$425,000 are just the average expenditures including internal and external development costs as well as marketing costs. The expenditures don’t include maintenance or follow-up development costs after launch.
This report is 2nd report of our mHealth App Developer Economics 2017/2018, the largest global study on mobile and digital health apps.[/caption]
Companies that outsource a lot on development also outsource more of their external budget on marketing. And speaking of marketing: Their preferred marketing channels differ from the average: They are relying more on social media and influencer marketing.The biggest driver of development costs for a mobile health app is the part that has to do with electronic health records.
Pharma companies are outsourcing most of their app development
Companies that outsource more than average of their development budget are “Pharma companies” and “mHealth app companies”. Those companies outsource 80% or more of their external development budget. An analysis of the group of those “outsourcers” shows that:- Companies with a higher budget are outsourcing more of their budget. The more money a company has allocated for development, the more money will be outsourced.
- Big companies are outsourcing more of their budget than small companies. Corporations with more than 5,000 employees are outsourcing above average of their development budget.
- Companies with the business model “transaction” (e.g. selling drugs, selling devices) are outsourcing more of their budget, which again hints to pharma companies.
This report is 2nd report of our mHealth App Developer Economics 2017/2018, the largest global study on mobile and digital health apps.[/caption]
Companies that outsource a lot on development also outsource more of their external budget on marketing. And speaking of marketing: Their preferred marketing channels differ from the average: They are relying more on social media and influencer marketing.The biggest driver of development costs for a mobile health app is the part that has to do with electronic health records.
mHealth app development is time-consuming
The complexity of health apps – mostly the complicated healthcare environment – is what drives up development time. Most apps are developed within one year (56%), 84% within 2 years. But also, most market players are inexperienced and need more time for their app development. As we know from our previous market analyses, the majority of market players in digital health is rather new to the industry, thus rather inexperienced. Even for experienced publishers it can take 3-4 months alone to e.g. adapt an mHealth app to US-American Medicare & Medicaid standards. For players who are not familiar with this subject and its regulations, it might take much longer.There are 325 000 healthcare apps on the marketHealth documents (e.g. related to Medicare & Medicaid) are often huge (with several hundred fields to be connected, which extends development time immensely. The time frame above (2 years) includes only the time until app launch. For most mobile health apps app development is not finished after the launch. For start-ups app development as well as development of the business model is an ongoing task, thus a long-term project. App with more functionalities, longer decision cycles, information seeking periods, higher marketing budgets or more complex technologies like machine learning will drive up costs.
