26 July 2018
How much do I have to pay for an app?- asked (every) customer.
I think this is the most frequent question which every Sales Manager, who works in the IT sector, and Software Developer gets. It is simple and tricky at the same time. It reminds me of the ‘hen and egg problem.’ It seems so simple but there is no unambiguous answer.
When it comes to app development, the pricing may range from 1,000. to even $1,000,000. Don’t be surprised with this huge gap. The same pricing system works in every sector. Let’s compare mobile apps to shoes ( I am a woman so it seems the most rational to me). Following this analogy, there are shoes from H&M which can cost around 10$ and there are shoes from Gucci which cost around 5 000$. H&M often creates their fashion on the basis of the latest trends from the biggest Fashion Houses. Since they may look the same, what is the difference between them? The answer is- the quality. Gucci’s shoes will be made out of luxury leather, hand-stitched or even hand-painted. H&M shoes are belt-produced which translates to their quality and overall look. The same goes for mobile applications. You may have something developed for you for 5 000 but will you be satisfied?
Below I have gathered the main variables which are responsible for app pricing:
- Features, complexity, and platform are influencing the costs of apps
- Back-end server apps will always cost more
- The simple app build from scratch starts around $20,000.
- More complex apps may require even a six figure number.
- Offshore outsourcing may be cheaper than high-end software house
- Developing an app requires a budget for updates, marketing etc.
These are the common factors which have an impact on an app pricing. Let’s have a look at it from the beginning.
The first step when developing an app is the wireframe from the client. We advise our clients to prepare wireframes ( or storyboards) with general functions and the flow of the project. The most important thing is to catch the vision of the app. What is the first thing which the user will see? When the user taps on the certain button, what will happen? This is the starting point for us. However, when the client has nothing but the idea of a project and requires wireframes from the software house, it is always followed with higher costs because the developers have to spend additional time on coming up with visions which may not be exactly what the client wants.
Other factors that impact the cost of an app are the integrations of back-end systems. When the client needs to develop a fully responsive backend system or the app needs integration with third-party vendors such as push notifications and mobile commerce, the price of app development increases.
Now let’s take into consideration three types of apps in terms of its complexity.
We can differentiate between simple, moderate and complex apps. Now, we will multiply it by the two examples of hourly rates. I will also include time for the development of the app.
|Type and description||Estimated Time||Cost at 50$ hourly rate||Cost at 100$ hourly rate|
|Simple: standard UI components, lack of API integration and backend system, simple features, templates||2 months (168 working hours in one month x2)||$16,000.00||$33,500.00|
|Moderate: Custom UI, API integration and backend system, payment system, chats, user profile, dashboard, administration panel, templates or basic design||4 -6 months||$45,000.00||$70,000.00|
|Complex: Custom UI/ UX, individual and complex backend system, Multilanguage support, 3rd party integrations, professional designs, advanced functions (videos, streaming, data storing, uploading and downloading)||7 months- 1 year||$100,000.00||$150,000.00|
The table above shows the approximate time and pricing according to the data and research made in App Development pricing. It is purely orientation purposes due to the fact that ideas and features of apps differ from each other. The factors which have been mentioned earlier in the article will influence the price as well. Outsystems carried out a survey called State of application development 2017, which shows that about 80% of mobile apps are developed within 3 months, and 40% require 6 months for development or more.
From experience, I can state that even a small app would require a team of developers in order to provide better user experience. Freelancers are also fine, but more risky.’
One person is not able to do the whole app in one month or two. And even if it is possible, it would cost much more!
A basic development team should include:
- UI/UX designer
- Project Manager
In case of more complex apps, the following developers should be added:
- 1 backend developer
- 2-3 frontend developer
- Additional UI/UX designer
- Testing team
We can also differentiate the cost of an app according to key app features which you as a client would like to include in your project. Of course, cost of the features is also fluid and depends on their design and own logic…
Here are the features which may influence the price with the estimated time for development and price ( have in mind that it depends on the developer and the number of projects he/she is involved into so the time may be shorter or longer):
- User login ( 20h; $700)
- Push notifications ( 20-200h; $1,000-$10,000)
- Navigation/ Google maps integration (10-50h; $250-$2,000)
- Geolocation ( 50h; $2,000)
- Media content ( 20h; $1,000)
- Chat or any time of message exchange ( c. 80h; $3,000)
- Ads (20h-50h; $1,000- $2,500)
- Purchases/ payment integration (30h-50h; $750- $5,000)
- Multilanguage support (10h-15h; $350-$750)
- Offline mode ( 40h; $1,500)
- Synchronization between devices ( 50h+; $2,000)
- Videos and streaming ( 30h; $1,500- $2,000)
- Database ( 30h; $1,500)
- Search engine (10h; $500)
- Data encryption/decryption ( 20h- $500-$1,000)
I don’t want to scare anybody but this list could be much longer and much complicated. I compiled only the basic features most commonly chosen by the clients and it already sounds heavy!
The next price factor is connected with choosing proper people to develop your app.
In terms of app developers, you also have a choice.
You can hire a software house, in your country or on the other side of the globe or a freelancer. As far as software agencies are concerned, we need to take into consideration that the price will be higher but the service much more adapted to your requirements. The agencies differ in standards as well but they are more reliable than freelancers. Using freelance services is fine when you want to implement some minor changes into your already developed project and there is no need for the project manager or agile app development but when the backend and frontend system is in the game, one developer is not enough.
When you’re on a budget hiring the team from abroad is a great option. The cost for one developer varies vastly between the US and e.g. Europe or Asia. At this moment Asian developers are the cheapest in the industry. What’s the catch? The language barrier, time zones and unfortunately quality are the reasons why clients don’t decide to work with a developer from the Far East. I am not trying to insult anyone, but the ratings speak for themselves in this case.
The last factor I would like to bring up which is largely forgotten by the future-app-owners is the cost of app maintenance. After your app launches the fun begins (or the horror). If the app shall have some sense of developing it, there must be downloads. Targeting the daily user activity is another factor worth taking into consideration.
Below I have compiled some basic costs for app maintenance per one month
|SERVERS (the cost of each storage gigabyte; The cost of each megabit of bandwidth; The cost of the server’s performance)
|$20-$100 per month|
|PUSH NOTIFICATIONS||$10 per month|
|PAYMENT GATEWAYS||$150 per month + fee on transactions|
|API CHARGERS FROM 3RD PARTY VENDORS||Hobbyist ($10-$20); Small Business ($90-$100); Enterprise plan ($150+)|
|FIXING OF BUGS||$40+ per month|
|EMERGENCY FIXING||Depends on the emergency|
|APP STORE FEE||Apple Store- $99; Google Play $25|
Since you have reached the end of this article I hope you have some understanding of app development pricing. Like I said at the beginning, it is not ambiguous and clear how much will the app cost. However, you need to be prepared that it is unlikely that you will pay $1,000 for an app. This is unrealistic, believe me. The apps prices start around $10,000 and go up. According to Clutch, the most reliable rating service for IT, marketing and business, the average price for app development is around $170,000.
As a client, you should understand that if you don’t have specification, wireframes, and models of your app, the time and the price of the app will be difficult to estimate and also will be higher. If you have ever prepared a documentation and wireframes for an app, you know how much time it took. Take into consideration that your development team must do this for you if you don’t provide them with details and your vision. App developers/ Programmers are similar to magicians but unfortunately, they can’t read minds. Preparing your specification will help you, your development team and your wallet in the future.
Now, do your research, save some money ( or if you don’t have the budget for your dream app, 180 Creative is in the process of preparing a guide on ‘ How to get funds for your start-up’) and develop!
Business Development Manager
e-mail address: firstname.lastname@example.org