The $100,000 App Question: Are Custom Business Apps Worth It?

The $100,000 App Question: Are Custom Business Apps Worth It?

Table of Contents

The Debate: Are Custom Apps Crucial to Businesses?

Explore the role of custom apps in business growth from 2016 to 2020. Discover why investing in app development could be pivotal or futile for your business. Crucial tips, insights, and debates.

 

Want to know if creating a custom app is worth it for your business? Dive into our discussion for an expert take on app development from 2016–2020. Let’s talk tech!

Are Custom Business Apps Worth It?

  • Intro
  • Apps for Small Businesses
  • Building Useful Apps
  • Websites in the 90s
  • Current App Building Trend

 

One of the hot debates in the modern tech-savvy business world revolves around the relevance and importance of custom apps to businesses. But how crucial are these apps to your business? Let’s dive into that!

 

TL;DR

Article Overview

  • Discusses if custom business apps are crucial for companies from 2016-2020
  • Looks at pros/cons and challenges with investing in custom mobile apps
  • Author likens current app building trend to websites in the 1990s
  • Concludes most smaller companies should not build apps due to high costs

 

Key Takeaways

  • Building effective consumer apps requires substantial resources and is very difficult
  • Custom apps can provide competitive advantage, but the right execution is rare
  • Author predicts growth of poor quality, low demand business apps
  • Evaluating if an app solves core problems better than a website is key
  • Recommends only 3% of businesses build apps due to unfavourable cost-benefit ratio

 

Conclusion

  • Custom apps are pivotal for select businesses with specialized needs and capabilities
  • But for most SMBs, costs outweigh potential benefits so are not worth pursuing
  • Each company should carefully assess if an app aligns to overall growth strategy

 

Examples Given

  • Fortune 500s may fail at building apps despite resources
  • A small lobster stand likely derives little value from an app
  • Websites in 1990s did not provide ROI for many companies

 

Guidance Provided

  • Building apps just because competitors have them is ill-advised
  • Carefully evaluate target users’ tech usage and mobile needs
  • Prioritise apps that solve defined problems over nice-to-haves

 

Estimated reading time: 16 minutes, 10 seconds. Contains 3236 words

 

What’s the Big Question?

“Are custom apps now, or are they becoming more essential to companies?” This was a question posed by Matthew during one of our interactive Q&A sessions. The question piqued my curiosity and nudged me into an intense intellectual standoff with myself. As business trends evolve, it’s crucial to reassess traditional beliefs and adapt to new developments for continued growth and success.

 

The Verdict

Before hopping straight to my conclusion, I’d like to remind you that running a business is a unique journey, and what could turn out to be extremely beneficial for one business may not necessarily hold the same promise for another. With that being said, my take on this would be a blended yes and no.

Yes, if you run a business today and flaunt the flair to create an amazing application that users will love and find value in from 2016 to 2020 and beyond. However, I also believe that such a crucial combination of the right business, team, idea, and execution is a rare sight. Even globally recognised Fortune 500 companies might stumble when it comes to designing a consumer-grade application.

Take, for instance, “Rick’s lobster roll stand” in St. Louis, Missouri. The path to building a successful, value-oriented application is strewn with monumental challenges—financial, logistical, technical, you name it.

 

The Challenges

Building an effective consumer app demands a significant commitment of resources. It’s a time-intensive and cash-draining operation. Even applications that appear to be strictly utility-oriented, like banking applications, cannot reach the apex of success as one might anticipate. Believe me when I say it’s really, really difficult. My advice to approximately 97% of readers would be to resist the temptation of building an app for their business. The returns are unlikely to justify the investment, resulting in an unfavourable cost-value ratio.

To elucidate further, here’s an analogy:

“The situation is somewhat reminiscent of the web era around 1996–1998, when businesses were engrossed in developing websites. They shelled out between $5,000 and $100,000 on website development, only to find that their sites didn’t garner substantial value due to subpar quality, a lack of customer demand, or both.”

 

The Future Landscape

Fast forward to today, and I see a similar trend unfolding, but with a higher stake: the building of applications. Especially among small to mid-sized enterprises, there seems to be an inexorable surge towards app development, and not necessarily for the better! Therefore, it is necessary for businesses to question whether building a custom app is the right way ahead. For many, the answer might be a solid no, but for a few, it can be a route to a pivotal market positioning.

Always let your business requirements, resources and growth strategy drive this decision. Do not just try to pick these choices because they are ‘in.’

 

Takeaway!

Are Custom Apps Crucial to Businesses?

The author sees custom apps as a critical business tool over 2016–2020 for those with the skills to create effective ones. However, he believes very few companies, even Fortune 500 ones, have these capabilities. Consequently, most businesses, particularly small to midsized ones, should not invest in app building due to the high costs and substantial resources it demands. The author likens the current trend in app development to a late 1990s period where many businesses wasted funds on ineffective websites. He predicts the growth of non-valuable business apps that lack demand.

 
This is a guest post by Gary Vee.
 
 
Resources:

[1] https://kissflow.com/application-development/custom-application-development-guide/

[2] https://itechnolabs.ca/the-complete-guide-to-custom-app-development-process/

[3] https://powerapps.microsoft.com/en-us/tips-for-mobile-app-development/

[4] https://www.valuecoders.com/blog/technology-and-apps/11-tips-successful-mobile-app-development-businesses-android-ios/

[5] https://www.fatbit.com/fab/custom-mobile-app-development-guide/

 

FAQ:

 

What is custom business application?

A custom business application is software that is specifically designed and developed to meet the unique needs and workflows of a particular business or organization. Unlike off-the-shelf software, custom applications are tailored to the client’s specific requirements.

 

Why would you need to create a custom application?

There are several reasons a business might need a custom application:

  • Existing software doesn’t meet the business’s unique needs or workflows
  • Want software capabilities tailored to the business
  • Current systems are outdated and need modernization
  • Need to integrate multiple systems into one unified application
  • Require additional features not found in off-the-shelf software
  • Have niche industry needs not addressed by generic solutions
  • Seeking a competitive advantage with proprietary processes

The bottom line – if your business has processes that generic software can’t adequately handle, custom development is the way to go.

 

Can I create an app for my business?

Absolutely! With some technical know-how or the help of an app development firm, any business can have their own custom mobile app created. Reasons to create a business app include:

  • Increase brand awareness and visibility
  • Enable mobile access to your products/services
  • Provide a better customer experience
  • Improve employee productivity with business tools
  • Streamline operations and cut costs
  • Generate additional revenue streams

So don’t be intimidated. Whether you need an app for ecommerce, scheduling, inventory, payroll, CRM, or something unique to your operations, it is possible.

 

How do I make a custom app?

The main steps are:

  1. Clearly define app goals and target users
  2. Create detailed app specifications and wireframes
  3. Hire a developer and/or use an app builder platform
  4. Choose underlying tech – native iOS/Android or cross-platform
  5. Code front-end visual interface and back-end database/logic
  6. Rigorously test on devices and fix bugs
  7. Submit to app stores for publication
  8. Market and update app continually

It’s complex but worth it. Many non-coders can use app builders like Appy Pie, BuildFire, or AppInstitute to simplify parts of the process.

 

Can I create my own app for free?

It depends. You can utilize free app building platforms like AppyPie, AppMakr, or BuildFire to create fairly basic apps without coding for no cost. Features will be limited compared to hiring developers though, and you still need to pay for licensing and app store distribution.

For more complex apps with custom programming required, you’ll need to either learn development yourself or hire a professional agency/freelancers. So “free” doesn’t really apply. However, many will work on deferred payment models, taking a percentage of revenue after launch rather than upfront – thus removing barriers for early stage startups with great ideas but limited funding.

 

How much does it cost to build an app yourself and how much does it cost to have someone create an app for your business?

If you build the app yourself, costs are mainly your time investment to learn programming + nominal fees for computer equipment, developer accounts, licensing, etc which could range from $200-1000+.

Hiring an agency generally costs $5000 to $150,000+. According to GoodFirms, average cost breakdowns are:

  • Simple app – $5000-$40000
  • Medium complexity – $40000-$70000
  • High complexity – $70000-$150000+

The exact price depends on features, integrations, security needs, custom visuals, and more. Many provide free quotes for scoping projects based on requirements and ongoing maintenance also required.

 

Is it still profitable to make an app?

Absolutely – the app economy is booming.

According to BuildFire, 80% of time on mobile devices is spent using apps. Statista predicts almost $700 billion in global mobile app revenues by 2025.

While competition has increased, innovative apps solving business pain points or creating engaging user experiences still have plenty of profit potential. Add revenue streams via paid downloads, in-app purchases, advertising, and business partnerships.

 

Do you need a license to publish an app?

To legally publish any app you develop, you need developer accounts with the major mobile app stores:

  • Apple App Store – $99/year
  • Google Play – $25 one-time fee

These accounts allow you to distribute apps to users while complying with platform policies. Many app builders include marketplace distribution with their plans or bundles. So licensing needs depend on how the app is built.

 

Can I make an app and sell it?

Absolutely! After obtaining the necessary licensing, you can monetize your app in several ways:

  • Paid downloads – Set a price to purchase your app
  • In-app purchases – Sell premium features, virtual goods, etc.
  • Subscriptions for ongoing access
  • Advertising revenue from integrated ads
  • Enterprise licensing for custom white-label versions

The key is building an app people want and making the benefits clear. Market aggressively across app stores, social media, and your own website to maximize sales.

 

When should I create an app for my business?

The best time to create a business app is when you notice mobile-focused competitors gaining advantage, need to improve customer service, want to reach new demographics, are launching innovative product ideas in the digital space, or have any other strategic mobile initiatives on your roadmap. Prioritizing apps aligned to core business goals leads to greatest returns on investment long term.

 

Should a business have an app?

Not necessarily – having an app just for the sake of it won’t inherently improve operations or profitability. Key considerations include target customer tech usage, mobile reliant offerings, need for mobile productivity, and ability to support an app post-launch. Evaluate if an app solves defined problems better than responsive web experiences, digitizes analog processes, or enhances customer experience in ways a website cannot. If major value-add is apparent, investing in an app could make sense.

 

How many apps does a business use?

Most businesses use 2-4 key apps for core functions like operations, sales, marketing, HR, finance, productivity etc integrated into workflows. Large enterprises depend on many more – 15+ apps integrated across departments (too many disparate apps can create inefficiencies though). Evaluating integration capabilities and keeping the stack lean optimizes mobility.

 

What are the best apps for businesses in general?

Top apps used by many businesses include:

  • Email and Calendar – Gmail, Outlook, Office 365
  • Cloud Storage – Google Drive, Dropbox, OneDrive
  • Video Conferencing – Zoom, Skype, GoToMeeting
  • Team Chat – Slack, Teams, Google Chat
  • Project Management – Asana, Trello, Basecamp
  • CRM – Salesforce, HubSpot, Zoho
  • Accounting – QuickBooks, Xero, Sage

Best mix depends on company size, industry, budget and specific needs.

 

What is the most important Google app for businesses?

The most vital Google app for businesses is Gmail – over 1.5 billion users makes it the world’s most popular email service. Benefits include:

  • Integrates essential companion apps like Calendar, Drive, Docs
  • 15GB free storage
  • Custom email @yourcompany.com
  • Reliable spam filtering
  • Easy collaboration
  • Access from any device
  • Enterprise-grade security

Gmail with G Suite provides robust productivity and collaboration tools for organizations of all sizes to communicate and manage operations efficiently in one place.

 

What apps can I use to find a business partner?

Top apps to connect with potential business partners include:

  • LinkedIn – World’s largest professional network
  • Upwork – Freelancers for hire
  • AngelList – Startup investing community
  • Bizness Apps – Meet local business owners
  • Partnerize – Affiliate marketing partners
  • JVZoo – JV deal marketplace
  • Startups.co – Co-founder dating

Use advanced filters and saved searches to zero in on relevant profiles across these networks.

 

What payment app should I use for my small business?

Best payment apps and processors for small businesses are:

  • Square – All-in-one POS, great for retail stores
  • PayPal – Most widely used online payment method
  • Venmo – Peer-to-peer payments owned by PayPal
  • Stripe – Coded payments for ecommerce
  • QuickBooks Payments – Seamless accounting integration

Evaluate fees, flexibility, integrations, analytics, and features to match the right platform to your business model.

 

Can anyone create their own app?

Yes! While coding skills help tremendously, even non-developers can utilize app building platforms to create and launch mobile apps now with little or no technical knowledge. Services like Appy Pie, BuildFire, AppInstitute, and more allow creating apps via drag-and-drop interfaces and templates for much faster development. So if you have a great idea and vision for an app, there are more options than ever to make it a reality on your own today.

 

How do you make money by creating an app?

Popular mobile app monetization models include:

  • Paid Downloads – Upfront cost to download app
  • In-App Purchases – Sell premium features, virtual goods
  • Subscriptions – Offer ongoing access for a fee
  • Advertising – Display ads and commercial partnerships
  • Freemium – Free app with paid upgrades
  • Enterprise Licensing – Develop white-label versions

Additional options are transaction fees, affiliate marketing, and sponsored content. Evaluate your audience, market, and business goals to choose the best revenue streams.

 

How to code an app?

Main steps for coding a mobile app:

  1. Learn a language – Swift (iOS) and/or Java (Android)
  2. Design app architecture and plan features
  3. Code back-end data and logic
  4. Build graphical user interface (GUI) front-end
  5. Connect interface to back-end databases
  6. Rigorously test on emulators and real devices
  7. Fix bugs and optimize performance
  8. Deploy to app stores

Focus on mastering key concepts like variables, data structures, operators, OOP, APIs, databases, version control, authentication, caching, security, etc. Many expert developers use frameworks like React Native for efficient cross-platform development.

 

Can I create an app with Shopify?

Yes! Shopify offers several options for creating mobile apps:

  • Shopify Mobile App Builder – Drag-and-drop app creator
  • Shopify POS – iPad/iPhone point of sale app
  • Shopify APIs and SDKs – Build custom native apps
  • Shopify App Store Partners – Leverage proven third-party apps

So whether launching an ecommerce store or building brick-and-mortar retail presence, Shopify has robust tools to build mobile apps tailored to your business.

 

How to make an app without coding in 2024?

Even non-coders can make full-featured apps themselves in 2024 using these innovative no-code platforms:

  • Appy Pie – Robust app builder for apps and games
  • Thunkable – Build native Android/iOS apps with visual workflow
  • Bubble – Create complex web apps via drag-and-drop
  • AppSheet – Turn spreadsheets into mobile apps
  • Bravo Studio – Voice app creator for Alexa/Google Assistant
  • AppInstitute – Apps tailored for small business

These empower anyone to build their app vision with minimal technical barriers – no coding required!

 

What are the disadvantages of having an app for your business?

Potential downsides include:

  • High upfront development costs
  • Ongoing maintenance and update expenses
  • Additional staffing requirements
  • Fragmenting customer engagement
  • Technical complexity to support
  • Distracting from core business
  • Getting lost in crowded app stores
  • Security and compliance risks

Not optimizing the user experience or marketing effectively are also common pitfalls. Evaluate if an app delivers enough value over mobile sites to justify the tradeoffs.

 

Does an app need an LLC?

Legally registering your app business as an LLC is optional but has benefits as it provides liability protection and tax advantages that sole proprietors lack. Having a formal business structure also lends more credibility when pitching investors, applying for loans/grants, and negotiating deals. Downsides of LLCs include increased legal/accounting fees and paperwork. Overall the protections are likely worthwhile if app revenues will be significant.

 

Do I have to register my app as a business?

No – you can operate your app informally as a sole proprietor using your SSN for tax ID. However, establishing an LLC or corporation better protects your personal assets from any legal issues. Also, having a registered business entity facilitates opening business bank accounts, adds credibility, and enables more professional partnerships. Consider if the structure matches your growth ambitions.

 

What are 5-10 examples business applications?

Custom business applications

Common business apps include:

  • Enterprise Resource Planning (ERP)
  • Customer Relationship Management (CRM)
  • Human Resource Information Systems (HRIS)
  • Supply Chain Management (SCM)
  • Business Intelligence and Analytics
  • Project Management
  • Content Management Systems (CMS)

 

Some other major categories of business apps are:

  • Accounting and Finance
  • Sales Enablement and eCommerce
  • Marketing Automation
  • IT Service Management (ITSM)
  • Enterprise Asset Management (EAM)

 

Leading providers of business applications include:

  • SAP
  • Salesforce
  • Oracle
  • IBM
  • Zoho
  • ServiceNow
  • HubSpot
  • Dropbox
  • Slack
  • Zenefits

 

What are 5-10 examples of customized software?

Common types of custom business software include:

  • Workflow Automation Tools
  • Custom CRM Systems
  • Tailored ERP Solutions
  • Specialized Analytics Dashboards
  • Custom eCommerce Sites
  • Industry-Specific Databases
  • Custom Mobile Apps
  • Proprietary Algorithms
  • Specialized Integrations
  • Custom Hardware Interfaces

 

Reasons companies invest in custom systems include:

  • Streamline unique processes
  • Competitive differentiation
  • Improve productivity
  • Replace outdated technology
  • Unify disparate systems
  • Meet niche industry needs
  • Facilitate business growth
  • Reduce costs
  • Enhance customer experience

 

Why do businesses build custom application software?

Top drivers for custom business apps are:

  1. Competitive Advantage – Unique and innovative tools competitors lack
  2. Workflow Optimization – Tailor systems to specialized business processes
  3. Productivity Gains – Automate manual tasks to accelerate operations
  4. Cost Savings – Consolidate systems and enhance efficiency
  5. Customer Experience – Develop high-quality front-end interfaces
  6. Scalability – Build on modern stacks ready for growth
  7. Data Leverage – Centralize data for deeper analytics
  8. Future-Proofing – Overhaul outdated legacy infrastructure
  9. Niche Industry Needs – Meet specialized use cases and regulations
  10. New Revenue Streams – Launch new digital products, services, or partnerships

 

What is the difference between standard and custom application?

Standard Applications Custom Applications
Generic software designed for many businesses Tailored to individual business needs
Pre-built functionality Configurable features and workflows
Limited customization options Highly customizable
Constrained capabilities Scalable and extensible
Cannot handle niche industry processes Specialized use case support
Shorter implementation timeslines Longer development cycles
Lower upfront costs Higher upfront investments
Ongoing licensing model Owned asset

While custom systems require greater effort to create, they deliver exponentially more value long term by perfectly matching desired functionality.

 

What is a custom business object?

A custom business object is a specialized data structure tailored to capture information unique to a company’s workflows and processes in a custom software application.

For example, an aviation company could define a Flight Route business object that contains departure/arrival airports, aircraft type, mileage, fuel stops, and other data fields related to flight plans. This encapsulates the concept of flight routes with relevant attributes for reuse across the software system, abstracting complexity.

 

What is a custom software company?

A custom software company is one focused on building specialized business applications tailored to each client’s specific needs and use cases rather than generic off-the-shelf solutions.

Skills include:

  • Requirements Analysis
  • Process Mapping
  • UI/UX Design
  • Custom Programming
  • Legacy System Integration
  • Project Management
  • Testing and QA

Leading full-cycle firms have expertise across web, mobile, cloud, and emerging technologies to deliver complete end-to-end development from planning through deployment and maintenance.

 

What business opportunity is the best in the world?

There is no definitive “best” business as needs, interests, and strengths vary tremendously by person. However, some top opportunities include:

  • Technology – Software, IT services, app/web development, AI, IoT, cloud computing
  • Healthcare – Biotech, medical devices, telemedicine, home care
  • Financial Services – Investment platforms, blockchain, insurtech, payments
  • Education – Online courses, corporate training, test prep
  • Media Production – Video streaming, podcasts, influencer marketing
  • Ecommerce – Online retail across expanding niches
  • Renewable Energy – Solar, wind, EV charging infrastructure

Evaluate your skills, passions, location, target customers, and competitive landscape to determine optimal ideas. But tech-enabled scalable businesses have incredible growth runways.

 

Is there an app for businesses that are for sale?

Yes, you can buy existing app businesses in marketplaces like:

App Business Brokers

  • Flippa (highly recommended)
  • Exchange
  • BizBuySell
  • WebsiteBroker

These have listings for profitable mobile apps and established web apps with existing traction. You can also find apps for sale directly from founders raising capital or serial entrepreneurs launching new ventures. Evaluate metrics like active users, revenue and cash flows, technologies used, code quality, customer reviews, and market potential when assessing app acquisition opportunities.

 

What app is Business Suite?

Meta Business Suite is a unified platform announced by Meta (Facebook) in 2022 to provide businesses with easier access to tools across their family of apps – Facebook, Instagram, Messenger, and WhatsApp – to manage communications, ads, commerce, and analytics.

Core capabilities include:

  • Unified inbox across apps
  • Cross-app analytics
  • Ad campaign management
  • Automated messaging
  • Instagram shopping integration

This consolidates the previously fragmented experience into one dashboard for simplified leveraging of Meta’s networks and reach.

 

Resources:

[1] https://designli.co/blog/key-questions-to-ask-when-buying-custom-software/

[2] https://discoverbigfish.com/blog/questions-custom-app-development.html

[3] https://support.greenhouse.io/hc/en-us/articles/360025086132-Private-custom-application-question

[4] https://www.linkedin.com/pulse/5-key-questions-ctos-should-ask-before-starting-custom-software-

[5] https://fusetg.com/12-key-questions-to-ask-concerning-custom-application-development/

 

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