How Much Does App Development Cost?

How much does it cost to develop an app? This question is among the first ones that are being asked when any app development projects begins. App development cost estimate is what sits at the very bottom of any mobile app development budget. Quite often a company owner finds himself trying to answer these two questions – how much does it cost to make an app for my business by hiring a professional versus how much does it cost to make an app by myself.

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As much as we would like to put a finger on a cost of app development, we can only come up with an estimate, simply because each app development process involves many factors that collectively influence a final cost. Luckily there are several app development budget forming factors that will help you to shape a development cost of an app. So an app development cost breakdown comes down to:

• App functionality and purpose – what an app will actually be capable of doing for its users.
• Mobile platforms and devices are supported – whether an app will be developed for iOS only or has an Android / Windows Mobile version as well. What specific devices will it support, e.g. iPhone 6S, iPhone 6S+, Samsung Galaxy S6 and so on.
• Integration points – will an app be integrated with third party apps that will be the source of its content.
• Use of visual objects – complexity of visual objects inside of an app will significantly influence the cost.
• Use of a smartphone hardware features – whether an app will be using such smartphone features as GPS navigation, NFC technology, motion co-processor and other technologies that are packed into smartphones or tablet computers.
• Maintenance plan – once an app development project is over, certainly it will require a technical support from its developer.

Having said that, there are some typical or average benchmarks for app development project costs that we can apply for different types of apps. For example:

• Average cost to develop an iOS app – about $28k
• Average cost to develop an Android app – about $23k
• Average cost to develop a Windows Phone app – about $18k
• Cost of Hiring a US App Developer – $107k / year

In the rest of this research we set out the available data on the development cost for apps using a range of different sources and mythologies.

App Development Cost Benchmarks

The bulk of an app development is focused on the duopoly of iOS and Android mobile operating systems and hence it makes sense to analyze app development cost for these.

The following chart presents a average value for an app development cost for iOS and Android OS back in 2012, as well as less significant but still established mobile operating systems such as Windows Mobile and Blackberry. So even though this data is five years old we can still use it as a basis to estimate a current app development cost. The cost should be definitely higher because on one hand the sophistication of iOS and Android platforms goes up and on the other – both Microsoft and Windows Mobile platforms attract way less of app developers and so a price for app development for these platforms should also go up.

The recent Microsoft decision to essentially cease Windows 10 Mobile development puts in question the platform’s future but for now we’ll continue to factor its in for the sake of providing a background for iOS and Android duopoly dominance.

Now, the iOS operating system is the most expensive one to develop for, but it does bring app developers the highest profits among all mobile app development platforms. Blackberry is the cheapest mobile platform to development for, but at the same time it’s the one that a handful developers create apps for, because its adoption is in decline for several years in a row. Currently Blackberry OS is in the lowest point of the success it had before iOS came into play in 2008.

Average cost to develop a mobile app, by operating system in 2012, in US dollars

Source: Statista

To get a spectrum as well as an average figure for how much companies claim to spend on mobile app development, let’s turn to the survey conducted by Kinvey app development platform. As we can see the ballpark of companies expenses on app development floats around $270,000 per app. The survey was conducted in 2014 among 100 Chief Information Officers from North American companies with 500 or more employees. Meanwhile the biggest segment (21%) represents companies that are willing to spend from $50k to $100k on an app development and the least (11%) – the companies that haven’t decided yet how much they would invest into an app development.

Mobile app development expenses among US-based mobile focused companies in 2014, in US dollars

Source: Kinvey

Now let’s look at what constituents to an app development cost. The recent Clutch B2B research and reviews company survey, based on data from 12 leading mobile app development companies, reveals in what proportion various stages of an app development constituent to its cost. The data presents both high and low end of the cost. Interestingly enough, infrastructure turned out to be the biggest contributor. Activities like initial setup and basic controls, data storage, third-party API integration, access to enterprise data, data encryption and scalability take the biggest part of an app development cost.

Now let’s examine how much companies spend on various stages of a mobile app development on average.

App Development Stages Cost

Having a ballpark for how much different stages of an app development may cost is what allows companies to allocate properly venture capital they manage to raise along the whole cycle of a mobile app development.

This year Clutch – B2B analytics company released a research that outlines the data collected from more than 100 app development companies to provide percentage for how much companies spend on one of the following app development stages – Discovery, Design, Development and Testing & Deployment.

So when it comes to conducting a pre-research stage 51% of companies representative said that it costs up to $5,000 to come with an initial concept and do a research. 22% went above $5k threshold and spent unto $10k and 14% spent anywhere from $10 to $25k. Clearly, compared with other app development stages, Discovery is the cheapest one.

Discovery/Pre-Research stage

Cost range less than $5,000 $5k – $10k $10k-15k $15k-25k $25k+ Percentage 51% 22% 7% 7% 13% Source: Clutch

When app development teams proceed to the Design stage, only 32% spend less than $5,000, but only 9% venture to spend over $50,000 on an app design. The majority (60%) stays within $5 – $50k.

Design stage

Cost range less than $5,000 $5k – $10k $10k-15k $15k-25k $25-50k $50k+ Percentage 32% 17% 14% 13% 16% 8% Source: Clutch

Development is the major part of the whole mobile app development process, it’s about actual coding of every feature that an is suppose to have. For only 9% of respondents the sum they spend on developing an app’s code was below $5,000, for 33% the money they spend on this stage was within $5k-10$k.

Development stage

Cost range less than $5,000 $5k – $10k $10k-20k $20k-30k $30+ Percentage 9% 33$ 25% 17% 15% Source: Clutch

It’s impossible to conceive any app development project without testing and deployment. For 32% of respondents it took less than $5,000 of their budget to do an app testing and actually deploy it on the market. Another 31% stayed within $5-$10k range and the rest went above $10k of their budget to complete Testing and Deployment stage.

Testing and Deployment stage

Cost range less than $5,000 $5k – $10k $10k-15k $15k-25k $25k+ Percentage 32% 31% 14% 12% 11% Source: Clutch

Different type of apps has a different development cost associated with it. The difference originates from the level of an app’s complexity. For example, if it has a backend server support or not, whether an app has a built-in user analytics, backend CMS support or not, if it has a built-in shopping cart or social media sharing features and so on. The graph below presents four types of an a mobile app development complexity. The price tags associated with each type of apps are approximations but they do provide you a good ballpark for each type an app development difficulty.

Cost to develop different type of a mobile app in 2015, in US dollars 

Source: Crispycodes.com

Because of a different state of economy an hourly rate for mobile app development varies in different parts of the world. On the graph below, we can see that among six regions India has the lowest rate ($10 to 50+ an hour) and US the highest one ($60 to $125 an hour), which is not a surprise at all. On the graph the Elite segment presents top professional app developers, Capable – companies with a high quality of app development and Upcoming – companies that have entered the market recently.

App development hourly rate by complexity and location in 2014

Source: Contractiq

Because an app development cost significantly depends on developers team location on one hand and necessity to consider development for both major mobile OS – iOS and Android on the other, it’s useful to stack up development hourly rate in different geographies. In North America we see Android development $18 more expensive than its iOS counterpart, in South America vise versa – Android is $9 cheaper than iOS development. In India and Indonesia both platforms are essentially equal in how much companies pay developers to create an app either for iOS or Android. UK app development pricing, as well the Eastern Europe one do not discriminate app development pricing for both platforms.

App development hourly rate by OS and location in 2015

Source: Cleveroad

App Development Cost Calculators

App industry is highly competitive, with several million mobile apps on the market, the question how to reach your target users, how to meet your ROI objectives is really tough. Businesses are eager to find the way to calculate an app development cost upfront. To meet this demand multiple online calculators were developed and we’re going to highlight only the most popular ones.

Otreva calculator 

This calculator was developed by Scranton, Pennsylvania-based Otreva mobile app development company. The calc provides stats that covers multiple platforms, app and admin features, how much does it take to build those on average, as well as average cost. It also allows to estimate the cost to develop and iOS, Android, Windows Phone or even Web app. It walks users through two steps, when users need to choose a platform and than specific features they would like to have in an app and finally provides a quote in USD.

imason calculator:

This calculator provides users with a simple three-step tutorial to explain how it works. Just like Otreva calc, this one is based on a three-step structure. On the first step users can choose between iPhone, iPad, Android Phone, Android Tablet, Windows Phone or Windows Tablet app type and on the second to choose particular features they need to get a development quote for, like Login, Social Login, Second Language support and more.

Kinvey calculator

In a contrast to two previous calculators, this one from Kinvey has more steps for users to walk through and allows to build more granular app development cost estimate. The steps are – platforms choice, internal / external team choice, will any cloud tech be used or not, size, user management, type of data to store, data sources choice, using / not using location data, third party cloud APIs usage, choice of user engagement channels and more. Once all this information is provided, users can provide their email address to get an estimate to.

Enterprise Mobile App Calculator

This calculator was developed to tackle slightly different question – how much does it cost to develop an Enterprise mobile app. It walks corporate users through multiple steps to provide an estimate. The steps are – platform, B2C / B2B / B2E, requires authentic or not, type of app (access corporate data / re-envision a business process / mobilize a new business process(s)), UA complexity, features set, using Push Notifications or not, number of corporate networks to connect to and more.

Cost of Hiring App Developer

If a company decides to hire a mobile app developer(s), the question how much does it cost comes up naturally. So according to the Indeed.com data, to hire a US-based mobile app developer companies need to pay $107,000 / year, which is $10,000 more than the number we established in January of 2016 – $97,000. After converting from a local currency to USD, we see Canada and Australia following US with $82,000 and $80,000 respectively. In countries like India it is actually way cheaper to hire an app development professional – only $4,400 a year, which is explained by the difference in North America, Europe, Australia and India economies. But of course, the services price tag shouldn’t be the ultimate decision factor for a company to hire an app development team, other information like previous clients feedback, expertise in specific technical areas and others should be factored in as well.

Mobile App Developer annual salary in 2017, by country, in USD, in thousands

Source: Indeed

The next up graph demonstrates how the salary index of both iOS and Android app developers fluctuated over time, we see it had a spike at the beginning of 2014. The spike can be explained by almost 30% growth in smartphones sales in 2014, the total number of smartphone unites sold that year reached 1,2 billion. That bump in the number of smartphones people got in their hands triggered an increase in demand for both iOS and Android OS development and hence the salary went up as well. The current iOS app developer salary in US is $98,000 / year and Android app developer is $101,000. This salary data estimated from 31,942 employees, users, and past and present job advertisements on Indeed.com in the past 12 months.

iOS vs. Android app developer annual salary in US change over time

Source: Indeed

App Maintenance Cost

Like with any software, mobile apps cost has a maintenance component. The industry average accepted cost to maintain software is roughly 15-20% of its original development cost. The maintaining process cost can be break down to the cost of hosting, monitoring, engagement, marketing, updates, and licenses.

Hosting

To calculate a mobile app backend data hosting cost you can use a calculator developed by Niko Nelissen, the VP of Mobile, Data & Engagement etouches event management software provider. It factors in such parameters as bandwidth per user, bandwidth per MAU, backend (API) requests cost and more. A cost can be calculated in both USD and euro.

Monitoring

A mobile app monitoring is really essential for its success. To monitor an app’s performance you can sign up for mobile analytics platforms we’ve listed in this guide. Because each app has its unique audience and vastly variable number of users it’s not feasible to come up even with an estimate for a mobile app monitoring cost but once you get in touch with those companies on the list, make sure you’ll get a ballpark range for your expenses this app maintenance cost constituents.

Engagement & Marketing

A mobile app marketing cost, which includes activities to engage a mobile app user base, consists of a multiple components. These are include but not limited to CPI (Cost Per Install), which is, as of October 2017, more than $1.24 per install for iOS and $1.91 for Android, a cost to acquire a loyal app user, which starts $2.78 per user for iOS, a cost to acquire a paying subscriber for apps that are based on a subscription model, which may reach $106 per subscriber.

App Updates

Every single mobile app ever released on an app store, either iOS, Android, Windows Phone or other platforms got subsequent updates released later on. On one hand it’s simply not feasible to develop a perfect app with version 1.o, from the other – subsequent updates are a great tool for a continues app user base engagement. An actual update release on an app store may take around one hour but the time that it takes to develop an update is significantly varies and depends on an app’s complexity.

Licenses

If a mobile app design incorporates one or more technologies that developer should pay a license, it may significantly increase an overall app development cost. A license fee to pay depends on annual fees to pay, number of devices and, for instance, may reach $120k / year for 50 devices.

Final Thoughts

When businesses estimate a development cost of their future app, first of all, they need to factor in a development team location and an app complexity – both factors have a great impact on an overall development cost. Given that both iOS and Android platforms have a high adoption rate, it is a smart strategy for businesses that go mobile to develop an app for both platforms simultaneously. Because infrastructure is the biggest contributor to an app development cost, it’s quite logical for companies to do their best to save on things like data storage and scalability, third-party API integration, if there are several options available to choose from.

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