Is Building An App Really Necessary For Your Startup?

Apps are all the rage, and they have been, for a while. Clutch reported that over half of all millennial-owned businesses have an app, and nearly half (42 percent) of all small businesses have one. Accordingly, there’s some pressure to build an app for a business, social venture, or even as its own business today. This shouldn’t be done without careful consideration, though — the minimum app development price is estimated to be between $5,000 and $10,000, and it may not be fully necessary for startups who are still yet to fully prove their concept.

So, before you rush to hire a development team or build an app yourself, ask yourself these questions about your startup. Ben Lee is the CEO and co-founder of Rootstrap, a design and development studio that helps clients develop apps, websites, and other new products. He shared that “sometimes a client actually needs a website, lead generation page, or a game — not just an app because that’s what everyone else is doing.” Your initial development and budget should be spent where you’ll get the highest ROI, so these questions are worth a consideration.

1. Can Your Goals Be Achieved Through Other Mediums?

First, make sure you aren’t planning to build an app because it’s the popular thing to do. According to Lee, it begins with assessing what problem you are going to solve for your customers, and how exactly you go about that in an accessible way for them. If you solve a problem that they need solved, they won’t at all mind having to find your website to get that service. Really, apps are just another way to access that same service. So, can you help them in the same way through another medium?

“It could be a website that offers the same service, or a simple landing page could work as a vehicle to get you connected. An app is simply not always necessary,” said Lee. Think critically about what an app would offer that other mediums wouldn’t. With a strong development team, you can make just about any app-functionality work on a website, at least for the interim (and for far less of a startup cost). Of course, this means the website should also be optimized for mobile, as Statista reported that in 2019, mobile website traffic accounted for over 52 percent of all website traffic.

2. Does Your Target Customer Want An App?

Of course, one important consideration here is if your target customer even wants an app! If it’s something they’re asking for consistently, of course consider building one - taking into consideration why they want one (convenience or otherwise). But, if they don’t seem to mind using a website, then take that as a sign that it may be okay as it is. This could be a matter of the demographic of your target customer, too. The older generation is less likely to spend time on an app than the younger generation, according to insights from ComScore.

However, loyalty may also be a factor to consider here. Melanie Haselmayr wrote for AllBusiness that “With all the noise out there — roadside banners, billboards, flashing signs, newspaper ads, flyers, coupons, websites, website banners, Facebook ads, and email marketing — we slowly lose our impact on customers because of the immense amount of advertising surrounding us all.”

She went on to advise that “it’s time to go back to making a true and sincere connection with your customers, and making them a loyal lover of your product and/or service...it can be a way of staying closer to your customers, and being just a “fingertip” away at all times.”

3. What Is Your Startup Budget?

Finally, assess your startup budget and how you really want to allocate the funds available to you. If you have someone on your team working for equity who can invest the time to build the app, go for it! But if you have to outsource or hire out of house, consider what else you could spend that budget on: a prototype for your actual product, an ad campaign, or an influencer’s marketing services.

Sucharita Mulpuru, vice president and principal analyst at Forrester Research, shared with CNBC that “Apps are simply too expensive to build and maintain for most retailers.” Rather, it’s the ‘big dogs’ that seem to benefit most from apps - such as Starbucks and its payment portal. However, they have the budget to build out a comprehensive infrastructure that makes their app work so well.

Another consideration here is if you ultimately want to raise money. Venture capitalists prefer to see that you could do ‘more’ with ‘less’ - in other words, how you could make a dollar stretch. That could mean verifying your concept with a mobile-friendly website while investing some time in building a mobile app’s wireframe. But, these questions will help you get to the heart of why an app is needed (or not) — in a way you can defend in fundraising conversations or just to yourself and your team.