Background Loneliness is a significant well-being issue that affects older adults. Existing, commonly used social connection platforms do not contain facilities to break the cognitive cycle of loneliness, and loneliness interventions implemented without due processes could have detrimental effects on well-being. There is also a lack of digital technology designed with older adults. Objective We aimed to iteratively design a user-centered smartphone app that can address loneliness in older adults. The aim of this study was to investigate the loneliness-related psychological processes that our conceptual smartphone app promotes. We also identified the emergent needs and concerns that older adults raised regarding the potential benefits and detriments of the app. Methods We used technology probes to elicit older adults’ reflections on the concept of using the app in 2 studies as follows: concept focus groups (n=33) and concept interviews (n=10). We then conducted a prototype trial with 1 week of use and follow-up interviews (n=12). Results Thematic analysis explored the experiences and emergent challenges of our app through the design process. This led to the development of 4 themes as follows occurring in all 3 qualitative data sets: reflection on a digital social map is reassuring; app features encourage socializing; the risk of compounding loneliness; and individuals feel more control with mutual, socially beneficial activities. Conclusions Smartphone apps have the potential to increase older adults’ awareness of the richness of their social connections, which may support loneliness reduction. Our qualitative approach to app design enabled the inclusion of older adults’ experiences in technology design. Thus, we conclude that the older adults in our study most desired functionalities that can support mutual activities and maintain or find new connections rather than enable them to share an emotional state. They were wary of the app replacing their preferred in-person social interaction. Participants also raised concerns about making the user aware of the lack of support in their social network and wanted specific means of addressing their needs. Further user-centered design work could identify how the app can support mutual activities and socializing.