In 2019, if you dream of a successful sustainable business, you need to look for your customers in App Store and Play Market. There are already one billion smartphone users across the world, and most of them spend 3 hours per day in contact with their devices. Almost all of this time they are using mobile apps.
The majority of all successful applications covers the following areas: games, education, healthy lifestyle, communication, and business management. In our article, we will provide you with some basic notes on how much the apps’ development costs, what affects the budget and what can help you reduce it.
There are several ways of creating an app but it is certain that most of people might have great expertise in their field of business and not have enough technical or marketing skills to launch an app themselves. To build an app you need teammates performing expertise in branding, software development, business planning, marketing, and management. You have the following options to have the work done:
Outsourcing. 72% of global companies use outsourced labor when it comes to IT needs. The main reason: outsourcing development costs two and three times less than an In-House one. Outsourcing means that you assign the development tasks to a third-party team. You don’t control each of its stages, but the project manager does. As a result, you get a ready-to-use application and pay for it.
Outstaffing. Another form of remote collaboration is hiring employees for a certain time period from another company. In this case, you set tasks for hired experts and control their progress by yourself. Usually, you pay your teammates a full-time salary. Also, you are the one who is responsible for the final result.
In-House. It is cheaper to keep this development style if your company has a constant need for experts in certain IT areas including design, software engineering, and QA management. The In-House concept assumes that there is an IT department in the structure of your company. In fact it the way to make your mobile app development cost higher but to get a full control of the process.
Freelance workers. It will work for you if you have a clear idea of who is exactly needed to implement your app idea. In that case, you’ll also need extra time to stay in constant contact with your fragmented team. Freelance workers perform their duties remotely and rarely meet each other. The advantage of this approach is the ability to negotiate with each employee on individual terms and save costs. By hiring freelancers you can also get a team with expertise in some rare field.
It is not a secret that the app’s success mostly depends on the team professional level. Future app’s features, timelines, and the chosen platform define if you need 5 or 100 employees to develop it. Their hourly rate also may vary. Here, we described the main types of team members and the average cost of apps development in the world.
Note: for making an app, your stable team must have at least 4 employees (PM, Programmer, UI and UX designer, and QA). The most productive units usually consist of 10 people, 3 of whom are software developers.
$40—70 per hour (here and further the middle Eastern Europe rate was given)
Visionary functions may be performed by Project Manager, Business Consultant, Business Analyst, and Strategist. The task of the team member is to stick to the ideal form of a mobile application, assign responsibilities, and control the development process in general.
$35—77 per hour
The design department defines the visual concept of the application but most of the design work concerns the inner app logic. The design team usually includes Application Architect, Strategist, Navigation planner (UX), Visual designer (UI), and Content planner. Sometimes several functions are performed by the same person.
$25—70 per hour
Mobile application developers actually build an application. Their work begins where the work of UI/UX specialists ends. With layouts at hand, developers and Data Modelers create applications in the programming language relevant for the project: Java or Kotlin for Android, Objective-C or Swift for iOS, C # for Windows Phone, etc. If you plan to launch a cross-platform app, your project requires developers who work with HTML, CSS or JS. Another cross-platform type is compiled to native app developed with React Native or Native Script and Java (Kotlin) or Swift (Objective-C).
$30—63 per hour
Before the launch day, you need to make sure that your app works perfectly. QA specialists will help you to cope with the task. QAs conduct testing and return the product for revision if something works incorrectly.
$10—70 per hour
Marketer are responsible for target audience reaching. If you plan to create a Freemium or any other commercial app, marketing department shall develop a strategy for making a profit from in-built advertising or in-app purchases. The department may also include Copywriter, Designer, Brand Manager, Database Analyst, and Infrastructure Analyst.
In any case, the number of your team members depends on your product. For example, the development of native applications will take more time comparing with cross-platform apps’ development. Another general rule is: the more features you want, the more people you need to implement them.
Most people use Apple’s iOS and Google’s Android. The iOS audience is more solvent, while the Android audience is wider. Also, the popularity of operating systems varies by country. If you want to get customers in a particular region, you need to check which platform dominates the regional market.
In addition, there are applications suitable for both platforms. They are called cross-platform apps. Let's define the strengths and weaknesses of each type.
iOS (iPhone apps) — Objective C and Swift
Android apps — Java for Android and Kotlin
Example — Gmail, PayPal, Google Maps, LinkedIn, Twitter, Telegram, PokemonGo
Applications of this type are developed individually for the platform you need. This development takes more time and money. Resources need to be doubled if you need native applications for iOS and Android at once. Android app development usually costs from 10% to 15% more.
There are following advantages of Native apps: visual showiness, flexibility and, as a rule, extra convenience. The application can use your camera, GPS and other systems.
By opting for native app development, you’ve got a chance to create an appealing product with well-developed UX and UI design. Naturally, users will prefer good-looking and convenient application while having an alternative. Native apps also allow you to implement a wide range of features and deliver your services in the best way.
An additional advantage of Native apps is a strong iOS or Android technical support. Use effective ready-made solutions in the field of animation, adapt your app to the capabilities of special gadgets and strive for higher revenue.
Native apps also work quicker so in most of the cases, they are worth spent money (video editing apps, games).
HTML and CSS
Example — Novarum Reader, Survey Solutions, Storyo, Baskin Robbin
Most applications of this type are limited to iOS and Android use. Their languages follow the web standards and therefore are universal.
Of course, the app will not look the same on different devices, but at the same time, you’ll have a chance to customize the app view for different platforms. Here lies the main drawback as a cross-platform app is significantly limited in visual and functional features and is deeply standardized. Comparing to Native apps cross-platform one may look simplified and boring.
The advantage of Cross-platform apps is a chance to save up to 80% of your development budget. Cross-platform apps development does not require the knowledge of the highly specialized language, so the labor market in this area is wider while the hourly rate is lower. Another advantage is the opportunity to reach a wide audience.
The more dazzling your design is the more users you will attract with your app. Design affects traffic, conversion, and ROI because it affects people's involvement and the ability of the product to be recognizable.
Design goes deeper than the visual shell of a mobile application, so a complex app with a minimalist design could cost investors more than a simple app with breathtaking animation.
Generally, making an app means that you have to think of some design key points:
- The complexity of the app architecture requires designer ingenuity.
- Large app and Database increase the number of unique screens.
- The quality requirements make you hire more experienced workers.
- Allegally, the design piece of work becomes harder if you need to implement special features such as Social logins, Camera registration, Location registration services, Chats, Calendar, etc.
- Content Management System complexity raises pricing.
- Native approach usually means that designers prepare 2 application concepts. Android design can be a bit more challenging since there are over 18,000 Android devices in the world.
- In-House or Outsourcing preference will determine how much you’ll need to pay to your workers.
However, it is impossible to estimate the project design soon after getting acquainted with the app idea. Usually, an accurate budget estimate occurs after decomposition. At this stage, the designer receives the task, thinks of the workflow, get its approvement and then calls the price.
A simple Android app requires from 100 to 300 working hours and the iOS app development will need over 350 hours. That means that the minimum startup’s budget ranges from $8,000 to $20,000 in case your app will be developed in India (the cheapest country for software development in the world).
To help you to understand the pricing, we matched basic apps’ features with average hour estimates taken from LANARS practice.
Users may register via email account, social networks or use a personal password. The less information the user needs to fill in by himself, the better the conversion is.
Almost every application has this feature. Notifications help marketers to keep user’s attention or to focus it on special offers. In social networking applications, notifications report on the activity of other users, but in all others, they serve as a means of communication between the app team and the user.
Here, we are talking about UI architecture. It is not enough to build an app’s structure to make the application convenient. You also need to discover the appropriate user flow and to match features and screens. Navigation includes menu, gestures development (scrolling, swiping), action buttons, etc.
Portrait / Landscape view
from 20 hours
The app will be more convenient if the user has the ability to change the orientation of the picture he is looking at. Thus, you can focus the user’s attention on key elements and transform some functions (for example, video watching). The feature is essential for games and video based apps.
from 20 hours
Each application has its own media content: pictures, video, and audio. Also, communication applications usually provide users with the opportunity to share audio recordings and visual content with each other.
from 30 hours
There are several categories of apps that need a geo-tracking feature. HoReCa, transportation, and travel are among them. Depending on how you will use this feature, the development takes a different piece of time. For example, tracking multiple dynamic points on the screen will cost more than just map downloading.
You need ads feature if you plan to benefit from in-app advertising. However, the task seems quite simple as there are a lot of services that integrate advertising into your app without any extra effort from your side (Google AdMob, InMobi, Tapjoy, and Flurry). In case you need a custom feature, mind that the task is quite challenging.
Chat / Messaging
from 80 hours
Communication apps need chats. And if you plan to launch an instant messenger, most likely you will need a whole range of content exchanging types, including streaming video and audio messaging. If your application is not about direct communication, leave everything except texting feature. Do not forget that chats require a notification system.
from 20 hours
If your application is a commercial product based on the In-App purchases monetization feature, you need to develop some purchasing tools. The feature is about the opportunity to review your products, browse them, or select the desired service, pay for them online.
from 30 hours
Having a product listing in your app does not mean that your client can pay you with a smartphone. It is better to add various payment methods to your app if you want to get bigger revenue. Start with Google Wallet, PayPal, Android Pay, and Apple Pay and increase the merchantability of your products. The more payment methods you need, the more costs you need to spend.
It is not surprising that online business itself takes the advantages of online technologies in order to reduce production costs. The main app development costs are usually associated with team costs. The main way to save them is called Outsourcing.
As it was said, in some cases, the budget savings reach 80%, if we compare remote development with classic full-time office teamwork. Contrast is especially noticeable if your business is located in the USA, UK or Scandinavia.
Let's look at the most popular Outsourcing types:
Onshore means that development will take place in your country, but in a specialized company. The cost of the project onshore implementation is lower than the one under In-Built development but higher than ones under other forms of Outsourcing. For example, the UK medium hourly rate for onshore app development costs £44.
Nearshore allows you to develop applications in your time zone country or not very far from it. Nearshore Outsourcing team is easy to communicate with. The concept helps to reduce cost without facing cultural barriers. Example: German companies often are served by Polish teams. Software developer hourly rate in Germany is €22.50 per hour while the one is Poland starts from €15 per hour (according to Pay Scale).
The third option is Offshore that means that you work with the team from the other timezone and with the other cultural background. Today, the cheapest places for top-notch mobile development are Eastern Europe with Ukraine and Poland as the quality leaders ($25–40 per hour), India, Philippines, and Vietnam (from $10) and China ($50 as a middle rate).
Not everyone prefers cheap Asian mobile development. Nowadays, Eastern Europe is considered to be a budget development leader across the world. There are several reasons for it: besides attractive hour rate and competitive team members’ skills, Eastern Europe developers don’t have strong cultural differences with the customers from the US, England or Canada.
In 2018, China, Russia, Poland, Switzerland, and Hungary were on the top for mobile developers worldwide.
There is only a small number of applications that keep their apps un-updated while the revenue continues to grow. Classic chess application is a good example. In all other cases, technical and media updates, as well as a constant dialogue with the user, are necessary.
The better you maintain your application, the more users you will be able to keep on your side. The annual maintenance cost for your application depends on what exactly you are going to change and develop each year, as well as what type of application you own. Here are a few charge items:
- User records store server
- Payment processing
- Emergency maintenance
- Push notifications
- New content
- Analytic tools
- Initial development
The maintenance cost may differ depending on which platform you choose and how well the app was built. Cheap development can be expensive to maintain.
It is difficult to estimate maintenance cost before the test version of the application came to light. As a rule, 20% of the total development cost should be included in the budget according to the usual price list. This money is likely to be enough to maintain your application during the first year.
Applications may look similar, but it does not mean that it took the same amount of time and money to develop them. The development cost depends on the app’s “stuffing”. Let's find out how costly the development of well-known applications’ clones would be, relying on their key features and design:
The world-famous service, in fact, is based on the work of two applications: passenger and driver ones. The first helps you to find a taxi while the second provides drivers with orders and a passenger’s location data. The main focus was made on the innovative taxi features. You can even say that Uber features were doomed to success even with a primitive design. There are basic features of both Uber apps:
- Push notifications
- Direct contact tools
- Data storage (history, reviews, reports personal data)
To create an Uber clone, you need to split the task between several stages: Backend development, Web development, Native apps development for iOS and Android, Design, Management, and QA. Your team needs to spend at least 200 hours on Backend, 440 hours on Development, 400 hours on Design and Frontend and 260 hours on QA and PM tasks. That is $65 000 in total if you build an app in Eastern Europe.
Etsy is a handmade items marketplace focused on the US market. 54% of Etsy customers prefer shopping on the app than on the website. The feature that allows this platform to generate profit is the intuitive clarity of the app. In other words, Etsy helps its users to find the desired product extremely fast and then to buy it as soon as possible. That’s why the UX design and app architecture are the most expensive challenge for Etsy owners. Here you could find key Etsy marketing features:
- Clear User Interface
- Simple stimulating navigation
- Attractive product profile design with customizability
- Simple Login and Checkout (autosuggest, autocomplete)
- Add To Cart Buttons
- Clear user data organization (Wishlist, Save For Later) and offers’ personalization (Recommended, User Feed)
In addition to architecture and design challenges, Etsy is soft development challenging. In particular, the application must have the same basic capabilities as the desktop version and there are plenty of them: payments, product listing, social network integration, messaging, feedback tools, and many others.
Evaluating the average design and development costs we assumed that the Etsy clone requires at least 1200 working hours. That means that you need around $ 350,000–50,000 to code an app like this. Almost half of the budget funds will be spent on design needs.
Instagram, as we see it in 2019, is an extremely complex social networking platform. The success of this service rests entirely on mobile application features. However, analyzing Instagram at the time of its launch and the modern version means talking about two different things.
The initial Instagram is a simple photo editing tool with an extra sharing feature. The similar tool could be developed rather quickly, although the Instagram-2019 clone requires an unpredictable big team and billion of working hours.
So let's choose the middle option and analyze the potential MVP of a modern Instagram app. Here are the key software features of the Instagram app:
- Camera and galleries integration
- Online streaming
- Media storage
- Contacting tools
- Location tracking
- Media editing tools
- Online Purchases
- Advertisement administrating etc.
The sign in option will take around 60 hours to implement it with both Facebook authorization and individual password feature. Profile editing will take 105 hours plus 200 hours for Messaging. Leave 60 hours to Adjust settings development. Media uploading and editing require between 183 and 360 working hours. 35 hours for Social network linking and 60 80 hours for geo and search features. The Instagram clone MVP also requires database architecture that will take over 150 hours for the development.
As a result, you need to pay for at least 1000 working hours for one platform. Taking $50 per hour as a middle rate you’ll figure out that the total bill of building an app from scratch is $120 000.
Let’s face the truth. Nowadays the average mobile user spends more time with a smartphone in his hands than watching TV, shopping offline or seating in front of the computer, so a smartphone is the best place to sell goods to him or her. However, in order to launch a financially successful startup, the team needs to understand how much money and time should be spent on mobile application development.
The application development speed depends on the quality of your team and the number of features you are going to implement. The minimum number of teammates is 5 and it takes around 5 months to build both front-end and backend part on average.
The key question is how you are going to manage your team. The less money consuming option today is outsourcing development in Eastern European. It will cost you $25–40 per hour to start an app and at the end, you will get a ready-to-use product.