Custom mobile application: development & costs

If you’re considering developing a custom mobile application (app) for your business, you might be wondering what the cost is and how the cost is arrived to when budgeting. After reading this, you should have a better understanding of not only what to budget for, but also of the variables within the cost of building the app. I hope you can be a smarter buyer to mitigate any final bill surprises!

Software Development Life Cycle

The first step in calculating the cost of a mobile app is to understand the software development life cycle (SDLC), or the steps in between an idea for an app and releasing it to your users. Most of the expense in building an app are acured by the skilled labor it takes to build it, not software licensing costs, so understanding who’s involved and what they’re doing is vital to understanding the cost.

The following is a software development life cycle visualization that Coherent Solutions uses as a guide for outlining the steps of developing an app.

Phase 1

Vision — the business case is assessed and project goals are aligned. The cost associated with developing the vision are mostly opportunity costs for time spent building consensus with stakeholders and documenting the vision; however, a consulting company can be hired to help define the vision. This phase is driven by the sponsoring business stakeholder(s) that will be paying for the app.

Requirements & Architecture — involves essentially the technical translation of the vision onto paper. This is where the functional, non-functional and architectural definitions of the system are formalized. This phase is commonly overlooked and undervalued in cost, as it takes a skilled business analyst, a UI/UX professional and a software architect for the information to be properly documented and designed. There might be more process and people involved before the development stage than one might think, but it’s better to measure twice and cut once.

The first two steps in the SDLC is what Coherent Solutions refers to as Phase 1.

Phase 2

Development –Now it’s time to write the code for the app. This phase is when the team is typically at its largest and includes oversight by the team within the Requirements & Architecture phase and brings in the developers and QA professionals. Now the project is in full production!

Acceptance & Deployment — where the system’s final testing takes place and when the app is launched to its users. This is where everything is tied together and “turned on”. This phase leverages QA professionals and DevOps engineers the most.

These two steps are what Coherent Solutions refers to as Phase 2.

Phase 3

Maintenance & Enhancement — this involves ongoing maintenance and enhancements of the system. An app is rarely fully baked after its first launch, so there are typically additional features that are added to bring more value to its users. Bug fixes also occur to ensure the app works well after its launch date.

Other professionals that you’ll need to have during the app’s entire SDLC are a project manager and a business stakeholder, whose time and opportunity costs must be accounted for.

Understanding the process and the various professionals involved throughout the SDLC helps to understand how the costs are occurred by the labor involved in building a mobile app. When assessing the cost, ask questions about how the time is spent across the phases.

Platform selection

Platform selection is a significant variable in determining the cost of the application. Your choices are basically iOS, Android, both or cross-platform technology.

It’s best to make your platform decision based on the devices that your target market uses. The best ways to figure out the most common devices is by looking at any current web or application analytics, interviewing current customers and industry experts and researching competitors’ platform choices.

Costs of developing upon iOS and Android are a lot closer than they used to be, although, Android still takes a bit longer to develop on average, which usually translates to slightly higher costs. If you decide to launch to both platforms simultaneously, you can expect to pay nearly double what you would pay to develop on a single platform. There will be some crossover that lower the cost, but you’ll pay at least 75% more to launch to both platforms.

Alternatively, a cross-platform technology can be used, like Xamarin, if you’ll be targeting both Andriod and iOS users. The use of a platform like Xamarin can reduce the overall development cost by as much as 40%. The cost savings greatly outweighs any feature or performance sacrifices by using a modern cross-platform technology.

Mobile app development costs

Now that you understand the process, the duration of resource allocation and how platform choices influence the effort, you have more context when assessing the cost. Understand your internal loaded (salary per hour + insurance + computers, etc) rate or external consulting hourly loaded rate per hour and multiply by the number of hours required for your app.

Coherent Solutions estimates that a simple mobile app would be developed in 7 weeks. A “simple” app could be described as an application with basic features typical of a mobile app without any integrations with other systems. The team composition would be 1–2 people, a developer and QA resource that perform all steps in the SDLC.

A medium complexity app takes an average of 16 weeks. This app has an average number of features typically seen on a mobile app and includes a few integrations with other systems. The team is larger and includes individuals with expertise within their specific SDLC function as outlined prior.

Enterprise-class mobile applications take an average of 26 weeks and are on par with apps that have many features and includes a lot of backend integrations performing complex tasks with a lot of data. This requires multiple experts across the SDLC that are fully dedicated to the project, especially during their step.

The cost of phase 1 can be 15% to 25% of the overall project cost. Making this investment upfront greatly mitigates costs and timeline overruns once the development phase is started. Phase 2 is the reminder of the build. Phase 3, not pictured due to the amount it can vary, is typically 25% of the initial project’s cost year over year but can be up to 50% depending on the number of platforms, integrations, and additional functionality. At Coherent Solutions, the typical floor cost is $25,000 up to a typical ceiling of $250,000.

Steps within the SDLC, duration of the SDLC, complexity levels and platform choices all compose the cost of building an app. The earlier you understand these variables, the more prepared you’ll be to understand the opportunity and explicit costs, thus helping you to budget and manage stakeholder expectations. Ask your internal teams and/or vendors what to expect within each variable before signing off on the project. Despite the chaos and pressure you may be under when being a stakeholder in such a project, do your best to account for each step in the process and then compare it project over project to optimize your spend.