The Hidden Costs of Building an App

10 min readAug 4, 2021

Sam Parry Hammond, Lead Developer and Co-Founder of Movement shares his insight into what it really costs to build an app and the factors you should consider before investing in a custom build.

While working as a freelance a web developer, I often get approached about building a “simple” app like “X”.

As someone who’s built many apps and websites for clients, I always find this funny since what they describe to me is very rarely a “simple” app.

“Oh, it’ll just be a simple app like Facebook, where my community members can chat…”
“I’m thinking it will be a basic app like Uber, but for dog walking…”
“What if it’s a simple app like SWEAT for delivering my workouts to my followers?”

On the surface, apps like these may seem simple, but only from building one do you fully appreciate just how much goes into the process.

In this article, I outline the process and only some of the key components that are often overlooked when people consider creating an app, to give you better perspective as you weigh up the decision to build your own.

Contractors

Unless you are a developer or designer yourself, you’ll need to hire someone to do the work. Hiring is a process in itself, and is often the cause of apps never seeing the light of day. You may know someone... you may know someone who knows someone... You may have to hire someone online. In any case, you need to ensure they are the right person for the job.

At the start, don’t approach developers. First, you need to fully flesh out your idea and bring it to life visually. For this, you will likely need a designer to create “wireframes”. Wireframes are a very simplified version of the app that give you an idea of the “flow” your users will take through the app.

It may be tempting to skip this step to “save money” and jump into the “real thing” but getting this right, at this stage, saves you multiples down the road. It’s a lot easier to make changes when you have drawings on paper or rough mockups than when developers are involved and code needs to be updated.

During the wireframing phase, expect to spend at least 6–10 hours to create a solid plan for the layout and functionality of the app.

For cost, considering a typical designer rate of $60 / hour, you’re likely to spend at least $360 for decent quality wireframes.

Converting wireframes to “Hi-Fi” designs

Now that you have wireframes, you’ll want to add some colour and polish to create “Hi Fidelity” designs.

Again, it may be tempting to just “make it look good” as you build. Be warned! Once developers are involved, things take more time and are more costly. The better you prepare yourself at this stage, the more payoff you’ll see in the long run.

Converting your wireframes to a polished design will take a bit of time. Expect to go back and forth with your designer at least 3 times while working through this stage–designers call these revisions. Don’t get hung up on making it perfect, as things will change when the design moves to development but you should have a clear visual style now.

This stage can take anywhere between 10–20 hours with revisions, so we will estimate 15 hours.

Estimated costs so far (on the low end):
Wireframes: $360
Hi-Fi Designs: $900

Building the App

With your designs ready, it’s time to get developers involved. Ensure you have a plan and budget in place, as this work can quickly blow out. Your designs may seem simple, but making them work is often far from it.

Apart from actually implementing the features and functionality from your designs, there will likely be many components not included in your designs. Components will likely include most, if not all, of the following:

User Authentication — Log-in, Create Account etc.
Content Management — “How do I edit this content in the future without involving a developer?”
Analytics — How do I know what’s happening in my app?
Notifications — How and when do I send notifications to my users?
Billing — How do I charge for access? How do subscriptions work? What about refunds and preventing fraud?
Delivery to App Stores — How does this app get onto the App Stores? Is it both iOS & Android? What about web? How do I make updates once it’s on the App Stores?
Support — What level of support do I provide for my users? What if things break? How do my users reach me?
Content Creation — How do I create content for my app? Is it user generated? How do I monitor & enforce fair use? Is it my own content? How will I create the content?
Additional Features — What happens when I want to add a new feature? Will I need to involve my developer?

Seems like a pretty daunting list! But I can tell you from experience, nearly every app I’ve built includes most, if not all, of this functionality.

This should also give you a better perspective as to why the cost can quickly accumulate, and you shouldn’t be surprised to see a custom app build quoted at minimum $35k, and up to $150k or well beyond. In fact, recent research (2021) by GoodFirms quoted:

the average price of a simple app is between $38,000 to $91,000. A medium complexity app cost is between $55,550 and $131,000 and a complex app may cost from $91,550 to $211,000.

Now, we’ll breakdown each hidden cost in more detail to give you greater understanding.

Hidden Cost 1: User Authentication

Nearly every app requires the concept of a “user”, and on the surface it’s fairly simple. For a developer, there are many libraries available to add this functionality, but they almost always require tweaking for your particular use case. There are additional aspects of user authentication that are often not considered:

Forgot Password
This is essential for user authentication. But, it requires you to send emails from your server, often using 3rd party services like SendGrid or AWS.
Onboarding
Often, you’ll want to capture additional information from a user when they sign up or show the functionality your app provides in a few screens. This process is called onboarding, and is typically customised to your app.
Social Sign In
What if you want users to sign in with Facebook? Google? Twitter? All of these need to be integrated into your authentication flow.
Security
On top of functionality, you want to ensure you are storing user information securely which includes setting up SSL Certificates, and ensuring you are encrypting passwords and other sensitive information.

Hidden Cost 2: Content Management

Now it’s time to fill your app with all the awesome content you laid out in the design phase, but what happens when you inevitably want to update an image or specific text? Will you need to involve your developer and pay them their hourly rate to update copy?

Alternatively, you can spend more upfront and have your developer integrate a Content Management System so you can easily edit the text and imagery. Since this adds extra complexity, expect to spend at least 33% more with a CMS included.

Lastly, if you are shipping your app to the App Stores, you may need to wait for any of your changes to be reviewed and approved before going live.

That’s a lot of work to update some text and that’s just the start.

What if you want to change layout? Add a new page? Update a link? The list goes on…

Hidden Cost 3: Analytics

This is critical to any app or website. If you don’t know what your users are doing in your app, how do you measure its success?

Plugging in basic analytics isn’t difficult with the availability of tools like Google Analytics, MixPanel etc. but it won’t be long before you want to know more:

“What do my users often do after X?”
“How does this page convert vs that one?”
“How many times was X performed compared to last week?”

Often, anything beyond simple page views will require some thought and a custom integration.

Again, this typically requires developers, which equates to more money.

Hidden Cost 4: Billing

Billing is always tricky, and very important to get right. The scope can vary vastly depending on how you plan to bill your users.

The most simple form would be a single one-off payment for access to something.

What about adding subscriptions? Again, relatively simple to setup: user makes the purchase and gets access. But, what happens when the card gets declined on the second month of billing? You app needs to keep track of that. Ideally, you want to retry the card after the initial decline, say 24 hours later. In the meantime, does the user still have access? If not, your app needs to include this functionality. It needs to know that a user’s subscription, which they purchased a month ago, has lapsed. It needs to allow them to retry, or automatically retry. If it’s automatically retrying, how many times does it retry before giving up? How is the user notified of these retries and failures?

Again, “simple” on the surface, but quickly becomes complex, and we haven’t even discussed allowing users to cancel or offering different tiers of access.

Hidden Cost 5: Delivery to App Stores

For a traditional app, you’ll need to list it on the App Stores at some point. Surprisingly, this process is often far from straightforward. Firstly, you need to ship to both Apple & Google Play Stores. These are completely different formats and are even completely different programming languages. Resultantly, it’s incredibly difficult to share code between them, so you’ll often need two developers and pay twice as much for the same app!

On top of that, if you are selling content in your app on the Apple App store, Apple takes a whopping 30% of all transactions! Your $30/month subscription? You only receive $20/month before tax. You either have to forward this cost onto users, or cop it yourself.

Oh, and Apple and Google need to approve of each update you make, which can take up to a week depending on their capacity. That’s up to one week to change some text. Can you afford it?

At Movement, this was a key factor in why we pivoted completely to a web-based platform — focusing on building a high quality app, available instantly on all platforms, with low transaction fees.

Hidden Cost 6: Support

What happens when something goes wrong in your app? What if a user is confused? What if your server goes down?

Support can take up a significant amount of time. Some users just want to chat, some users are simply never happy. Support is inevitable, and is often a source of many negative reviews if not attended to or done wrong.

You need to always be learning and listening to your users, and feeding this back into the development cycle.

Hidden Cost 7: Content Creation

We haven’t even discussed the cost of creating the content that will go into your app!

If your content is user generated, then you will need to form an initial user base to start contributing. This equates to marketing and a lot of your own time fostering the community. You will likely realise that some form of moderation functionality is required. Cue the developers again.

If the content is your own, is it video? Imagery? Audio? How are you producing this content at a high quality? Do you need to hire photographers? Videographers? Do you need to purchase a good quality microphone?

Lastly, what value do you assign to your own time? How many hours will you spend on this?

Hidden Cost 8: Additional Features

Inevitably, you will have ideas for features you want to add or change, and features you want to remove.

Depending on their scope, you may need to return to the start and involve your designer again! Then, go through development and the release.

Software is never “done”. It’s constantly evolving, and you need to be comfortable with that. Apps and websites that aren’t updated go stale, and start to look and feel dated. It’s a natural part of building software.

In Summary

It’s important to note that your costs and time will vary depending on the scope of what you are trying to build, but don’t be fooled into thinking that virtually any app concept is “simple” or cheap to build from scratch. This is not to dissuade you from pursuing app development, but I hope to make you aware of the complexity and costs that often come up. I’ve heard time and again from clients that sought a ‘cheap’ solution for their app or website, which ended up costing them more in the long run as the hidden costs slowly exposed themselves when they got further down the track.

If you are ready to pursue a branded app without all the budget, headache and development time, Movement is white-label platform that’s done the hard work and research for you. We handle all the tech, and features / functionality listed above. You simply bring the content, and make it yours with your logo, brand colour and styles.

If you don’t have your own content yet, it’s no sweat as you get access to our content library with hundreds of meals and exercises to use for free in your app. Plus, an integration with Unsplash and Pexels for all your photo needs.

Your app is instantly available on all platforms since it’s a Progressive Web App, and can be updated through a simple clean user interface. Avoiding all the costs and pain involved in doing it yourself, or going through the App Stores.