In the mobile-first world, most businesses rely heavily on mobile applications. And it’s hardly surprising. In 2020, Apple offered over 3.4 million non-gaming apps with a total of 42% of small businesses already going mobile.
As we know it, the mobile-first mindset owes its popularity to the use of personal data. Thus, companies can mine far more valuable insights compared to desktop counterparts. Also, mobile applications offer a convenient and personalized customer journey which contributes to increased sales.
But what about the remaining 58% of small businesses? Most often, the confusion over the costs of app development runs rampant over common sense. With that in mind, this article will break down the average app development cost worldwide and shed light on the MVP development process.
Cost Driver #1: Team Structure
A common misconception is that the total is directly linked with the total of hours allocated to coding. In reality, a mobile app development cost is a puzzle that is made up of various factors.
Thus, a team of coders alone is not enough to get the ball rolling. The least amount of people any project needs ranges from five to six people. But mind that this is the bare minimum. So traditionally, tech partners have departments that fall into divisions. For example, your app development team can include:
- BAs and PMs bridge the gap between IT and business objectives.
- A solution architect creates a comprehensive back-end architecture for a software solution.
- Quality assurance specialists ensure that the end product is up to the company’s quality standards.
- App designers are in charge of the overall look of the product.
Also, if you’re aiming for a complex application with sophisticated functionality, your team structure will be significantly bigger. Let’s say you need an on-demand solution done at very short notice. In this case, the project PM will assign a team of three to four backend engineers and two frontend developers.
Therefore, the total work hours is one of the main but not exhaustive cost items.
Cost driver #2: The Trinity
No matter what kind of project you implement, its quality is always associated with three constraints. These elements go under the name of the Project Management triangle and include scope, time, and cost.
The sides of the triangle address three questions:
- What set of features do we need?
- How many hours do we need?
- What budgetary constraints do we have?
All of these elements are closely related. But how exactly do they influence your spending?
- As your scope extends, the hours and money needed for your project ramp up.
- If you’re pressed for time, be prepared for higher costs and smaller scope.
- If your financial resources are limited, the development time frame may be extended, while functionality may be simplified.
Pro tip: A Minimum Viable Product is a workable solution for a project with a limited timeframe and modest budget. It helps you prove your hypothesis without shelling out for a full-fledged solution.
Cost driver #3: Core Functionality
A set of features is another factor that balloons the costs. If your main mission lies in user engagement, you should include a specific set of features to reinforce this goal. Typically, a user-centric app will boast the following functionality:
- User registration/ social log in
- Simple customer support chat
- Basic admin panel
- E-mail subscription, etc
This type of mobile application will likely fall into the category of simple applications. This group of solutions usually takes up around 400+ hours.
On the other hand, a complex mobile solution like a food delivery application or taxi-hailing app will guzzle up much more development hours. On average, this category of apps includes:
- Media content sharing
- Push notifications
- Payment gateways
- Push notifications
- Audio or video streaming
- Real-time features
- Personalization based on user data
- Integrations, and others.
Your mileage can vary, but the average number of hours spent on complex apps ranges from 800 to 1500+ hours.
The silver lining is that you need a profound understanding of your target audience not to overspend on app features and prioritize the right functionality. Again, an MVP kills it when brainstorming a diverse set of features.
Cost driver #4: Location
Another factor that goes into your app development costs is the location of your app development company.
It’s no secret that there’s a huge cleft among developer rates by country. Let’s have a look at the numbers:
- North America and Canada are traditionally the most well-paid tech hubs. Thus, Android or iOS development rates range from $55 to $160 per hour.
- Australia offers less expensive rates, yet keeps the bar high. Australian-based app coders price their services at $40-155 per hour.
- Next goes the United Kingdom with a median hourly salary of $70 per hour.
- South American app development rates lie in the range of $22 to $60.
- Eastern European developers’ rates present a great price-value ratio and start from $30 up to $55 per hour.
So if you want to drive down your app development costs, an offshore tech partnership can become a viable option. But you can still get away with developing an app for a few thousand dollars in the United States provided you need simple functionality.
Also, offshore software development entails both benefits and drawbacks. Therefore, make sure to shortlist reputable vendors with a demonstrated tech expertise in your niche.
Cost driver #5: Additional Costs
The right target audience and a team of rock-star developers are still not enough to win over the hearts and minds of the users.
To set up your endeavour for success, you need a winning combination of a marketing plan, financial models, and a pitch deck. All of these ingredients will grow the paycheck of the assigned specialists. Let’s have a closer look at these necessary add-ons:
1. A solid marketing plan.
Since the market is inundated with applications, you need something eye-catching to stand out. If your solution doesn’t include a unique feature, a clever marketing strategy will help you to excel. Your marketing activities will include a content marketing strategy, market research, ASO, and an ad campaign.
2. Financial model.
This business practice means building a representation of a company’s costs and profits. The ratio is then used to back up company decisions.
Therefore, along with app development costs, you also need a skilled marketing team and a few other specialists to reinforce your business idea.
Now, let’s see your game plan when it comes to evaluating your MVP costs by a specific tech vendor.
Building An MVP: Step-by-step
To get an accurate estimate for your project, go over the following pointers:
Step 1. Request a quote
Most development agencies offer their potential clients a cost calculator. Reach out to your agency and describe the app idea.
Step 2. Android vs iOS
The number of platforms also influences app development costs. Thus if you want to create a full-fledged solution for each operating system, be prepared to double prices. We recommend choosing only one platform for the MVP.
Step 3. Decide on the main features
Curate a set of features that would suffice your mobile solution.
Step 4. Choose only core functionality for your MVP
You don’t need a whole range of features to implement into your MVP. Therefore, feature prioritization will take place at this stage.
Step 5. Evaluate your main app features
Finally, your software company provides you with a total for your MVP functionality. Once your idea is validated, they will further enhance your mobile solution and infuse more features.
The Bottom Line
Your app development costs do not stem from the number of features employed or the programming languages used. Instead, the app complexity, geographical location, and the Project Management trio are what constitute the total. Associated costs like marketing campaigns also contribute to the size of the paycheck.