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How Much Does It Cost to Build an App? (2020 Cost Calculation)

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How much does it cost to build a mobile application
How much does it cost to build an app?
Our prospective clients often start a conversation with this question. Without knowing the answer, business owners can’t decide to pursue the idea of mobile app development.
We created this article to provide you with an in-depth overview of the global software development market state. The guide will help you understand how to calculate app development cost, which factors influence it, and how to effectively manage app development cost to avoid unexpected spending in the future.

As you read, you will learn about the following points about app development cost calculation:

  • reasons to invest in app development in 2020
  • how app development cost is calculated today
  • main cost drivers of mobile app development
  • key approaches to identifying the cost to develop an app
  • cost to make an app based on the development stages

Let’s dive right into the cost calculations.

Why It’s Worth Investing in Mobile App Development

With over 3.5 billion smartphone and 1.35 billion tablet users worldwide, there is no doubt why companies see mobile app development as a lucrative industry.
People use their smartphones every minute. In fact, average Americans check their phones every 12 minutes and over 10% of people check their smartphones every four minutes. They mostly spend their time on apps. According to statistics, over 90% of mobile time users spend interacting with various apps.
App analytics firm App Annie predicts that the user base will double from 3.5 billion of app users to 6.3 billion by 2021. The total number of hours spent on mobile apps will reach 3.5 billion worldwide. Users will also start spending more money on apps. This number will reach $1,008 per user by 2021.
How Much Users Spend in Mobile Applications - 2016 vs 2021
There is no doubt that app development is a very prospective industry for investment. With more and more users, there will be more opportunities for business growth.
Now let’s find out the cost to develop an app.

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App Development Cost in 2020

So, how much does it cost to develop an app in 2020?

The median cost to develop an app ranges from $37,913 to $171,450. If we talk about complex and feature-rich applications, app development cost can reach up to $500,000 and even go beyond this number. (Clutch, 2015)
Still, how much does it cost to build an app with the simplest set of features?

The minimum app creation cost varies between $5.000-$10,000. However, the development of a working app with a sufficient number of features will probably cost more. (Clutch, 2017)

When planning for development, the app development cost is not the only factor that you need to consider. Another important metric that might greatly influence your plans is the development timeline. On average, in over 80% of cases, it takes 3+ months to develop an application. Almost 40% of apps are developed in 6 months or longer. (Outsystems Survey, 2018-2019)
As you can see, it’s impossible to give a strict answer to the ‘how much does it cost to build an app?’ question without knowing the type of app you want to create and the final set of features for the first version.
So, let’s look deeper into the processes helping to calculate the cost of developing an app.

Outsourcing vs In-House App Development

Benefits of Mobile App Development Outsourcing
Before we look further into the app development cost breakdown, you need to decide which type of development you are going to choose. You can either hire your own team of app developers or entrust the task into the hands of an experienced app development company.
When you look at the business model with an in-house dev team, you can see one main advantage – direct communication, when you can chat over app features at any time. Mobile app development outsourcing, on the other hand, is different in terms of team proximity. Still, you won’t have any problems communicating with an experienced team that has years of experience working with clients from all over the world.
When you compare an in-house team vs development outsourcing, you get the following benefits:
Pros of an in-house team:

  • proximity
  • face-to-face meetings
  • fast communication
  • deep project involvement

Cons of an in-house team:

  • lack of talent
  • need for huge initial investments

Pros of app development outsourcing:

  • huge talent pool
  • any level of expertise
  • lower rates
  • flexibility
  • no need to huge initial investments

Cons of dev outsourcing:

  • time zone differences
  • lack of personal control
Even though both approaches have their pros and cons, it is not surprising why many businesses choose to outsource mobile app development. The main reason is the lack of legal problems and tedious hiring problems, which you cannot avoid when building your own team. If you decide to go with an in-house team, the answer to the ‘How much does it cost to build an app?’ question will multiply.

What Influences the Cost to Develop an App?

There are a lot of factors that influence how much it costs to make an app. You need to understand each of them to manage your app budget better and allocate resources wisely.

Native vs. Hybrid

The cost to build an app highly depends on the type of application you decide to create using native or hybrid development technique. Native apps are those designed for a single platform, iOS or Android. Thus, if you decide to target both groups of users, you will need to build two separate apps, which will increase app development costs.
Hybrid applications, on the other hand, can work on multiple operating systems. In a big perspective, it means that you will spend less money on app development, as you need to build a single application.
However, many companies choose to build native applications, even though understanding the cost of app development of this type will be higher. They choose native applications because of their technical superiority, smooth user experience, and higher performance as compared to hybrid applications.
Cost to Develop an App: Native vs. Hybrid

Android vs iOS

If you decide to build a native app, you will need to decide which platform to target first. You have a limited budget and don’t want to risk the money, you can start with an application for a single platform, Android or iOS.
How much does it cost to build an app for iOS or Android?

The prices don’t differ much, as the timeline is almost the same for both types of development. If you have a bigger budget, you can work on two applications simultaneously and launch them to the market at the same time.

Mobile Operating Systems Market Share

Features and functionality

Knowing the answer to the question ‘How much does it cost to build an app?’ is impossible without understanding which features you are going to offer to your users. These are the biggest cost drivers, as some of them can take months to implement.
You need to be prepared that you might find that your app needs a few other features when the development has already started. That’s why it’s important to include such unexpected expenses into your budget from the start to not let such surprises throw you off the track.

Visual design complexity

The visual design of an app is no less important than its features. Building a UX and UI for your app will cost you $5,000 and up for 10-20 app screens. The cost to design an app greatly depends on the number of screens, visuals complexity, the need for custom elements, and branding.

Backend infrastructure and app administration

The majority of applications require the development of the backend infrastructure. By this term, we mean the connected APIs, analytics systems, administration panel, etc. The more such features you need, you higher will be app development cost

Location and structure of a development team

Where your development team is situated impacts the final cost to develop an app greatly. Even though there are regions like India where you can hire cheap mobile app developers, it is important to look for a good price and quality ratio.

Take a look at how much app developers charge hourly based on the region in 2020

 

Employee Title
North America
Central Europe
Eastern Europe
Latin America
South Asia
Southeast Asia
Business Analyst
$72 – $85
$50 – $80
$30 – 67
$23 – $40
$20 – $45
$25 – $35
Architect
$110 – $125
$60 – $100
$45 – $67
$45 – $75
$35 – $80
$30 – $50
Project Manager
$88 – $95
$50 – $70
$25 – $62
$41 – $68
$30 – $50
$24 – $50
Graphic Designer
$65 – $85
$55 – $70
$25 – $57
$44 – $70
$20 – $45
$24 – $50
Junior Developer
$55 – $80
$32 – $50
$22 – $31
$28 – $55
$21 – $30
$20 – $25
Middle Developer
$65 – $90
$36 – $70
$27 – $40
$27 – $60
$22 – $35
$25 – $30
Senior Developer
$78 – $125
$45 – $80
$30 – $59
$32 – $65
$25 – $50
$24 – $33
Lead Developer 
$85 – $125
$50 – $100
$35 – $65
$28 – $70
$32 – $65
$24 – $35
Junior QA
$60 – $80
$26 – $70
$18 – $30
$35 – $45
$15 – $30
$20 – $26
Senior QA
$85 – $125
$40 – $80
$34 – $55
$41 – $60
$22 – $44
$24 – $33

App maintenance costs

Knowing how much does it cost to build an app is not enough, as expenses don’t stop with app launch to the market. You need to understand ‘how much does it cost to maintain an app’ and be prepared to spend on app support

Such costs can vary from $5,000 to $10,000 annually (Clutch, 2018).

Another research shows that during the first year, 50% of the app development cost will be spent on maintenance. During the second year, you will have to spend around 25% and 15%-25% for each subsequent year (Outsystems, 2018-2019).

App maintenance includes the following types of works:

  • bug fixing and quality assurance
  • stability and performance improvements
  • code optimization
  • upgrade to the latest OS versions
  • implementation of new features
  • support of the latest version of 3rd party services.

Therefore, when you plan your budget, it is important to divide it between two major spending patterns: cost to develop an app and app maintenance cost.

How Much Does it Cost to Build an App: Calculation Techniques

App Development Cost Breakdown

You can calculate how much it will cost to build an app by yourself. The formula for app development cost breakdown is simple: the number of hours multiplied by the hourly rate. The majority of companies provide a rough mobile app development cost estimate before the development stage begins so that you know how much money you will need.

Usually, app development companies use two main charging approaches:

  • Fixed charge – this approach is mostly used for small projects that have a very strict timeline and predefined scope of work. The main advantage of this calculation technique is the clarity in app development cost. You don’t have to wonder how much does it cost to build an app, as you know the final price even before the development starts.
  • Time and material – this pricing approach differs from the first one in terms of flexibility. This is used mainly for complex projects that might have unexpected turns in the process of development. The price is usually based on hourly rate and time spent on development.

Even though you might feel anxious about this approach, it offers a lot of benefits. With the fixed price structure, you cannot change anything during development. When working within time & material frame, you are free to change the scope of work, add features or remove some even in the middle of the development process. Thus, you can build a highly customized app that your users will love.

Be sure to find out by which pricing structure the company works before you sign an agreement, as it can greatly influence the final cost to develop an app and the whole development approach.

Main Reasons why Budgets are not Met

App Creation Cost Drivers

Even though you can know the answer to the ‘how much does it cost to build an app’ even before the development starts, very often companies fail to meet the defined budgets. There are a number of hidden mobile app development cost drivers that are often overlooked.

  • Multi-platform support

Companies that decide to start native app development, often forget about the need to implement the support of other operating systems after the first version of an app is launched.

Solution: Conduct coherent market research to find which platform your target audience prefers. Plan for the first version of the app for the most popular platform. Launch the first version of your digital product to test the waters and collect customer feedback. Based on the received data, plan the development of the app for another operating system and include all the improvements from the start, thus saving money on further re-development.

  • Integration of 3rd party services

During the development, your development team can come to the conclusion that your app needs integration with some third-party API, CRM, or service. This can significantly increase the app development timeline and consequently the cost to develop an app.

Solution: When you hire an ap dev team, look for a company that offers services of mobile app architect. Such specialists will create the infrastructure of your application and will think through all integrations, even with third-party services. Thus, you won’t unexpected spending and shifts of development timeframe after you have started it.

  • Marketing costs

What expenses do you include in the question ‘How much does it cost to build an app?’

Often, businesses overlook such an important spending pattern as marketing. Even before you launch your app to the market, you need to work on its promotion. You can start warming up your audience by releasing sneak peeks of your app, working with influencers to be your beta testers, and share their experience with their audience. After the launch, the marketing battle only starts.

Here are a few channels that you can include in your marketing activities:

  • paid ads
  • content marketing and guest publications
  • SMM and email marketing
  • influencer marketing
  • Maintenance costs

Software development companies don’t include the maintenance cost into the app development price. This part is often overlooked and might create confusion. That’s why you need to be prepared that even after you launch your application, you will need to spend even more money.

App development cost usually takes only 35% of the whole budget that a company spends on app support over the next two years after its launch (Computerworld, 2012)

App Development Cost Breakdown: Stages of Development

How much does it cost to build an app

The answer to the ‘how much does it cost to build an app?’ question wouldn’t be full without the definition of development stages and costs that are spent on each of them.

In many software development companies, the app development process is divided into five stages. Depending on the vendor, the name of each stage may vary:

  • Analysis and planning
  • UX and UI design
  • Mobile app development
  • App testing and quality assurance
  • Ongoing maintenance and updates

Let’s see how each stage influences the final cost to develop an app.

  • Analysis and planning

This stage, which is also called discovery, is usually the first step in app development for many companies. According to the research by Clutch, 70% of companies start with analysis and project planning. This phase usually involves the work of business analysts, UX/UI designers, software architects and a product owner who together work on the following tasks:

  1. Thorough market research and competitor analysis
  2. Identification of potential users’ pain points and how the app can solve them
  3. Creation of the first prototypes that give app visualization
  4. Setting up all the step during app development and determining a timeline

The cost of this stage may vary from $5,000 to $25,000 and even go beyond. For the vast majority of projects, planning and analysis take 2-5 weeks.

How Much Does It Cost to Build an App: Discovery Stage
  • UX and UI design

This stage of mobile app development is fully dedicated to creating user flows, defining how users will interact with your application, and how the interface will look. This step is essential for creating a user-friendly product that will be easy to use and relevant to their expectations.

The cost to design an app starts at $5,000 and can go beyond $50,000. The price you will need to pay depends on the number of screens that should be designed and the overall complexity of your application.

Cost to Design an App
  • Mobile app development

How much does it cost to build an app? As you can see, there are a lot of influencing factors that can shift the cost to build a mobile app in either direction.

The average cost to develop an app is usually $5,000-$10,000. This cost includes the creation of the first and simplest version of an application without a backend. In most cases, companies pay $20,000-$30,000 for development.

  • App testing and deployment

The cost of building an app also includes this stage. Testing and quality assurance are essential in app development, as this phase helps to make sure that your app is ready for customers, does not have any problems, and provides impeccable user experience.

In most cases, you will have to pay $5,000-$10,000 for app testing.

App Development Cost: QA Stage

As you can see, answering the ‘how much does it cost to build an app?’ is not easy because of a lot of influencing factors. It depends on features complexity, country to which you decide to outsource, and the company you are working with. For example, a small to medium app development company in Europe can charge you $25,000 to $115,000 for app development. If you decide to work with a company in the USA, the price will be much higher – $485,000-$730,000.

Calculate Cost to Develop an App Based on Its Features

Cost to Make an App Based on Features

The average price to develop an app can shift in either direction based on the number and complexity of features that you want to implement. Some of them, like push notifications, can eat up half of your app budget and reach hundreds of thousands of dollars in implementation.

Let’s answer ‘how much does it cost to build an app?’ based on the features you are going to implement.

  • Hardware features

Those features are also called native device features, as they entail the use of device hardware. The latest smartphones have a lot of built-in capabilities, like internet connection, NFC, Bluetooth, etc. The development of such features can take a lot of time, from as little as 30 hours to 100 hours of ap development.

  • User login

This is probably the most important feature for the vast majority of modern applications. Depending on its logic and complexity, like the ability to remind a password, it might take from 10 to 70 hours to implement them.

  • User engagement

The features of this type include SMS, social media sharing, push notification, email, etc. – everything that helps you interact with users. Some features can be implemented with the help of APIs, while others need to be developed from scratch.

Depending on your requirements, it might take from 25 to 145 hours to implement such functionality.

  • Geo location

Features of this type are popular among apps, including food delivery applications, maps, and others. They can be implemented with the help of GPS and iBeacons, which will take from 10 to 150 hours of development time.

  • Payments

There are a lot of available payment gateways that you can use in your app for in-app payments, like Apple Pay, Google Pay, Stripe, PayPal, credit cards, Payoneer, etc. Depending on the complexity and customization, you might need to spend from 20 to 200 hours on such functionality.

  • Cross-device synchronization

If you create an application that can be used on iPhone and iPad, it might make sense to add a feature that would allow users to sync data between different devices. The development will take from 20 to 200 hours.

  • Data encryption

Today, data encryption is a requirement in many countries. If you don’t want to have problems with GDPR and other regulations, consider adding such functionality to your application. The development can take from 10 to 80 hours based on the used protocols, level of protection, and your personal requirements.

Here is how much companies usually pay for the implementation of some basic and flagship features:

Dev cost
Push Notifications
Ratings & Reviews
Native Integration
Web Portal
Performance Management
>$5,000
70%
71%
40%
29%
61%
$5,000-$10,000
15%
12%
28%
26%
18%
$10,000-$15,000
7%
12%
11%
16%
5%
$15,000-$25,000
6%
5%
10%
11%
13%
$25,000-$50,000
0%
0%
7%
6%
1%
$50,000-$100,000
1%
0%
1%
9%
0%
$100,000+
0%
0%
3%
3%
0%

Note: Please be aware that the above estimation is an approximation. The number of development hours highly depends on the type of app you decide to develop, features, and logic.

If you are interested in knowing ‘how much does it cost to build an app?’ of different types, take a look at the table below proving approximate examples.

App type
Features
App dev cost
Timeline
Examples
Dating app Social login/signup
User profile management
Likes and dislikes
Live chat
Notifications
Feeds		 ~$45,000 ~4-6 months Tinder, eHarmony, Woo
Audio & video streaming app Social login
User profile management
Live announcements
Broadcasts feed
Followers stats
Push and message notifications		 12% ~5-7 months Periscope, Twitch, Vimeo
Messaging app Sign up & login
Security preferences
User profile management
Auto syncing of contacts
Audit, video, location, contacts sharing
Backup creation
Notifications
Voice calling
%		 ~$70,000 ~5-8 months WhatsApp, Facebook Messenger
Social network Sign up & login
Live feed
Profile management
People search
Share photos, videos, content
Send photos, videos, content
Messaging		 ~$80,000 ~5-13 months Instagram, Facebook, LinkedIn

Note: Please remember that the above numbers are an estimation for the first version of an application. Depending on the requirements, your project might turn into ongoing development and go beyond all timelines.

App Development Cost: Summary

Now that you know how much it will cost to make an app, let’s summarize how you can avoid unexpected expenses and stick to the set timeline.

  1. Market research – before the development, conduct comprehensive market research, analyze popular apps, define the target audience, and come up with a unique idea. Don’t try to clone some popular apps.
  2. Find a reliable app development vendor – look for a company with experience in your sphere, successfully delivered projects, and find the best price and quality ratio.
  3. Start with the first app version – begin development with a simple app version having the most basic features to test your idea.
  4. Ensure ongoing development – after you have successfully tested your idea, plan for further improvements, and additional features.
  5. Get involved – be a real product owner and participate in app creation together with your development team. Provide insights, share expertise, and come up with the best solution. Because teamwork makes great work.

Want to know how much does it cost to build an app in 2020?

Get in touch with our team for a free consultation and mobile application estimation.

Contact us

Frequently Asked Questions (FAQ)

How much does it cost to build an app?

App development cost depends on a number of factors, like the country to which you outsource the work, company you work with, and set of features you are going to include.
The minimum app development cost is $5.000-$10,000. If you decide to go further, you will have to pay $38,000-$172,000 for a bigger app and $172,000+ for an app with native versions for iOS and Android.

What is the timeline to develop an app?

In 80% of cases, it takes 3+ months to develop an app. Almost 40% of all applications take 6+ months to create. The final timeline depends on the number of features and supported operating systems.

What is the cost of mobile app maintenance?

Mobile app maintenance cost vary from $5,000 to $10,000 annually. During the first year, 50% of app development cost companies spend on maintenance. You will spend around 25% and 15%-25% for each subsequent year.

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