fit for us!
https://i.imgur.com/PGcW9WS.png

So we found a subcategory that had a good potential for growth and we could build that! We stuck to Inventory management and created a cluster of the mini-categories of these too and did the same analysis again.
Shopify highly values apps that are actually aimed to help the merchants and we decided, why not? And speaking to some merchants and review analysis narrowed down the exact app ideas to three final candidates.
The flow can be summarized in a big brain flowchart we did:
https://i.imgur.com/dQzY3eH.png

Bonus points:

• This is a process we came up with to determine which Shopify app idea can be a good place to start our process. However, there’s one thing that you MUST consider when you are deciding what apps you want to create and it is your abilities (or your team). From executing to marketing and customer support, having a Shopify app is time-consuming and hard work, so make sure this is something that you will be able to work, market, and support.
• Shopify’s documentation is really complete, make sure to check it out and never forget to read through the Shopify Polaris. If you don’t know about it, make sure to read it all here.
• Connecting with other Shopify developers can be one of the best things you can do in the process. Join communities, join Shopify's official discord server to build a community, and get advice that is nowhere to be found.
• Join the Shopify App Challenge if you haven’t, especially if you’re new. The app challenges are a great way to start your Shopify development journey.