Leadership Perspectives

What's The True Cost of Building and Marketing a Mobile App?

Dan Koch

Ben Stucker of Tonic Design details the true cost of building and marketing a mobile app and the risk of not establishing an effective mobile strategy.

Guest Blogger: Ben Stucker is the Director of Business Development at Tonic Design Co, an interactive design and development agency with offices in Philadelphia, PA and its close suburbs. Contact: [email protected]

I hear the same question from nearly every prospective client I speak with these days: “How much is an app going to cost me?”

On the surface, this is a logical question, isn’t it? After all, an app is just a “thing” – a little button on a phone, or tablet that can engage customers, sell them things, or lead them to the magical land of greater efficiency. Then again, an app could fail miserably, costing a company much more than the expense of design and development.

The risk of failure can often keep business leaders on the sidelines, where the only perceived way to mitigate risk is to take no action at all – but is taking no action really the safest option? Let’s look into the cost of NOT building and marketing a mobile app, or arguably worse, the cost of building a poor quality mobile app.

What are the true costs if your business does NOT build and market an app?

Brands with an online or mobile commerce site may be quick to respond that an app isn’t necessary because their conversions are up year over year. An app may be seen as a distraction or something that doesn’t need to be figured into the overall brand strategy. These can be disastrous conclusions and are contrary to a recent Gartner study that found that most “CEOs are interested in investing more than ever before, in digital marketing, e-commerce and customer experience management.”

The decision to not build and market an app means a brand forgoes the opportunity to engage directly – and in many cases emotionally – with their customers. This creates a void in any “customer experience management” strategy and, perhaps most importantly, eliminates the opportunity to collect important components of personalized data for business decision-making purposes. At a time when there are more apps available than ever before, the decision to not build and market an app increasingly opens the door for competitors who are looking to add utility to the lives of potential consumers and earn their loyalty. While these may be difficult to quantify precisely, it is clear that these costs can be significant.

What are the true costs of building and marketing a poor quality mobile app?

The risk of mobile application failure is real, and the impact on sales and loyalty can be significant. A recent study from Compuware found that 56% of users have experienced apps that don’t work properly, and when this happens they become less likely to buy and head to a competitor for the same product or service more than 30% of the time. Ouch.

So what can a business leader do if they have a “broken” app? Should they abandon it completely and forego the associated pain and scrutiny? Considering that more than $2 billion in shopping will be completed on mobile devices in 2016 and that half of the digital commerce revenue in the US will be conducted through mobile devices by 2017, the answer is clear. With so much to lose today and more-so in coming years, businesses with poor quality apps need to take the steps necessary to get back on track immediately.

Getting off on the right foot in mobile

On a basic level, consumers expect mobile applications to work quickly, consistently, and provide the features they expect when and where they need them. The goal of your mobile app should be to exceed these expectations by investing in the appropriate resources to develop and integrate your mobile strategy into your overall business goals. Outcomes from this focused effort can include forming deeper personal relationships your customers and becoming more relevant and important in customers’ daily lives by adding utility.

Author
Dan Koch

Dan Koch is TUNE's Chief Technology Officer. Previously, he was TUNE's Director of Marketing Automation, and previous to that the Director of Engineering at Artisan. Artisan is the industry’s first mobile experience management (MEM) platform, allowing businesses to analyze, manage and enhance their existing mobile applications in real-time without writing code or resubmitting to app stores. Dan is a graduate of both the University of Pennsylvania and of the Villanova University School of Business, and built systems for Best Buy and the United States Air Force in a previous life. It's been a wild ride. Pester him on LinkedIn!