Introduction
Wondering about the cost of making an app? It’s a common question that app brands and developers ask when embarking on an app development project. Estimating the cost is a crucial part of budgeting for any mobile app venture. Sometimes, as a company owner, you find yourself pondering two options: hiring an app development company or developing the app in-house.
Both approaches have their pros and cons. Let’s shed some light on how each option can impact the app development cost by taking a closer look.
App development companies that have been in the market for several years possess the right skills to efficiently handle complex multi-platform mobile app projects. These projects can involve advanced mobile technologies such as Machine Learning for powerful computations, augmented reality, Blockchain, IoT, and more.
When it comes to app development, leading companies have the advantage of learning from their mistakes and quickly outshining the competition. Working with an experienced team like this ensures that you won’t repeat the same mistakes. App development is a multi-step process that requires careful planning and adhering to a timeline, all of which can be streamlined based on past experiences.
Opting to create your mobile app in-house can initially reduce the development cost. However, it’s important to note that over time, dealing with bug fixes due to inexperience may actually catch up to the price tag you would have paid for an app development company. The decision ultimately depends on your specific circumstances and goals.
Determining the exact app development cost is not an easy task, as it involves multiple factors that collectively influence the final figure. Fortunately, there are several factors to consider when forming your app development budget, which will help you come up with a ballpark estimate.
Remember, each app development journey is unique, and taking these factors into account will give you a clearer idea of the potential cost involved.
App Development Influential Factors:
- App functionality and purpose – what an app will actually be capable of doing for its users.
- Mobile platforms and devices supported – whether an app will be developed for iOS only or has an Android version as well. What specific devices hardware will it support, e.g. iPhone 13, iPhone 12 Mini, Samsung Galaxy S10 Plus, and so on.
- Integration points – will an app be integrated with third-party apps that will be the source of its content.
- Use of visual objects – complexity of visual objects inside of an app will significantly influence the cost.
- Use of smartphone hardware features – whether an app will be using such smartphone features as GPS navigation, NFC technology, motion co-processor, Augment Reality tech, and other technologies that are packed into smartphones or tablet computers.
- Maintenance plan – once an app development project is over, certainly it will require technical support from its developer to provide updates that patch bugs or introduce new features.
Having said that, there are some typical or average benchmarks for app development project costs that we can apply to different types of apps. These benchmarks range quite widely, based on data from multiple companies that have deduced these app development costs based on their customer projects research.
App Development Benchmarks:
- Simple app development price tag – $16,000 – $32,000
- Medium complexity app development price tag – $32,000 – $48,000
- Complex app development price tag – $72,000+
In the rest of this research, we set out the available data on the development cost for apps using a range of different sources and methodologies.
What platform is your app development project?
Having a general idea of the costs involved at each stage of app development is crucial for companies to effectively allocate the venture capital they raise throughout the entire mobile app development cycle.
In 2017, Clutch, a reputable B2B analytics company, conducted research by collecting data from over 100 app development companies. The research provided insights into the percentage of expenses allocated to different app development stages, including Discovery, Design, Development, and Testing & Deployment.
When it comes to the pre-research stage, 51% of company representatives stated that it costs up to $5,000 to generate an initial concept and conduct research. Additionally, 22% exceeded the $5k threshold, investing $10,000, while 14% allocated funds ranging between $10,000 and $25,000. Clearly, compared to other app development stages, Discovery stands out as the most cost-effective one.
Understanding these cost ranges helps companies make informed decisions and manage their budget efficiently throughout the app development journey.
App Development Cost Benchmarks
Since the early days of major mobile platforms, the cost of developing apps for iOS and Android used to differ significantly. However, in 2022, according to research conducted by reputable app development companies, the cost of developing iOS and Android apps has become almost identical. Now, the primary factor that determines the app development cost is its level of sophistication, which can be categorized as Simple, Medium, or Complex.
According to insights from SPDLoad, a trusted app development company, a simple app typically takes around 2-4 months to develop, a medium complexity app may require 4-6 months, and a complex app could take 9 months or more. It’s important to note that these are estimates, as the actual development timeline is influenced by the coordination and productivity levels of the app development team.
Considering the hourly rates provided by Salary.com, which currently average around $50 per hour, the cost of a basic app with a straightforward user interface and basic features ranges from $16,000 to $32,000 in the United States. For a medium complexity app, the project cost would fall between $32,000 and $48,000. Lastly, a complex app project would require a minimum investment of $72,000 or potentially even more.
Remember, these figures serve as general guidelines, and actual app development costs can vary depending on various factors such as specific requirements, additional features, and the expertise of the development team.
App Development Cost [stages]
Having a ballpark for how much different stages of app development may cost is crucial. It allows companies to allocate properly the venture capital they manage to raise along the whole cycle of the mobile app development.
Back in 2017, research conducted by Clutch – B2B analytics company outlined the data collected from more than 100 app development companies. It provided a percentage for how much companies spend on one of the following app development stages – Discovery, Design, Development, and Testing & Deployment.
So when it comes to conducting a pre-research stage 51% of companies representative said that it costs up to $5,000 to come with an initial concept and do research. 22% went above the $5k threshold and spent $10k and 14% spent anywhere between $10 and $25k. Clearly, compared with other app development stages, Discovery is the cheapest one.
Discovery/Pre-Research stage
Source: Clutch
When app development teams proceed to the Design stage, 32% spend less than $5,000, but only 9% venture to spend over $50,000 on an app design. The majority (60%) says within $5 – $50k.
UI / Design stage
Source: Clutch
Development is the major part of the whole mobile app development process, it’s about the actual coding of every feature that an app is supposed to have. For only 9% of respondents the sum they spend on developing an app’s code was below $5,000, for 33% the money they spend on this stage was within $5k-10$k.
Development stage
Source: Clutch
It’s impossible to conceive any app development project without testing and deployment stages. Around 32% of respondents spent less than $5,000 on app testing and deployment, while approximately 31% stayed within the $5-$10k range. The remaining respondents allocated over $10k for the Testing and Deployment stage.
Testing and Deployment stage
Source: Clutch
Obviously, the core factor that defines the app development cost is an app’s complexity. For example, whether there is a backend server that provides information for the app or not, whether an app has a built-in user analytics, a backend CMS support or not, if it has a built-in shopping cart or social media sharing features, and so on.
The hourly rate for mobile app development varies in different parts of the world, it reflects a level of economy development in a particular country. On the graph below, we can see that among six regions India has the lowest average rate – $7 / hour and the US is on the highest end with $47 / hour, which is not a surprise at all.
App Maintenance Cost
Like any software, mobile app development cost has a maintenance component. The industry average accepted cost to maintain software is roughly 15-20% of its original development cost. The maintaining process cost can be broken down to the cost of hosting, monitoring, engagement, marketing, updating, and licensing apps.
Hosting
The decisive factor in a mobile app backend data hosting cost calculation is what kind of data the app deals with – text or media, such as photo, video, or audio. A media-rich app would require a higher CPU web-server with more RAM and disk space. Based on these factors, an app hosting web server may cost between $70 to $320 a month. The leading web hosting solutions to choose from would be Amazon AWS, Microsoft Azure, or Google Cloud.
Monitoring
Mobile app monitoring is really essential for its success. Due to the unique audience and varying number of users for each app, it’s impossible to provide a precise estimate for mobile app monitoring costs. However, when contacting the companies on the list, be sure to request a ballpark range for your app maintenance expenses.
Engagement & Marketing
A mobile app marketing cost, which includes activities to engage a mobile app user base, consists of multiple components. Any mobile app engagement begins with an app install, a price an app marketer pays for the app’s install depends on the country, platform (iOS/Android), and specific ad unit. In 2021 the iOS CPI (stands for Cost-Per-Install) was $3.6 / app install and on the Android side was just $1.22 / app install. As we go more granular, from a generic app install instance to a desirable action the app user is expected to take, we can talk about an average mobile app user acquisition cost. In 2020, the average app UA costs worldwide were the following:
- purchase made via a mobile app – up to $75
- subscription – up to $70.
App Updates
Every single mobile app ever released on an app store, either iOS, Android, Windows Phone, or other platforms needs to have subsequent updates to be released after its launch. On one hand, it’s simply not feasible to develop a perfect app with version 1.o, from the other – subsequent updates are a great tool for a continuous app user base engagement. An actual update release on an app store may take around one hour but the time that it takes to develop an update is significantly varied and depends on an app’s complexity.
Licenses
If a mobile app design incorporates one or more technologies that the developer should pay a license, it may significantly increase an overall app development cost. A license fee to pay depends on annual fees to pay, a number of devices, and, for instance, may reach $120k / year for 50 devices.
Conclusion
When businesses estimate the development cost of their future app, there are a few key factors they should consider in a friendly manner. Firstly, the location of the development team and the complexity of the app play a significant role in determining the overall cost. Since both iOS and Android platforms enjoy high adoption rates, it’s a smart strategy for businesses entering the mobile realm to develop an app for both platforms simultaneously. By doing so, they can effectively manage infrastructure costs, which are a major contributor to the overall development cost. It makes logical sense for companies to explore ways to save on expenses related to data storage, scalability, and third-party API integration by choosing cost-effective options available in the market.
Moreover, the COVID-19 pandemic has had a substantial impact on app development costs. It has forced app developers to adapt by working remotely, leading to changes in the cost structure. Contact us today, we will offer you the best solution for your business.
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