Hidden Costs of Building a Mobile App and How to Prevent Them

Mobile apps are highly popular in the business world. As the number of smartphone users in the US is rapidly growing, many businesses are building mobile apps to boost sales and revenue.

There is no doubt that a custom mobile app can provide a competitive edge to your business and high ROI for the years to come. However, the common question is, how much does it really cost to build a high-quality mobile app?
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Cost of Developing a Mobile App: What Studies Estimate?
Hidden Costs of Building a Mobile App
How to Prevent Hidden Costs for your Mobile App?

The key is to understand the different stages of a mobile app development lifecycle.

Many people forget that app development is not just about development or coding. It is just the tip of the iceberg.

The complete app lifecycle consists of five stages – strategy/planning, design, development, deployment, and maintenance, and each phase is crucial for success.

You see, when it comes to mobile app development, people only focus on the development cost. So, when they come to know the price of all combined stages, they’re surprised.

That’s why, in this guide, we’ll be discussing the hidden costs of an app development project and how to handle them efficiently?

But before starting, let’s see what different studies suggest about the ongoing mobile development costs.

Cost of Developing a Mobile App: What Studies Estimate?

The final cost of your app development project depends on numerous factors. Here’s what different studies have to suggest about mobile app costs:

• The development and deployment of a native mobile app can cost anywhere between $30,000 to $200,000 (Source)
• It may cost you somewhere between $5,000 to $10,000 per month for the maintenance of a medium-sized mobile application (Source)
• The development stage only represents roughly a 35% cost of the total mobile app development project. (Source)
• The yearly cost of support and maintenance of a mobile enterprise app can be up to 50% of the total development cost. (Source)

Hidden Costs of Building a Mobile App

Well, there are some essential features and services that must be included in your mobile app.

But, below are the services and features that might increase your total budget for the project app.

1. Infrastructure Services

These are basic infrastructural components that host your mobile app and facilitate the data transfer. If you want to store user information or provide certain information through your mobile app, you need a good quality infrastructure service.

Server: The server is where your mobile app is hosted, and the data is stored. If you’re developing a small or mid-sized mobile app, you can outsource hosting to third-party hosting providers such as Amazon, Azure, or Google.

Servers and data storage may cost up to $10,000 to 12,000 per year.

CDN (Content Delivery Network): If you have users all over the world, you might want to integrate your app with a CDN. Also called the Content Distribution Network, CDN is a geographically distributed network of servers that provide content to your mobile app based on the location of users.

The goal of a CDN is to provide high performance and high availability of the service. A typical CDN service might cost you around $2500 to $3500 per year.

2. Functional Services

These are the services that help you execute some critical functions in your mobile app.

The development team will build most of these features, but you might also need to subscribe to third-party services for the data delivery mechanism.

Push Notifications: These are the promotional messages that popup on the end-users’ device. Push notifications are one of the incredible mobile app features. They keep users engaged with your mobile app and encourage them to perform specific actions, such as a purchase.

You can use services like Amazon SNS, OneSignal, or Urban Airship to enable push notifications in your app.

Most of the Push Notification services are free, but if you want advanced functions, you might need to spend an additional $1000 to $1500 every year.

SMS Messaging: If you want to integrate SMS messaging or even voice calling feature in your app, you will need to subscribe for services like Twilio or Teli.net. The annual cost of these services may range from $300 to $500.

Social, Chat, or In-app Messaging: You can use these services to allow users to chat with other members. These features help you encourage the social interaction between users and improve the customer experience.

You can use services like SendBird to enable private or group chat features. The yearly cost can be up to $1200.

3. Administrative Services (Admin Panel)

App management features are vital. You don’t want to call the IT department every time you want to add or update any content in your app. Administrative services provide you more control over the data, users, and content.

To efficiently maintain your app, you need an intuitive and user-friendly dashboard. Unfortunately, the traditional app development solutions do not cover the cost of such app management features.

Also, it’s quite hard to estimate the cost of these administrative services as they largely depend on individual choices and requirements. However, most of the time, these costs will be covered in the final quote by the app development agency.

Below is a breakdown of administrative services that might add up to your annual app maintenance budget:

User Insights or Analytics: You need insightful data to promote the products or services in your app efficiently. Analytics services help you understand how users interact with your app, their behavior, different activities they perform, and much more. Based on these insights, you can make several optimizations to your app and improve the overall customer journey.

Content Management: Making changes to your app content should be easy and straightforward. You can integrate content management platforms to add, remove, or update the data in just a few clicks.

Segmentation: When you have a vast user base, you might want to classify the users based on their in-app behavior and activities. This data segmentation is helpful to send personalized push notifications and improve your sales and marketing efforts.

4. Ongoing Technical Support

Building a mobile app is an ongoing process. You will have to apply security patches, fix bugs, make changes to the app with the release of the new OS, add new features, and provide support to the users.

You might need to consider the cost of ongoing technical support while budgeting your mobile app development:

OS Updates: Google and Apple keep improving their platforms, and with every new update, they require apps to adhere to their updated guidelines. The annual cost of keeping your app updated can go up to $12,000.

API Updates: Every enterprise app uses different third-party APIs to run specific features. Any update to these APIs will add up additional maintenance costs. For example, if your app uses Facebook integration, you’ll need to update certain aspects of your app whenever Facebook updates its API. The annual cost of these updates ranges from $2000 to $5000.

Bugs: Every mobile app has bugs, sometimes they can be easily detected during testing; other times they go unnoticed for months, until someone reports. You have to fix the issues in your mobile app as soon as they are reported. Bug fixing may cost you 10% to 20% of the total development budget.

How to Prevent Hidden Costs for your Mobile App?

Does your app development budget include the costs mentioned above? If not, make sure you cover them while planning the final budget. Remember that these costs can increase with the growth of your app.

After all, you don’t want your growth to keep costing you more and more. So is there any way to prevent these costs? It really depends on the number of additional features and services you want in your app.

Here are some high-level tips that can help you prevent these hidden costs from exponentially growing while you scale up. Let’s take a look.

1. Choose Technology That Fits Product Lifespan

The technology you choose for the application project will have a long-term effect on the success of your app.

If you plan to expand your services in the future, you need to make sure that the technology and infrastructure are capable of supporting operations in heavy load. Scalability and maintenance can become challenging when dealing with the large user base.

Make sure you use flexible and robust technologies such as React Native or Flutter to scale up your app infinitely.

2. Know the Key Platform

Do you want your app accessible to every smartphone user out there? Well, it’s good to have an all-inclusive approach and capture every corner of the market, but this approach can become highly expensive over time.

For example, if your target audience is US-based users, then developing an iOS app is pretty reasonable.

Sometimes it’s smart to avoid the all-inclusive approach, especially when you’re on a limited budget. Of course, you need to do a little market research before deciding which platform to choose.

3. Don’t be Overly Dependant on Third-party Tools

You got to purchase some third-party tools or subscribe to SaaS platforms to improve the functionalities in your app.

But, don’t be overly dependant on these tools. Just because their marketing slogan tells you “easy to implement” doesn’t mean they’re that easy.

Even for implementing the SaaS solutions, you need a certain amount of planning, programming, and testing. Therefore, choose the features that directly contribute to your business bottom-line and then subscribe to third-party tools to execute those features.

Save Hidden Costs with Imaginovation’s Discovery Phase

Did you know that you can save up to 60% of these hidden costs with a reliable app development partner? We at Imaginovation aim to provide best-in-class mobile app development solutions that are highly scalable and incur no hidden costs.

We have designed an amazing customer-centric process called the “Discovery Phase,” where we set the technical foundation and tone of your project.

The Discovery Phase is an information-gathering process meant to dig deep into the details of what is essential to a client’s business, target audience, and industry.

Based on the information you provide, we formulate detailed project requirements and solidify a fixed cost estimate that outlines the timeframe and price of the overall app development.

Get in touch with us to know more about our Discovery Phase and how it can help you make big savings on your next mobile app or software project.