Planning out my start up I find my self leaning towards a variation of the long tail model, Boutique Software, highly specialized designer software designed specifically for high paying individual customers who don’t want to be among the masses using generic software. The concept appeals to me since I’m into providing services with a human artistic touch, rather than pumping out enterprise grade application that can be easily customized to fit the broadest rainbow of requirements.
For me product development is a form of art, keeping in mind that all forms started out as industrial activity. I consider myself “software as an art” evangelist. Art influences people, also art is priced in a completely different manner than normal industrial products. You can easily relate this consider how your normal every day mass produced clothes compares to high end hand made custom fitted designer outfits, based on price quality and impact, I believe its about time to take the same paradigm to software.
Mass production factories can pump out products faster and cheaper than smaller ones, however boutiques that build high quality highly personalized products generate a bigger profit per employee, and its all about perception, customer’s are cost conscious when it comes to mass produced products, but when it comes to boutique items sky is the limit. As a small software house there is no way for me to compete with mid-sized companies who can pump out “industrial” software faster and a lot more cheaper. Building software art pieces, customized to certain niche I believe that my products would have a chance.
Boutique apps, targeting niche market, how would that generate enough revenue to sustain and justify the existence of a company. The way software generates revenue is quite different than how normal products do, unlike normal products, free software can generate even a bigger profit than paid software. These days software generates profit through either promoted content and targeted ads. The more targeted the ads are the more valuable they are to ad agencies, the beauty of targeting a niche market, is that you know exactly what type of people you are targeting which is nothing short of a gold mine to marketers.
I believe its an interesting paradigm, still in early development phases, but I can see it has a lot of potential.