There are a few apps that I typically recommend people run away from, largely because the market for them is flooded. Backup apps. Photo organizers. Product management web apps (which is overrun largely because Basecamp is amazing and the code to it practically writes itself in Rails, since Rails is after all “Basecamp, minus the domain expertise”).
The trouble with getting into an uber-crowded market, in a niche which is essentially a commodity service, is making yourself heard above the din. So instead of being Generic Photo Organizer #1278, maybe you could be World’s Best Photo Organizer For Wedding Photographers. This allows you to carve out a little niche which is addressable (i.e. you have some way of reaching them, for example when they Google [photo organizer wedding photographs]) and which will leap at the chance to pay you money.
I saw a beautiful example of this, which was just released this week: ProjectThingy. It is *yawn* project management software. But it is project management software which you can embed in your own website, and I’m convinced that makes all the difference in the world to a certain population of technically disinclined SMEs.
The author (Chris Ritke of 49things.com) also has a stable of other embeddable applications. One of them is UploadThingy, also swimming in a crowded, crowded market (crikey, I think at least four of those have come through the Business of Software boards alone), against competitors with great PR like DropSend and a few startups with millions in VC funding.
I predict he goes on to make a mint with that selling point. And indeed, the UploadThingy already has 100 paying customers, which is probably somewhere in the vicinity of $3,000 a month in revenue (I worked from DropSend’s published statistics about plan uptake rates and projected it to 100 total customers). A (very) nice sideline for the moment and with two sister-apps just launched he should be raking it in by the end of the year.