How Much Should You Spend To Build An App?

(By Ritika Puri)

In addition to understanding what your customers want, focus on what’s most likely to scale. After you validate your idea, think about distribution, think of the App Store as a grocery store. How will your app stand out not only in your category but among the rest of the apps in other categories that are vying for user attention?

A mobile app can be a powerful investment for your business. A well-executed idea can help you build supplemental revenue streams, boost customer engagement or introduce new products and services.

If you’re thinking of jumping into the deep end of app development, one of the first questions you may have is how much it costs.

Recently, a community member asked, “For anyone who has created their own app, am I able to get my design out there without spending thousands of dollars to do this? I am in the process of designing an app for my business, but am running into roadblocks and am confused about how much I should have to spend initially.”

The answer is far from clear-cut. Building an app can range in cost from anywhere between a few hundred to tens of thousands of dollars. It really depends on two big factors: what you want to achieve and your anticipated return on investment.

Setting Your App Budget

Even if you have an infinite budget with which to get started, you need to make the most out of your investment to ensure you’re getting exactly what you want. These three tips can help you make smart decisions—and get the most bang from your app-building buck.

1. If you’re not sure exactly what to do or how much to spend, turn to your customers. “First and foremost, validate the idea,” Steve P. Young suggests. As a mobile marketing consultant and founder of Mobile App Chat, a podcast for mobile app developers, Young is basing his advice on real-world experience. “We no longer live in a world where if you build it, they will come,” he says. “As with any business, make sure there’s a real need in the market for your idea.”

In addition to understanding what your customers want, focus on what’s most likely to scale. “After you validate your idea, think about distribution,” Young recommends. “Think of the App Store as a grocery store. How will your app stand out not only in your category but among the rest of the apps in other categories that are vying for user attention?”

Passion is also invaluable for guiding your strategic plan. “Don’t build an app because you think it’s a good idea or you think that the world needs it,” Young says. “Build something that affects you in a deep way.”

2. Distinguish between features that are “musts” versus “nice to haves.”Invest in critical features that give your app the strongest value proposition possible. The key is to position your product as a need rather than a luxury. “Think of a ‘must have’ as something your customer would use every day,” Young explains.

And don’t forget that the “must versus nice to have” decision is in the eye of the beholder. During the time he has spent working with a number of mobile app developers, this perspective has been invaluable to Young. “Some people will say ‘Words with Friends’ is a must-have because it takes their mind off their daily stress and allows them to stay connected to their friends,” Young explains, “whereas a ‘nice to have’ is something you’d use just once in a while. I absolutely love ‘HotelTonight’ and ‘Uber,’ but these tools are not solutions that I must have.”

3. Understand the full picture. Mobile app development will frequently come with unforeseen costs. Make sure you have a complete picture of the investment so you can budget effectively. For instance, in addition to paying designers and developers, you may also need to invest in pieces of core infrastructure for your business.

“Some often-overlooked costs are the hardware and server infrastructure needed to run the application and the ongoing services to maintain those technology environment,” explains Erin Kelley, CEO at Simply Smart Technology, a Chicago-based IT support services company. “Most applications will need to store data and talk back to a central server in order to run and work in the real world.”

And expect costs to scale proportionately to your user acquisition. Be sure to develop a plan that incorporates these costs upfront, Kelley recommends. “Any out-of-scope work will either be declined or done at an additional cost,” she says. “Some firms charge a higher rate for change work, so make sure you understand the base rate and change rate before you move forward with a developer.”

By doing your homework first, you can get the most from your app budget, no matter how big or how small.

(Source: Openforum)

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