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How to start a mobile app business
How to build your mobile app business with the right app structure and equipment.
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The mobile app industry has boomed over recent years, but this doesn't necessarily mean the market is saturated. Starting up in the smartphone app world begins with identifying a gap in the industry. With this, you can earn a steady revenue from your app through different avenues.
Read on for your guide to starting your smartphone app business.
What's in this guide?
What is a mobile app business?
A mobile app business creates new smartphone applications that can be downloaded by mobile users or bought by other businesses for their own use. These applications have a nearly unlimited range of uses, from entertainment and gaming to online banking and shopping.
Decide what type of mobile app business you want to run
Before you can start building and selling your own app, you need to decide what type of business you want to run. Are you going to create apps for people to download via app stores or are you going to be a B2B company that creates apps for other businesses?
You will also need to decide whether you want to take on all of the work by yourself or hire some people to help you. This will depend on your time and personal skills, and the scope of the apps you want to create.
Choose a business structure
To start any registered business in Australia, you need to decide on a business structure. You can choose between three types of structures:
- Sole Trader. A Sole Trader is a one-person business. In this case, you will take on sole responsibility for your business.
- Partnership. A Partnership is when two or more people choose to start a business together. All partners share equal responsibility for the company.
- Company. A Company is its own legal entity. Because a Company is owned and controlled by shareholders, it offers some protection from personal liability.
There are a few more steps to setting up a business that you need to be aware of, such as registering for your Australian Business Number (ABN).
Choose what type of smartphone app your business will create
Just like a business structure, you will need to consider the kind of app that you will create.
- Native apps. A native app is developed for a specific platform, for example, an iOS phone or Android phone. iOS apps are built in Objective C or Swift, while Android apps are built in Java.
- Web apps. A web app is accessed through a browser on your phone. You cannot download these apps from the app store. They seem similar to an app because of their interactivity and functionality. They require an Internet connection to work.
- Hybrid apps. Hybrid apps can be downloaded from an app store and are available on your home screen, but they rely on a browser to be accessed. They are developed using standard web technologies.
Research your market
If you want to have any chance of your app being successful, then you will need to research your audience and competitors first. You need to know the landscape of the market you're planning on entering into, to see whether your app is viable or not. This will also help you to identify how you can improve on what your competitors are doing and help make your app stand out.
Note any legal requirements
Operating a mobile app business comes with a few legal implications if you want to protect your intellectual property and your future customers. Here are some legal considerations and documents:
- Confidentiality Agreement. If you approach anyone, like an investor, with your app idea then you might want to have them sign a Confidentiality Agreement to protect your idea from theft.
- Copyright. If you decide to hire any developers or work with employees, then you can add a copyright clause to their contracts to make sure you own the Intellectual Property (IP).
- Trademark. You can register your app IP, logo and any other designs with IP Australia to make sure others can't steal your idea.
- Privacy Policy. You'll want to include a Privacy Policy and other Terms and Conditions on your app page and/or website. This is supposed to protect both you and your customers.
It can be simpler to use proven legal templates for these types of documents rather than writing them from scratch yourself, although you might still want to consult with a legal service provider to make sure everything is covered correctly.
Get access to legal services and documents online
Does your company belong in this list?
Consider taking an app development course
There are several online courses, training and bootcamps available for those interested in becoming mobile app developers. In as little as 8 to 12 weeks, these courses can help you develop the skills to understand the principles of secure, stable software design. You can apply for online software development courses at:
- Coursera
- TAFE
- RMIT online
If your budget does not allow you to hire freelancers or outsource developers, learning to code in two or more programming languages can help you. It is a good idea to have an understanding of the basics. You can find online courses at:
- freeCodeCamp
- edX
- Codecademy
- Web Fundamentals
Want to learn more?
Access thousands of courses from some of Australia's leading providers.
Consult developer guides and resources
The web is packed with helpful guides and resources to help you through the process of creating your app, whether you're coding from scratch or using app builder tools to help you.
You may also want to consult the developer resources provided by either the Google Play Store or the Apple App Store, or both, depending on where you're going to list your app. Keep in mind that you will have to register as a developer on either platform and this comes with some fees. Each platform also takes a cut from your app earnings once you've launched your app.
Equipment and software needed to start a mobile app business
As an app developer, you'll need to equip yourself and any staff members with the correct software and hardware to get the job done.
Physical equipment will depend on whether you're setting up a brick and mortar business or working from home. An office naturally comes with higher set-up costs as you'll need to hire a space, supply furniture and everything else. If you're working from home, either alone or with remote employees, then you just need to make sure everyone has a PC/laptop and an adequate Internet connection.
The type of software you might need will include:
- Software development kit (SDK). If you're going to code the app yourself (or with other developers) then you need an SDK, which provides the collection of software development tools you need to build an app.
- App builder. If you don't have the skills for coding or software coding, you can try app builders such as GoodBarber, Appy Pie, GameSalad and App Institute.
- App prototyping software. Before sending your app out into the world, you will need to test its features and uses. Prototyping is essentially taking your app for a test drive. Prototyping on Paper, Figma, Proto.io and InVisionApp are just some of the available platforms.
- Analytics. Using an analytics tool will help you understand how the app is performing. An analysis of your customers will also give you an in-depth knowledge of their behavioural data. You'll get a detailed overview of the return on your investment by checking the cost per install, cost per click, cost per acquisition and cost per thousand. Analytics also help you develop better marketing strategies. Some analytics platforms you can look at include Google Analytics, Localytics and New Relic.
- Advertising. Social media can be a great place to start with advertising and there are online courses you can take to become effective at running these ads. You can also reach out to influencers in your niche to generate reviews which will build your pre-launch buzz. You can create content like a promo video or by pitching to blogs.
Compare personal loans to help kickstart your business
Why compare personal loans? If you're starting a business, it can be hard getting approved for a business loan. Lenders usually look for a business that has been operating for at least a year and is making over $10,000 per month.
With personal loans, lenders look at how likely you'll be able to repay the loan based on things like your credit score, employment history and your existing debts. Before taking out a personal loan, make sure you can afford to make the repayments plus any additional fees or charges.
What app types will your app business create?
Each kind of app structure comes with its own pros and cons, which you'll have to weigh up when deciding which type of app you want to focus on.
Native apps
Pros
- These apps can work offline, making them more convenient for the user.
- Provide full integration with a device's built-in features.
- The app might work better and faster since it's tailored to the platform.
- Users will have an easier time finding and trusting the app thanks to mobile app stores.
- App stores provide guidance and support.
Cons
- May take longer to develop since you're restricted by the platform(s) you're creating for.
- Will need two or more dedicated teams if you're looking to create a native app for more than one platform.
- The development process can be expensive.
Web apps
Pros
- These apps can be easier to maintain because the code doesn't change when people use different devices.
- Web apps can work just as well on older devices.
- Since the app won't be featured on an app store, there's much less red tape to get through.
Cons
- These apps require an Internet connection to work.
- Web apps are harder to find because they aren't featured on app stores.
- It's harder to integrate device functions into the app and this limits what it can do.
Hybrid apps
Pros
- Cheaper to develop than a native app.
- Usually much easier to maintain.
- Can be less time-consuming to develop, depending on the features of the app.
- Doesn't require additional time building for separate platforms.
Cons
- These apps require an Internet connection to update, though some can still be used offline.
- There are limits to how much device functionality the app can access.
- Relies on plugins to work which can become outdated or unreliable.
- Updates may require additional modifications for separate platforms.
Pick a monetisation option
Getting revenue from your app is different from selling physical goods and services. People will want to try out the app or might even opt for a similar but free app. Some ways you can make an income from your app are through:
- Advertising. You can choose to have some in-ad apps which will vary by country and whether the user is a premium user.
- Premium features. Offer your users the choice of paying for premium features. This allows users access to the basic features of your app and has the option to upgrade when they can.
- Paid apps. These apps require a user to pay to download it from the app store.
- In-app purchases. Another way to get revenue is to provide digital or physical products users can buy through the app.
- Subscriptions. A subscription-based app offers a steady source of income. Users can access premium content and features through a monthly payment.
- Sponsorships. Partner with well-known brands to generate user engagement from your following.
Build a marketing strategy for your app
One of the factors that can heavily influence an app's success is its online presence and branding. You may want to start your marketing efforts a while before your app even hits any app stores in order to build up buzz around your product.
Your marketing strategy should include all of your branding (design, colours, logo, etc.), and audience research to see which platforms your potential customers are on and what type of content they interact with. All of this should inform the content you create for your marketing campaign.
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Accept payments from your customers in person and online with Square's card readers, payment terminals, digital invoicing and e-commerce tools.Frequently asked questions
Can I build an app if I don't know how to code?
Yes. You don't need to have advanced coding skills to start a smartphone app business. Take advantage of app building platforms like GoodBarber, Appy Pie, GameSalad and App Institute.
How can I protect my app idea?
During the development phase of your app, have your collaborators sign a non-disclosure agreement before discussing your app with them.
How long does it take to develop an app?
The time taken to develop an app depends on the features, complexity and the platforms your app will be on. Generally, it should take three months from app development to the app being on the market. You will need to consistently test your app, test it with users and encourage feedback.
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