5 Major Mobile App Budgeting Mistakes
Mobile app budgeting is a task not many companies are adequately equipped for. Despite the prominence of mobile and the number of organizations that are realizing its importance, it’s surprising how little is understood about what it takes to build a fully functional, user-ready mobile app. The result of this knowledge gap is that many underestimate – often significantly – the time, resources, and budget they require in order to build a useful product. In our experience, the biggest mobile app budgeting mistakes people make are:
- Ignoring backend development/infrastructure needs
- Misunderstanding the vast differences between apps and websites
- Failing to consider the cross-department involvement required for delivery and ongoing success
- Not enough marketing budget to promote and educate customers about the mobile app
- No plan for updates to meet customer demands after initial launch
We’re going to discuss each of these mistakes and why these areas need to be included when creating a mobile app budgeting plan. At the end of this post, you will have a more holistic understanding of the time, effort, and cost involved in creating a marketable mobile app.
Ignoring Backend Development and Service Integration
Perhaps the biggest mobile app budgeting mistake people make is assuming that it is a standalone product consisting of only the screens that users interact with on their devices. The reality is that the user-interface of the app is a very small part of a larger machine that allows the app to function.
There are a variety of moving parts: the content management system (CMS); the backend infrastructure APIs that handle business logic (cloud-based); and third party integrations (user engagement via push, analytics for data capture, Facebook login, chat, etc.). We’ll look at these in turn:
CMS: The CMS for mobile provides configuration and content services. Don’t think WordPress. Think mobile specific so you can create the best mobile experience. You don’t want to have to republish an app because of an API endpoint change or a backend maintenance window. The mobile CMS should be considered as part of the mobile app: it provides everything from settings, menu details, images and text content to the application.
Backend Infrastructure: Your app will likely need to communicate with a server to handle actions that cannot be done on-device, which includes authentication, business integrations like booking appointments or requesting updates on status, business processes, notifications and messages, and much more. While you would have considered these as core services you should really think of them from a mobile context. Your customers don’t want to wait for answers. Mobile-specific services that are highly responsive are the only true solution in today’s world.
Third-party Integrations: You don’t want to build everything from scratch so look for third parties that provide best of breed solutions for point problems. Push notifications, Analytics, Authorization, and Authentication are just a few items that should be considered.
Many make the mistake of considering only the front-end when determining a mobile app budget. By doing this, they are ignoring the largest cost factors, which typically lie within the backend infrastructure and integrations that aren’t immediately visible.
We can demonstrate this using everyone’s favorite example: Uber. First of all, Uber actually has two distinct apps. The first is what the users see that allows them to order the service, manage their accounts, etc. The second is the app the drivers use. Even if it were only a single app, the amount of backend infrastructure and integration the app requires to function would surprise many. You have the location and map components; a payment/transaction system; dynamic pricing model based on demand; and much, much more.
Just take a look at Uber’s breakdown of their tech stack (and this is only Part 1 of 2, not including the middleware or front-end components). Applications that require this kind of infrastructure are expensive to build and scale: Uber’s initial funding was 1.5 million USD, with much more capital acquired through follow-up stages.
While Uber is a complex example, it does demonstrate the many facets required for an app to work that many don’t consider when creating a mobile app budgeting plan.
Thinking Mobile Apps and Websites Aren’t Much Different
Not only do apps require the backend infrastructure, all of these different components need to be integrated and work together in order for the application to function. Ensuring that all of the moving parts – the front-end, CMS, third party services, the backend – work together seamlessly requires a lot of time and effort; much more so than a website. The more complex the project is, the more time and effort is involved; therefore the more it will cost.
Mobile apps are not websites. On the surface, this may appear obvious, but it’s important to emphasize when breaking down the technical complexity behind mobile applications and how they communicate with services and networks. There is limited real estate on a mobile screen, and the user experience is vastly different. Information needs to be more focused and content delivery needs to be faster. Mobile apps, therefore, make more network calls more frequently and require services that are able to support this.
In almost every case, the infrastructure will need to be built. Existing services that were not originally designed for mobile are inadequate. Internal and legacy systems will likely need to be recreated to support mobile.
The trap many organizations fall into is believing that their current services are good enough. They’re not.
Failing to Consider Cross-Department Involvement
The old adage “it takes a village” could not be more apt for mobile app development. Much like there is diversity in the technical components needed for an app to function, there is a need for cohesion across internal teams for the app to be successful. Development is only one part of the picture.
For a typical consumer-facing app, you will need to involve a variety of business functions: IT, engineering, marketing, sales, and any relevant stakeholders. Successful products will have an internal champion, but that person is not the only member of your team who will need to be involved.
IT and engineering will play a key role in development, integration with other services, and ensuring any changes to internal systems function correctly. Even if you have chosen an external mobile app development partner, there will be people on your team who will need to be involved.
Marketing and sales are also needed to drive user acquisition and growth, and for other tasks depending on the nature of your app. For example, if your monetization plan is based on advertising, you need to sell advertising space. If you plan on doing any in-app marketing or promotions, your marketing team will need to be involved.
While the level of involvement will vary depending on the nature of the product, its goals, and its features, cross-departmental effort, and coordination are key to the success of your mobile app.
Lack of Marketing Budget
Briefly touched on above, marketing will play a key role in driving user acquisition and growth. The app market is highly competitive, and like any other product or service, your mobile app will need to be promoted in order for it to be successful. All too often, the marketing function is an afterthought.
The cost of marketing your mobile app should be considered very early in the process when you are determining what your success metrics will be. Do you want to drive a certain amount of revenue in the first 6 months? Will you measure success by a certain number of app downloads or users in a particular timeframe? Will user engagement with the mobile app at the level you expect?
Goals are essential, but the marketing budget needs to be commensurate with these goals. If you plan to acquire 15,000 users in the first month, it is highly unlikely you can hit this target without paid promotion of the product. While you may not have exact numbers, you need to draw a line in the sand so you can benchmark, assess, and refine.
Customer Demand For Constant Updates
Continuous delivery is an important part of sustained success for any mobile app. Users are demanding, and with mobile technology evolving quickly, you can’t expect to retain and delight users with a “set it and forget it” mentality.
Having a broader mobile vision and a continuous delivery approach to development allows you to meet and exceed customer demands; drive the direction of your product; monitor, assess and improve app performance; and ultimately remain competitive.
As this is an ongoing approach, the needs to support it should be accounted when planning a budget. Again, the numbers may not be exact at the outset, but developing a longer-term strategy with a product roadmap (phased approach, roll-out plan for new features, etc.) will give you a good idea of the effort and resources required.
Know How to Budget For Your Mobile App
The five points discussed above are all highly important mobile app budgeting factors. Yet they are often completely absent when budget proposals are being created, even though they typically incur the highest cost. If you haven’t considered them, you have only budgeted for a small portion of your project, not a fully functional, sustainable mobile app.
Keep in mind that these will not all be upfront costs; you are preparing a budgeting framework that will allow you to sustain and improve your product in alignment with your overall mobile strategy. By doing this, you can mitigate risks, more realistically evaluate ROI, and remain flexible to optimize and improve your app and mobile strategy as the product matures.