Lesson Six

How much does it cost to make an app?

Building a mobile app could cost between a few thousand dollars to hundreds of thousands of dollars.

To find the budget it would take to build your app idea, let’s look at a few of the main factors that impact the cost to create an app.

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1. Features

For every app, there are many features you could choose to build and each feature could be built at least a hundred different ways. One the best ways to start defining what you need to build in your app is to list your features in order of priority.

Creating a priority list of features for what needs to be built now and which features could be done in the future can be helpful when it comes to defining a budget and timeframe for your app. These priorities may change as you build but it’s a helpful way to organize what’s most important to the success of your app.

Here’s an example of an app idea broken down into features by priority:

Example app

App idea: We’re looking to design and develop an iPhone app to help people collect and share inspirational images. We imagine it as a blank space to drag and drop images from your phone’s camera and share those images with someone using a link.

Must have elements:

  • A screen to help people get started
  • A way to add images
  • A way to view a collection of images
  • Share a link to a collection of images
  • A way to edit a collection of images

Nice to have elements:

  • Show inspirational images we’ve put together and sort them into categories so people can add to their collections
  • A way for someone to create an account to keep track of multiple collections

In the case of this app idea, the most important elements—the ones needed for the product to be most useful—are included in the “Must have” list. The elements that would be nice to have or wouldn’t make or break the core function of the product, are listed in the “Nice to have” list.

Once you have a priority list of features, you can also decide what to include and what to leave out based on factors like your budget. For example, rather than building all the features you listed, you could create the first version of your product without the “Nice to have” features. This would allow you to release earlier and potentially save on development costs. It could also be useful to see how your app gets used without the “Nice to have” features to determine if the those features would even be worth building.

2. Your stage

Are you building an app to test the market or are you building an app that’s market ready? Depending on your answer, this could have a substantial impact on the cost to build your app.

If you’re building an app as a Minimum Viable Product then it’s likely this version of your app is a test to see if your app concept resonates with your target audience. The budget needed to make this type of app could be much less compared to if you were building an app that you wanted to be featured in Apple’s App Store.

Foursquare launched their first iPhone app in 2008. The app allowed you to check-in at places, leave tips, and collect points. Because the App Store was still relatively young, it was hard to know if iPhone users would gravitate toward the app.

When Foursquare released the first version of their iPhone app, it didn’t look the best and had few features:

Screenshots of first version of Foursquare in 2008 (source)

At the start, one of the reasons Foursquare likely chose to focus on fewer features was because it was more important to test if their core set of unproven features would be interesting enough to stick.

If they spent more time designing an unproven app concept and released a few months later, a large chunk of time and resources could have gone to waste.

In an interview, Foursquare co-founder Naveen Selvadurai acknowledged this approach with Foursquare’s first app,

“We made the first prototype in June 2008… I think once we launched, we realized it had staying power.”

Naveen went on to say that the game-like characteristics built-in to the app “excited a lot of people.” This was enough validation for Naveen and his co-founder to continue improving this first version.

Foursquare’s app now looks much different.

Foursquare 2014

Two years after they released the first version of their app, Foursquare worked to improve it and went on to win a Webby Award for one of the best mobile social networks. They have grown to support over 45 million members.

The creators of Foursquare wanted to first prove if people would use an app for checking in to places that was focused around a few core features, even though those features were limited and not as well-designed as they could have been. Launching earlier was more important than spending more weeks designing and developing a better first version.

Although the initial version of Foursquare didn’t look as good as it could have, it was built as a test. If you’re looking to prove a market exists or you’re still learning about the mix of features you’ll need to include in your product, than focusing too early on “nice-to-have” elements could cost you in time and money.

However, if you have a good feel for the core features your customers need, then spending time designing an experience that people enjoy, could be a much higher priority.

3. Complex, uncertain technology

Does your app have features that are technically complex or include a level of technical uncertainty? If so, this will increase the cost required to build your app.

For example, if you’re building an app that requires a search feature similar to Google’s search that’s based on complex algorithms, the cost to build this feature would be much more than building a simpler search based on keyword tags.

The budget needed to create a keyword search feature would cost much less than building a search function similar to Google.

For most features that are technically complex, it’s likely that they will require a much larger budget to build than simpler features.

3 ways to reduce the cost to build your app

1. Remove features

What features must you build now and what features could be done later? Reducing the number of features you decide to build can greatly impact the budget needed to create your app. If you realize that half of your features are “Nice to haves” and decide to do them for a future version, you could reduce the cost of creating your app by over 50 percent.

2. Reduce the depth of each feature

Every feature you want to build requires a certain level of depth. The same feature can be big or small depending on how you want it to work.

For instance, if you want people to be able to login, do you want them to be able to login with an email and password or do you also want them to be able to login with Facebook and Twitter? The difference in cost and time to build this feature would vary depending on which option you went with. If you build a login that just worked with email, this would cost less and take less time than a login that worked with email, Facebook, and Twitter.

Prioritize what’s most important for your potential customers and your business. By reducing the requirements for each feature, this can help lower the overall cost to build your app.

3. Level of design

Designing an app means creating the part of the app people will see and interact with.

While design is more than just how something looks, a designer will mainly be responsible for creating the layout of the different pages in your app, how your app’s features will look, and deciding how the different pages in your app flow together.

Depending on the level of design you aim for, your budget could vary greatly.

If you’re building a basic app as a test, this will likely require a lower level of design compared to an app that you’re looking to have market ready and be featured in an app store.

For instance, an iPhone app that uses many Apple user interface design elements will cost less than an app that has many custom designed elements.

Here’s two examples that compare Apple’s standard design elements to custom-designed ones:

Apple’s standard Calendar design vs Sunrise’s custom calendar design
Apple’s standard camera design vs Instagram’s custom camera design

If you have a Camera feature in your app and you were to use Apple’s standard Camera design in your app, this would cost less than a custom-designed Camera feature.

The cost of a custom-designed Camera could vary greatly depending on the design direction you go. Before you start, it may seem clear what needs to be designed but as you make decisions, the design evolves. Getting to a final design usually requires assessing a number of different design tradeoffs.

Some original design decisions may need to be scrapped. Some may need to be explored further. This takes time and thus, requires additional budget.

Ballpark budgets for different types of apps

If you’re building the first version of your app, the most important objective might be testing if there’s a market for what you’re building. In this case, you’d likely want to build an app that’s usable but it might be too early to optimize each screen, button, or action before proving that people actually want to use it.

Spending less time designing a more robust app because it’s a lower priority can help reduce the cost to build your app. At the same time, if you’re trying to build an app that’s ready to win a market, you’d likely want to spend more time and budget crafting the right experience.

When it comes to budgeting, there are many different options you can consider but whatever you decide to build, you should aim to meet the same level of quality across all your app’s features.

It’s much better to build an app that has one feature that functions perfectly versus building an app with ten features that all break.

You don’t want to have to start from scratch when you update your app because the first version was built poorly. In most cases, the first version of your app is a foundation. You want to lay the groundwork for future app development, not have to scratch everything and start over.

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