Shyp App-story of its failure, mistakes, and lessons

If you don’t want to stand in the queue to ship your package or go to the post office to post it outside the country and you want someone to come and pick it up for you then the Shyp app is for you.

In this app, you just need to upload the image of your package the delivery guy will come and pick it up for you and the price is just $5.they made sure of your convenience in delivering your packages

The Shyp app was escalating at that time in California. People started to recognize it as Uber for deliveries. Company then decided to launch the app in other big cities like New York and Chicago. But there the app didn’t do well and after 5 years the company falls.

In the following blog, we will learn about the Shyp App, its Success, and what led it to its failure.

What is Shyp App?

After Uber’s Success other on-demand services had left people to ask for more. The Shyp app was trying to provide people convenience in shipping their package.

Well, the Shyp app wanted to provide their customers the service where they only need to post the image of their product, then a delivery guy is assigned then they will come to pick your product to ship it where you wanted it to be.

The company then takes your package to the warehouse where it will be packed properly and then shipped through FedEx, UPS, or other delivery services.  

Early Success Of Shyp App

 

This app was first launched in San Francisco as a beta version and it worked out pretty well. people prefer on-demand shipping app and with the help of a lot of delivery agents across the area, couriers rose very high.
The app was very user-friendly and soon become the first choice of users. The main reason for the rise of the app is that it focuses on the subject of the delivery chain which was often overlooked by the companies.

Joshua Scott put it succinctly: "eBay aided in easy online shopping, and PayPal aided in easy online payment." Shyp will now assist small businesses not only in saving money but also in creating markets.

In the middle of 2014 SherpaVentures spent around $ 10 million and only after a year, they were negotiating investments worth $50 million. At that time it seemed normal to develop.

After the success of the Shyp app in san Francisco they decider to launch the app in New York, Chicago, and Miami. the business was going in the right direction, the company was worth around $250 million with total funding of $62.1 million.

What is the cause of the Shyp app’s failure?

Shyp received a lot of praise from the residents of San Francisco in 2013 for the services it offered. The software used an on-demand service approach, which is unquestionably popular in the industry. The ability to pick up parcels in 20 minutes made consumers fall in love with the Shyp app, resulting in a $62 million profit throughout the operation.

If we get into the failure of the Shyp app, the biggest cause is that it overestimated the no. of users that want the Shyp app for their delivery regularly. Due to this blunder, they need to charge $3 as a packaging fee.

Unlike fundamental services like taxi rides and food delivery, which most people now use at least once a week, shipping stuff is a rare occurrence. Shyp began recruiting small businesses (that ship regularly) to join its shipping movement to make up for it, even providing volume discounts.

Later in 2018, business CEO Kevin Gibbon stated that he concentrated on engineering and development rather than targeting the proper demographic, creative features, and growth methods. He said that the Shyp app had fallen into a growth trap.

In the case of Shyp, to keep prices as low as possible for customers, they ignored the costs of renting physical warehouses, packaging materials, and hiring driver agents, among other things. This increased startup funding.

Shyp started adopting Uber’s Strategies and that is where their downfall started. Established businesses benefit from financial flexibility, which allows them to experiment with different product categories. Similarly, Shyp attempted to investigate new product categories despite a lack of financial backing.

Shyp progressively moved its focus away from individual orders, which were uncommon and unreliable, into partnerships with small businesses that supplied items regularly, but it was too late. The business eventually chose to halt its expansion and concentrate on its mainland headquarters, San Francisco. As a result, the New York, Los Angeles, and Chicago operations were shut down.

Opinion On Shyp App Failure

Shyp's story is a perfect example of the difficulties of transitioning a great business model from development to strategic planning and marketing. This is true for any company that is entering the market and is confident of its success like Shyp.

Being too focused on an idea and the technical innovations that can be implemented can make it difficult to get a good picture of demand, what consumers are likely to pay, and thus the types of goals that can be met. Finally, ignoring the advisors by the founder may result in a catastrophic failure.

They were doing everything they could to stick to their current priorities and expectations in terms of customer base, service areas, and employee numbers. The initial errors, however, were far too large, and the cost of on-demand distribution became unaffordable.

Conclusion

 

It is not an easy task to create a perfect mobile app. It is full of difficulties and setbacks. Thus, before beginning the app development process, one must research the market, understand the target audience, and devise strategies to help your app stand out.

The Shyp app was also no so perfect. They made blunders in their market tactics and planning. To avoid making the same mistakes, work with the best mobile app development company that can assist you with strategic development and marketing.