App and software costs are perceived as opaque and complex, and this post attempts to shine light on the inputs that change the outputs. We are here to help.

Net-net, the cost of software is mainly based on the time that it takes a team to build an app and the quality of the team — the more senior the team, the more complex the application, the higher the final cost.

Not all developers are created equal, and not all agencies run the same hourly price. At Seamgen, we pride ourselves on creating user-centric mobile and web apps with incredibly talented developers and designers. If you’re interested in contacting a premier design and development agency, check out Seamgen’s recent work portfolio here.

Below are some opinions and details about the cost of building software applications in 2017.

Pre App Cost Research

pre app cost

Applications are complex works of art. From UX design to features, every detail has to be carefully considered.

Before even looking at app cost, it is important to ask several questions:

  1. Why create an app in the first place? Seriously, learn your pitch. The why is important.
  2. What is the user demographic? You need to know who is actually going to use your app.
  3. How does the market look? Your app needs to be unique or part of a large, successful market or sub-market.
  4. What platform is it for? Some apps are only on IOS and then later get an Android version. Some apps never make it to Windows phones. Others are exclusively Android.

Once these questions have been answered, the initial cost can be estimated.

Cost Range

Due to different needs and features, the cost of creating an app can be anywhere from 5 to 7 figures. There are the features that are essential for the app to function, and then there are the extra features or integrations to enhance it. Application development takes time, so make sure the costs are justified.

Why the Disparity?

So, why the huge disparity between app development costs? Well, it can come down to how much needs to be built, how many integrations need to be created, the quality of any existing data and the type of company building the app, to name a few factors.

Developer Types and Stages

There are several variations within the development side side of the equation:

  • Freelance
  • Small agency
  • Large Agency

app cost agency

Each type of developer has pros and cons. Freelancers are generally the cheapest option, small agencies have the middle ground, and large agencies carry the largest price tag.

While the general public only sees the app once it hits the market, the actual process for it to get to market can be broken down into seven stages.

For a more detailed description of all these stages, we created an Ultimate Guide for Software Development, and we recommend you check it out.

  • Planning
    • Research and discovery
    • Scope definition
  • Design
    • Wireframe design
    • Visual design
    • User experience design
  • Features
    • Native features
    • User engagement
    • User login
    • Use of location data
    • Payments
    • Sync across devices
  • Infrastructure
    • Basic controls
    • Data storage
    • Third-party API integration
    • Access to enterprise data
    • Data encryption
    • Scalability
  • App Administration
    • Infrastructure for performance management and analytics
    • Web portal to manage application
  • Testing
    • Internal, user, and deployment testing
  • Deployment
    • Licensing

Time to Crunch Numbers

If you’re not interested in the number crunching, just look at this graphic. If you are interested in the nitty gritty numbers, we’ve included them below the graphic.

app cost

Since each stage can take a varied amount of time, estimating a cost/time formula is difficult. Clutch.co calculated the total cost with all seven stages, using a median low, median high, and maximum number of hours, with two rates: $100/hour and $150/hour.

The total estimate came out to be $25,275.00 at the cheapest end (low # of hours and $100/ hour) and $727,500.00 (maximum # of hours and $150/hour) at the most expensive end. In 2017, app cost remains relatively similar, and these estimates still provide a good proxy for design and development costs.

Here’s another graphic for those who prefer visuals.

app cost

Along with the seven stages, there are different development styles that can affect monetary costs. The most prominent styles right now are the various implementations of Agile and the more traditional approach, Waterfall.

Waterfall relies on up-front documentation and has less flexibility; it can be thought of as the precursor to Agile.

Agile, as the name suggests, is more adaptive and feedback is considered after each step. This allows for changes as the product moves along.

Spoiler Alert: Seamgen is an Agile company.

Seamgen CEO Marc Alringer lays out user-centric design in an Agile environment here. It’s a great read and can help you understand an Agile development team like Seamgen better.

Also, our VP of Business Development, Daniel Goldstein, lays out the confusion between Agile and Waterfall.

AR & VR Cost in 2017

We’ve established the basic premise of what an application development budget should be around; now, let’s look at some recent trends within the app market: augmented reality (AR) and virtual reality (VR).

Both markets have had a presence in 2016 and are only going to keep moving forward in 2017. CES 2017 showed off extreme VR in the form of fitness game/equipment Icaros, and AR had a big year with the runaway success of Pokémon Go — which recently surpassed $1 billion in revenue.

We’ll have to see if app cost changes in 2017, as agencies look to capitalize on the major AR/VR successes from 2016.

app cost

Time is Limited

We focused most of our attention on the monetary costs of app design and development. But time is another factor to always consider.

Are you willing to wait a year for your app to be ready for market? Or, are you trying to roll out your app within a matter of weeks or several months?

When working with an agency, it’s important to look at their past clients, and see what their average time frame is for similar applications.

Thanks for Reading!

You now know more about app cost in 2017. Curious about partnering with Seamgen? We can build pretty much anything. iOS, Android, Xamarin, you name it.

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