What budget do I need to build my application?
You are preparing to develop a new application, and you ask yourself: How much do I have to invest in app development? I will answer how much you have to invest in creating an application and tell you why it is not worth investing too much! Finally, I will also share with you a ready-to-download checklist that can help you estimate your budget.
Regardless of whether it is a mobile application or a web application, you should try to maximize the budget used and minimize the risk of failure. I will tell you about 3 essential things that affect the project budget. You should consider them before starting your app development.
1: Why do you want to create a new application?
The first crucial thing is to answer a seemingly straightforward question: Why do I want to create an application or other solution? Probably the answer is quite simple, but it is worth asking yourself this question. You have to remember that a digital product is not created just to be there, but to fulfill its specific task related to the business goal you want to achieve and to meet the needs of end-users who will use it.
2: Remember who you create your application for
You must understand that the so-called early adopter will use your application in version 1.0. These are the users most interested in using your application. Before everyone in the world starts using your product and it becomes a standard (which I sincerely wish you), early adopters will be the first ones that your application will reach.
Early adopters are not only the first users of your application, but also an invaluable source of knowledge about the market for which you create the product and about the product itself. Remember to collect feedback from early adopters, listen to them and draw conclusions. Thanks to it, version 2.0, 3.0 of your application will be better and better, and it will be more comfortable and easier for you to reach a wider audience with your product.
3: What should be in the 1.0 version of your product?
The first important thing I mentioned above is defining the business goal you want to achieve after the 1.0 release. Imagine that you have successfully created and made available the first version of your application. What has to happen for you to say: "Ok, we are doing great with version 2.0, we add new functionalities, develop and polish the current functionalities!" The answer to this question is hidden in the business goal you set by yourself. (Now you can see why it's so important, right?) It will make it easier for you to determine what should be in version 1.0 of your product. Defining these initial functionalities needed to achieve a business goal is called a minimal feature set. A feature set is a set of functionalities that not only supports the achievement of a business goal but, importantly, solves the problems of end-users so that they will want to start using your product.
And that's precisely what the MINIMUM you should focus on. No more, no less. Any additional functionality, or any functionality that is larger and more extensive, will probably distance you from achieving this goal. I know that such a departure works and brings the expected results. When we managed to convince the client to start working from something small without spending the entire available budget, we usually manage to achieve what was assumed step by step, so that both the client and the end-user would get what they wanted. Testing the first versions of the products that we developed together with our clients by early adapters made the client come back to us with ideas that he had not even thought about earlier. Only the feedback from early adapters allows you to indicate the right direction of your product development.
You already know 3 factors that should be taken into account before developing your application, and you know that they impact your production budget. Only one question remains:
So what should the budget be?
The answer is not so simple. Based on our many years of experience in Leaware, we have created a framework in which we propose what the budget should be. The budget in general can be: too small, too big, or appropriate (accurate). What does it mean?
The budget is too small
If the budget is too small, we will have a small, negligible impact on achieving the first business goal and the functionalities that we will provide to users won't interest them enough to make them want to use the product.
Let me give you an example that illustrates this perfectly. Imagine that we are creating an application that has a login screen. If this is the only functionality of this application, then probably nobody will want to use it, right?
The budget is too big
If the budget is too big, then there are many functionalities in the application. Many functionalities mean longer work on building the solution, longer development. During this time, users do not use our application, so we do not collect valuable feedback, and we do not know if we are developing the product in the direction desired by the market. Thus, the risk that the product we are working on is not precisely tailored to users' needs increases.
The budget is accurate
It is a compromise between the fact that we can achieve the goal, users get enough value to want to use the application and provide us with valuable feedback. Thus, we minimize the risk that we do things together with the client that will eventually be disconnected from the application anyway because they will not respond to the users' needs.
How to determine the right budget?
It is always our initiative; we estimate the budget based on our experience of the projects we have implemented so far, the fact that we have products that we develop, that exist on the market, and the fact that we have extensive experience in cooperation with startups from all over the world. Thanks to this, we understand well our clients' challenges, and we know how to help them meet those challenges.
Together with the client, we decide what should be included in the project budget. We make decisions based on all factors mentioned above.
You can imagine it in such a way that based on what you want to do, what business goal you want to achieve, who is your target group and what user problems you want to solve - we offer you a box method, which is presented below.
We put into this rectangle the functionalities necessary to achieve your application's first business goal. We fill the box together, trying to obtain a minimum set of functionalities (feature set). If it turns out that the budget is too small, e.g. our box is too small, we can always enlarge it, but we try not to do it from the beginning. It is better to do less, take feedback from the market, and in subsequent interactions (following versions) add new functionalities than, as I mentioned earlier, start with a box that is too large and then remove functionalities or change them because the feedback from users is such that functionalities do not meet their needs.
In conclusion, when planning your budget, remember to:
define the first business goal you want to achieve after launching your application on the market
pay attention to who your audience is: who your users are and what problems you want to help them solve
put in version 1.0 of your product a minimum set of functionalities, which will firstly help you achieve the business goal defined in step 1. Secondly, it will be sufficient for your product's first users (early adopters) to want to use it
set the right budget that cannot be too small or too big. Only the right budget will allow you to minimize the risk of failure.
Finally, as I promised, I am sharing with you a useful, ready-to-download checklist that will help you check what budget you need to build your application! Best of luck!