Calculating the cost of an app

HOW DO YOU KNOW WHAT THE COST OF AN APP SHOULD BE?

How much does an app cost? It’s a good question and one we get asked all the time.

And the answer can be anything from under £10,000 to, in some extreme cases, £1m+. It all depends on the kind of app you need and the stage of the project you are at. Few organisations would be looking at a six-figure sum for a prototype project but at the other end of the scale, if you are looking to affect organisational change, you should make more than a few thousand pounds available.

Before we get to some examples of typical app costs here’s something to set you thinking:

An app is either going to add critical value to your business or it may actually be your business.

So, how much would you usually allocate to either setting up a new project or a whole new business? £30,000? £100,000? £300,000? Probably not the £5,000 that many people mistakenly think an app costs.

In actual fact, in these days of multiple mobile operating systems and the back-end data/content storage, serving and analysis solutions that are the usually the engine of an app, the typical cost of getting a decent-sized app project, not just ‘an app’ built is probably around £120,000.

That’s the typical cost of native app development, either to cover the three main operating systems, iOS, Android and Windows Phone or to cover the main two systems (iOS and Android) and your back-end (the part of your system that is held on servers that can transfer content to your app or help you administer user accounts, for example).

It’s normally around a third of the cost for each, as a very general rule of thumb. You can consider cloud-based services that can do much of what a bespoke back-end will do, but you will find the costs are higher over the long term and there will be compromises when using ‘one-size-fits-all’ web-based tools. And there will still be costs involved in setting up and testing your app with these API’s. From year’s of experience, we can tell you that only a very few API’s are genuinely plug-and-play.

You also need to consider the ongoing costs of maintaining both your app and your back-end. For the app/s you need to think about upgrades due to regular changes to the operating systems (at least once a year) and also the costs of enhancing the app with new features regularly, to keep your users engaged. Back-end costs include the dedicated or cloud-based server that’s powering the content and data and also any support time. If you have a ‘mission-critical’ app that simply can’t be down for more than an hour without it affecting your business, you’ll need a support arrangement with your developer.

Of course, it’s possible to build apps for less. A really simple ‘brochureware’ app is going to be £10,000-£15,000. Prototypes, to test your idea, are often around the £15,000 mark and that’s a great place to start before you make a serious investment.

 

WHAT DO YOU NEED TO CONSIDER?

Why does it cost what it does? Well, to build the typical app you need these people, at a minimum:

A senior back-end developer
An iOS developer and an Android developer as a minimum*
A Windows Phone developer, depending on your market*
A quality assurance specialist
A front-end designer, experienced in mobile interfaces
A project manager

On top of that you have the development studio’s overhead costs: office rental, desks, computers, mobile devices to test on, heat light etc. And, as this is a business, the studio needs to make a net profit of at least 10% or there’s no point in being in business.

Given that the average project takes three-to-four months and that mobile engineers especially are some of the best paid developers around, you can now see why you should be wary of anyone who says they can build your iOS and Android app for less than £60,000 to £70,000 (or £100,000 if a back-end database and API need to be built). You should be blunt and ask them where they are cutting corners.

If you are being quoted less, then take a look at this page: Why app development projects fail.

If you’re struggling to come to terms with these potential costs, and well, perhaps don’t believe us, take a look at this independent website that has spent a lot of time surveying the market to understand the true cost of building a mobile app.

It’s easy to think that app development isn’t cheap. In actual fact it represents excellent value for money considering how quickly you can build a customer base through app stores; how a properly-planned app can seriously reduce operating costs and increase operating efficiency in a business; or how you can transform loyalty with your customers through a branded experience.

If you are unsure how much your project might cost, get in tough an we can normally give you a ball-park estimate in around 48 hours.

* It’s possible to build an app that will work on both iOS and Android (and Windows Phone) at the same time, using a ‘cross platform’ language like HTML5. The technique, which we sometimes use ourselves when our clients ask us to, often leads to compromises in the user experience so please keep that in mind when you are looking at options. Ideally, cross-platform should only be used for proof-of-concept ideas, or if the user experience needs to be more functional than elegant, like some internal business applications. There is a cost benefit: If two native apps would cost £40,000 each, then the cost of a cross-platform alternative would be around 1.5x the cost of a single app, saving £20,000 in this example. And there will be slightly reduced maintenance costs ongoing, as much of the core app logic is shared between the various app front ends, although if the changes are to the front end, the costs are roughly the same as native app development due to the different screen resolutions each operating system supports and the different gestures each user base will be expecting to use.

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