By Annie Ellicott

Many of my clients are asking “shouldn’t we be building a mobile application”?

New 2015 research from Localytics highlights the high attrition rate of new users for apps. The Localytics survey results showed that 58 percent of users “churn,” or become inactive, in the first 30 days after they download an app. By month 3, the attrition rate jumped to 75%. The sweet spot for making new users “sticky” appears to be 3 uses in the first month after download. Users who reach or exceed this hurdle tend to continue as active users longer term.

Mobile apps can be expensive to develop and are not for every business. Many are used to increase loyalty among existing customers and thus are particularly good for customer retention but are not necessarily effective for customer acquisition. And mobile apps also tend to be highly functional in purpose and/or leverage smartphone assets such as GPS and locational tracking. So how should you decide if making an investment in the development of a mobile app makes sense for your business?

Here are a few important questions you should ask yourself before deciding to build your own app:

What are your objectives?

Mobile apps are ideal for situations where consumers need rapid access to unique functionality, “on the fly”, repeatedly. Think trip reservations/notifications (Tripit), content publishers where you “follow” a stream of changing news (sports events), e-commerce (Amazon) or task/contact organization (Evernote, Highrise, Exec).  Mobile functionality is also allowing consumers to leap ahead avoiding paper signatures (Signeasy) and access to files stored in the cloud (Dropbox, Box). Many apps are highly utilitarian in concept and in function.

A second consideration is “Can you extend your value proposition by creating an additionally compelling mobile experience through an app?”. Think gaming (mobile vs desktop version) or similar brand-extensions which support a parent property.

A third opportunity is proprietary content. Mobile apps are ideal for situations in which you can deliver proprietary content via a mobile gateway. Think databases, catalogs for niche verticals.

What is your budget?

While the number of outsourced solutions to app development are increasing (JamPot’s “TheAppBuilder” for example), the cost of an app can vary from a few thousand dollars to a few hundred thousand depending on the complexity and subsystem interfaces. Your budget will have to cover not only the creative/programming (development costs) but also the maintenance/upgrade costs and the developer registration fees from Android, Apple platforms. And you will have to develop separate apps by platform. What works on Android does not work for the iphone. And then, there’s the marketing budget…

How will you get the word out about your app?

If your app is primarily a solution for existing customers (a value-add), then getting the word out to your target market will be quick and relatively affordable. Apps that need reach however, will have to pay for this. Depending on your business model, you may need to consider how you will recoup the costs of app development and marketing.

Think you’re ready for an app? Call us and we can help you develop an effective build and launch plan. Let’s go!