14 Things You Need to Know (and DO) Before You Ask a Vendor to Build Your Mobile App

14 THINGS
YOU NEED TO KNOW (and do) BEFORE YOU ASK A
VENDOR TO BUILD YOUR COMPANY A MOBILE APP

First and foremost... Do you have enough time?

1
Building software is an intricate process. To build a stable product you cannot cut corners by:

• Hiring junior developers
• Not paying for project management
• Cutting out QA cycles
• Adding more warm bodies to the project

If you don’t have enough time to produce a great product don’t waste your money producing
an unstable or inferior one. Change your plan.

Mobile development will be different than what you’ve been doing
for the last 15 years.

2
Building native software for an operating system is different than building software for the
web. Most companies have been building on web technologies for the last 15 years, and
it’s been at least that long since developers had to build native software for an operating
system like the iOS or Android phones. The discipline for each is very different. On top of all
this, the lack of established libraries forces developers to re-code things that have been done
on the web for years. Limited physical resources like CPU and RAM mean that code has
to be extremely efficient, whereas on the web you practically have unlimited resources and
scalability.

Contact PointAbout at 202.391.0347, info@pointabout.com
or visit www.pointabout.com for more information.

The initial project will be an investment of more than $25,000 if
you plan on getting a stable, well designed application.

3
Building a mobile application for just one platform (i.e. iPhone, Android, Windows Phone,
Blackberry, or Nokia) cost tens of thousands of dollars. Writing that application so that it
works on multiple operating systems basically requires development to start from scratch.

Developers for the iPhone and iPad have to know Objective C, Android developers must know
Java, and Windows Phone developers need to know Silverlight. Deep knowledge in these
application development languages is in demand. Onshore, these developers can earn up to
a six figure salary. These rates go above and beyond $150 per hour with company overhead
costs included.

To break this down, at $150 per hour a $25,000 project is essentially a little over one month’s
worth of development effort. If a project breaks down like the below, then this is really only
a little over 2 weeks of actual development (i.e. writing code). Given that these projects are
about building products, you might ask how long it took Microsoft to create Microsoft Word.
The answer is hundreds, if not thousands, of man-years. Mobile application builds are not
nearly as complicated as building MS Word. They still go through similar processes however,
and require great attention to detail.

Application Quote Hours
1 Systems Requirement Specification 16.7
2 Development 100.0
3 Advertising & Analytics 16.7
4 Quality Assurance (Testing) 16.7
5 Project Management 16.7
Total 166.8

Keep in mind that this is just version 1 if you are successful. You will need to be prepared to
fund version 2, 3, 4 etc.

You can reduce the cost by going offshore but it is essential that you first gain a thorough
understanding of the issues with offshore development (OSD). Here is a link to familiarize
yourself with OSD:

• http://advice.cio.com/michael_kavis/offshore_blunders_who_is_to_blame

The net is that before you offshore you should determine your probability of success if you
have not managed an offshore project previously.


Pinch yourself. Are you suffering from too much app hype?

4
The iPhone’s success is mesmerizing. It seems like every day you read about another developer
who parlayed a silly iPhone application into a cool million overnight. Phones running Android
OS were activated at a clip of 160,000 a day in June 2010. The first Windows Phone 7 is slated
to launch this fall.

You see your competitors developing applications left and right. Your bosses are peppering
you with emails asking, “Where’s our iPhone app?” and “How quickly can we develop an app
for the iPad?”.

The hype is making companies pull the trigger before sitting down to think about what they
want to accomplish with their apps. Are your goals:

• New customer revenue?
• New revenue from existing customers?
• Increased productivity?
• Customer satisfaction?
• Market research?
• Branding?

If you know your business requirements, how are you planning on
measuring success?

5
If your goal is new customer revenue, how much revenue? Will the revenue come from
subscriptions? From application sales in iTunes? From in-app purchasing of content? Or is
the revenue from advertising?

• If the revenue is from in-app-purchasing, how do you feel about Apple taking 30% off
the top?

• If the revenue is from advertising, are you going to use advertising networks such as Apple
iAd or Millennial Media? What kind of ads do you want to run? Banner? Interstitial? Or
are you going to sell branded sponsorships?

• If the revenue will come from application sales, can you realistically expect to get a return
of more than the $25,000 to $50,000 it costs to create an app? By Apple’s own metrics,
each paid application returns, on average, less than $3,000 a year. Even with an astounding
$1,000,000,000 paid out to developers over the course of 2 years, there are 187,000
paid applications in the iTunes store. That averages out to $5,347 an app over 2 years, or
$2,673 an app per year.

If the goal is revenue, does the application have to pay for itself directly or is it part of a
broader strategy? If the application has to pay for itself, what is the timeframe?
Here are 2 great links on revenue from sales vs. revenue from advertisements:

• www.techcrunch.com/2009/03/22/should-an-iphone-app-developer-charge-or-run-ads-
galaxy-impact-case-study/#idc-cover
• blog.jwegener.com/2009/07/26/debunking-average-iphone-cpm-ad-rates/

If the goal is branding, how are you planning on managing success? Will it be surveys in
the application? Will it be feedback via iTunes if the application is an iPhone or iPad application?
What are the metrics? How do you plan on measuring downloads?

On that note, are you sure your application is going to be used once it is downloaded? Here
is a great link to information on application use:

• www.slideshare.net/pinchmedia/iphone-appstore-secrets-pinch-media?type=presentation

Do you know the audience demographic you are targeting?

6
You may think you need an iPhone application but does it match the demographic profile of
the audience you are trying to attract in order to meet your objectives? What other platforms
should you be considering?

Here are some interesting stats from Admob/Comscore on the iPhone/iPod Touch:

• blog.admob.com/2009/06/16/new-research-on-the-demographics-and-behavioral-
characteristics-of-iphone-and-ipod-touch-users-from-admob-and-comscore/

iPod Touch users are younger than iPhone users.

• 69% of iPod touch users are between 13 and 24 years of age, while this same segment
represents just 26% of iPhone users.

• 74% of iPhone users are over the age of 25, compared to 31% of iPod touch users.

iPhone users have higher income levels and are more likely to have kids; both devices
skew male.

• In line with the older demographic composition of iPhone users, they also have higher
incomes. 78% of iPhone users have an annual income of at least $25,000, compared to
only 66% of iPhone touch users.

• iPhone users are more likely to have children than iPod touch users, most probably due to
the age difference in the two groups. 46% of iPhone users have children, compared to
only 28% of iPod touch users.

• More than 70% of users on both the iPhone and iPod touch are male.

Media Consumption: Preference for the mobile web over other media

• 5 in 10 consumers on both iPhone and iPod touch devices use the mobile web more
frequently than they read printed newspapers.

• More than 40% of users of both devices reported using the Internet on their mobile device
more often than using the Web from their computers or listening to the radio.

How are you going to market your application? What is your
marketing budget?

7
If you are building an iPhone / iPad application and you are relying on downloads to achieve
your goals, then the sub-goal is to ensure you are listed as a top 25 application in your
category. Here is a great blog post on accomplishing this:

• www.timcascio.wordpress.com/2009/06/18/50-ways-to-promote-your-new-iphone-app

How do you plan on supporting the application once it is built?

8
Who is the point person for supporting the application and what is the process they will use
to support the application? For example, who is going to:

• Analyze all the great analytics that you are going to generate by the inclusion of Flurry,
Omniture, or Google Analytics?

• Review the application’s user comments?

• Review the application’s crash logs?

• Keep up with the platform’s next release and determine if your application is going to run
on that release? (Keep in mind most of your users will automatically update the OS from
Apple or Google and it is essential that your application work.)

• Oversee usability testing to ensure the application is maximized for success?


Who is the project manager that you are going to assign to this
project?

9
There are 2 sides to project management when building software with a 3rd-party vendor.
The vendor has to have a project manager to drive the creation of a software requirements
specification. PointAbout’s project managers:

• Gather requirements
• Produce wireframes
• Ensure data availability
• Define risks and mitigation plans
• Produce a Gantt chart for delivery, schedule and accountability

You as the customer must also have a project manager to ensure your team is providing for
elements such as:

• Input and approval of the design
• Data access

Then come the technical questions…is the data available to create
the application?

10
• What are the API calls to get the data for each of the screens that support the features of
the application?

• What 3rd-party data will you need to support the features of your application?

• Are there security issues related to the data needed in the application?


Ask these questions of your vendor before you hire them:

11
• How many native applications have you built for this mobile platform? Please provide
examples.

• What is the background of your project manager and who else have they built applications
for in my industry?

• Can you provide customer references?

• Can you give me examples of design work and, more importantly, UX work on this mobile
platform from your designer?

• What is the name of the tester that will be doing the QA for the application, and what
testing methodology will he/she use?

• What 3rd-party products will you be using?

• How much work will be done offshore? If any at all…will the architecture be completed
onshore? Will the project management be completed onshore?

Get worried when…

12
• Your vendor has not produced a RACI chart that you have signed off on before building
the systems requirements specification (SRS).

• Your vendor is not asking you to sign off on the SRS before moving forward with pixel
perfect graphics from the designer.

• Your vendor is not asking you to sign off on the pixel perfect designs before moving
forward with coding the application.

• You asked for a change to the application after the SRS and designs have been signed off
on and your vendor is not asking you for a change order.

• You are not getting weekly updates on where the project is in regards to hours used versus
total hours alotted, as well as risks and mitigation plans with the names of the people
responsible.


When to do a ‘Time and Materials Not To Exceed’ contract and
when to do a ‘Fixed Price’ contract.

13
First, some definitions:

A ‘Time and Materials’ (T&M) Contract obliges a consumer to pay a supplier a certain
negotiated rate during the execution of a project. The ‘Time and Materials’ contract places
the majority of the risk on the consumer, and generally has a lower price (at the outset) than
its ‘Fixed Price’ contract counterpart.

A ‘Fixed Price’ contract obliges the supplier to deliver a defined work-product to a consumer
at a predetermined price. A ‘Fixed Price’ contract shifts most or all risks from the consumer
to the supplier, and simultaneously shifts the management burden from the consumer to the
supplier.

Generally, a ‘Fixed Price’ contract will be more expensive than its ‘Time and Materials’ contract
counterpart (for the same project), at least at the outset. The difference in initial price represents
the value assigned to the risk by both the supplier and the customer.

Contract Type Positives Negatives
TIme and Materials NTE Flexible, shared risk, only what you Can go higher than expected
need, client has maximum control.
Fixed Price Limited customer risk, known budget Client has little control. Can create
requirement adversarial or “one time” relationship

Here is a great dialogue on the gives and gets of each type:

• c2.com/cgi/wiki?FixedPriceContract

AppMakr

14
If you don’t have the business plan, time, energy or budget to
deal with all that you have just read you can simply use our
AppMakr (www.appmakr.com) product and build a simple mobile
application for your brand at a very low cost with possibly a great
return.


14 Things You Need to Know (and DO) Before You Ask a Vendor to Build Your Mobile App

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14 Things You Need to Know (and DO) Before You Ask a Vendor to Build Your Mobile App