Developing a mobile app is expensive and takes time, not to mention that the results are not guaranteed. Which begs the question: is developing an app worth it? The short answer is yes. Mobile app downloads are expected to top 300 billion globally this year, a more than 20% increase from 2022. Getting even a tiny piece of that pie can drastically expand your audience and increase both business exposure and engagement.
The longer answer, of course, is more complex. While developing an app can undoubtedly be worthwhile, simply building a mediocre app and putting it in the app store is far from a guarantee for success. You'll need to have the right idea, take the right development steps, and find the right app development partner if you want users to download and actually use the app.
Get these steps right, and you're well on your way to a positive ROI. The global app market, after all, is showing no signs of slowing down.
Is Developing an App Worth It? The Hypothetical Benefits of Business Apps
It's impossible to ignore the fact that the global mobile app market is ripe with opportunity. Just as important as the 300 billion downloads this year are some of the other metrics showcasing just how beneficial business apps can be for both their developers and their users:
- Consumers in 2022 spent $167 billion on Apple and Android Apps. Adding in previous years, Apple reported that its app store alone has returned $322 billion in revenue to developers since its founding.
- Hours spent on apps designed for Android devices grew 9% between 2021 and 2022, topping 4 trillion hours this past year.
- A record 1,419 apps earned at least $10 million in revenue in 2022.
In other words, the direct revenue potential for mobile apps is immense. And that's before we even get into more intangible benefits.
Consider, for example, the brand awareness and visibility benefits of a well-designed app. App store optimization can ensure that your app gets thousands of eyeballs every day, especially if it solves a core audience need or pain point. This combination of tangible and intangible benefits clearly answers the question of whether developing an app is worth it.
The Cost-Benefit Equation: Determining Whether Developing Your App Will be Worthwhile
The potential benefits of mobile apps, in general, are only part of the answer. If you truly want to know the value of app development, you also have to take the cost of that development into consideration.
That cost, of course, can quickly and drastically diverge depending on your needs and the partner you work with. One research project that set out to find reliable average app development costs established these benchmarks, which continue to be a good guiding tool for determining app building costs:
- The price tag for developing a simple app with core functionality and a straightforward interface is between $16,000 and $32,000.
- The price tag for developing a medium-complexity app with diverse functionality ranges between $32,000 and $48,000.
- The price tag for developing a highly complex app with a wide range of functions and audiences serve reaches above $72,000, and sometimes above $100,000.
Other factors, of course, also play into that equation. For example, hiring an offshore developer may be cheaper, but the end product may not be high-value enough to drive positive returns. Similarly, an app company that follows a waterfall development process may be less pricey at first, but multiply in cost if the end product does not work as intended and the development process needs to start again from the beginning.
Related: How We Work and Why We Choose Agile
The key, then, is building a cost-benefit analysis that helps you understand how much value you can gain above the costs required to develop the app. That value can be both tangible (the revenue gained through the app) and intangible (the branding benefits gained through the app). A simple cost-benefit analysis template can help to get you started.
How Does the Type of App You're Building Play Into Potential ROI?
The fact that not all apps are created equal also matters when it comes to the type of software being developed. The same report determining 2022 app revenue and consumer spend also broke down that revenue by subgenre, and the results are telling:
- Entertainment apps accounted for 16% of consumer spending.
- Social media and dating apps accounted for 13% of consumer spending.
- Video-sharing apps accounted for a combined 12.4% of consumer spending.
- Music and audio apps accounted for 4.2% of consumer spending.
- Photo editing apps accounted for 1.8% of consumer spending.
- Business software apps accounted for 1.6% of consumer spending.
- Fitness apps accounted for 1.4% of consumer spending.
- Productivity apps accounted for 1.0% of consumer spending.
Once again, of course, the question of whether developing an app is worth it depends on more than just this figure. Even if the app itself isn't responsible for generating that revenue, it can still play a crucial indirect part in the same equation.
For example, finance apps don't appear in the above list, but receive more than 1 trillion uses in the average year. A comprehensive cost-benefit analysis can help you determine that potential ROI; the next step is taking care to make sure the software you create will be worth your investment.
5 Steps to Ensure Good App Development
So far, the question of whether developing your app will be worth the investment has been largely hypothetical and based on general numbers and principles. Of course, that's only part of the equation. Ultimately, the success and potential positive ROI of your app has to come down to various steps in the development process.
More specifically, five steps in the development process can help you maximize your chances of a positive ROI:
- A Great Idea
- The Right Partner
- A Collaborative Process
- A Prototype or MVP
- Continuous Improvement After Launch
Next, we'll discuss each of these steps in more detail.
Step #1: Finding the Right Idea for an ROI-Positive App
The right mobile app is far more than just a duplication or extension of your website. To bring in a positive ROI, it has to follow a few core principles that maximize its chances of success:
- The app has to fill a core need for your audience that direct competition like other apps or in-direct competition like non-app solutions cannot easily solve for them.
- The app needs to align with your business, either building on your brand's value proposition or extending that value position in a natural, intuitive way.
- The app's core concept needs to be easy to understand for audiences who might not yet be familiar with its core functionality.
An idea and concept that doesn't follow all of these principles risks becoming one of the millions of apps receiving few to no downloads. That might mean having to refine your idea before moving forward, but spending the extra time on this step now will pay off later.
Step #2: Choosing the Right App Development Partner
It's not an exaggeration to say that the success or failure of your app depends entirely on the partner you choose to work with. Their experience and core competency, as well as their willingness to suggest improvements or alternative routes, can make all the difference as you look to make your app ROI positive.
Take the time you need to find that partner. Do your research, and look at all project case studies that can tell you more about their process and philosophy. Only choose a partner once you're sure their development philosophy and pricing align with your needs and goals.
Transparency is key, and beware of any company that says the app they build you won’t require maintenance. All apps need maintaining because there are constant changes in user preferences, competitor apps, and technology capabilities. You want your app to be properly maintained so the app continues to be of value for the user.
Step #3: A Collaborative App Development Process
Don't think of your app development journey as a straight road. You'll be almost guaranteed to encounter unexpected bumps in the road that you'll need to navigate. For example, a prototype might not test nearly as well with your audience as anticipated, requiring potentially significant adjustments.
To ensure you can account for these unexpected bumps, you need a development process that prioritizes collaboration. Lines of communication between client and developer should always remain open, with transparency a core tenet as both parties work toward an app that will be worth its investment.
Step #4: A Great User Experience and Interface
When it comes to mobile apps, inner beauty matters—but only outer beauty can allow it to come out. In other words, even the best functionality matters little if it's hidden by a less-than-ideal user experience and interface.
That means prioritizing your navigation and copy as you develop the app. User paths and help sections should not be an afterthought. Only a simultaneous focus on UX and UI can maximize your chances of creating an app your users will love to use.
Step #5: Continuous Improvement to Optimize Your App Over Time
The best and most lucrative apps on the app stores all have one thing in common: they're never finished products. The initial launch is not the endpoint, but a starting point to continue optimizing the app over time.
Initial downloads and usage statistics are not just indicative of return on investment, but also crucial key performance indicators to determine where improvements might be needed. Bug reports are another opportunity for fixes. New features might help to improve the app over time. A successful app requires a long-term strategy to continue improving it over time—this has to be part of the equation.
Make Your App Worth Developing with the Right Partner
Statistics unequivocally back up the value of app development. But simply building that app is far from a success or revenue guarantee. Instead, you have to be strategic in that development process. The good news: the right app development partner can help to guide you through all of those strategic steps and milestones.
Let's get started on that process. As an NYC-based app developer, our team at Milo Mobile prides itself on not just coding expertise but also expert experience in a collaborative app development process designed to delight your audience. Ready to learn more? Contact us to start the conversation.
