What Is the Cost of Developing a Travel App?

Maryna Pasko
Market Researcher

It seems like there are mobile apps for everything now, and travel services are no exception. People rely on mobile travel apps to reserve tours, book flights, and accommodation, etc. The statistics are quite impressive, for example, 71 per cent of smartphone owners use their phones for travel and do so at least once a week.

Building a travel app is a smart solution for tourism service providers, as most travellers prefer apps over mobile sites due to extended functionalities and the possibility of offline access.

How much does it cost to develop a travel app?

Building a minimum viable product (MVP), with limited features, costs between $15,000 and $75,000 and takes two to four months. Developing a complex, full-featured travel app is costlier and time-consuming, so expect longer development times and prices starting at $100,000.

These prices are an approximate average as the final cost entirely depends on the set of features, the platform you choose, and the developers' rates.

We consider these factors in detail later in the article. But first, let’s discover how people's travel habits have changed.

Travel Trends: New Opportunities For the Industry

The travel industry was hit hard by the global pandemic and regional lockdowns — tourism sector spendings reduced by $8.1 trillion when compared to pre-Covid levels.

Industry giants are declaring revenue losses after several years of sustained growth. Expedia's revenue, for example, sank 82 per cent during the second quarter of 2020. But it was not only big players that suffered, investment in travel startups fell by 26 per cent over the same period.

Travelling nowadays is ingrained in our lives so deeply that even during the strictest lockdowns people went abroad. Airlines were selling flight tickets, and hotels kept accommodating tourists, albeit with certain restrictions and limitations.

Although our regular travel patterns were highly disrupted, people found plenty of ways to quench their thirst for wanderlust. Virtual travelling, for instance, became a massive trend.

Virtual Tours

Virtual tours to World Heritage Sites skyrocketed during initial lockdowns and continue to maintain an audience.

Now, travel enthusiasts can take online tours to famous museums and galleries, enjoy top views of landmarks like Mount Everest or Teotihuacan, and even digitally wander the streets of any city on the planet — all possible with just a device in hand.

With apps such as Google Cardboards and Sites in VR, anyone can visit the world’s most famous monuments and natural wonders. Ascape VR app went one step further and now offers virtual skydiving and snorkelling.

Rural Tourism

Another popular trend in 2021 is rural and local tourism. More people discovered local attractions and engaged in activities like hiking, biking, and camping.

The shift to domestic travel is evident in countries worldwide, Americans, for example, consider camping one of the safest types of travel in the pandemic. For this reason, startups focused on rural tourism, such as Nautal or Snaptrip, are facing increased interest. These apps allow travellers to rent cars, boats, and camper vans as well as to book accommodation in rural areas.

Personal Approach

What else can we expect from the travel market in the foreseeable future? We will probably see group travel falling in popularity, as people consider more private, exclusive ways of travelling and will expect a personal approach.

Top travel brands provide personalised customer service and experiences through their user experience (UX) and user interface (UI). Data collection and analysis allows brands to provide recommendations based on a customer’s past interactions on a digital platform.

Trip Flexibility

Another significant demand in the market will be trip flexibility. As the situation worldwide may remain uncertain for some time, travellers will expect high trip flexibility and free booking cancellation policies.

Future of Travel? No Worries

The industry has already started a slow recovery and experts are relatively optimistic about the future of travel. Some commentators note that we should expect an international air travel resurgence. In fact, a majority of the Americans surveyed by the travel insurance provider, Squaremouth, planned to take international trips at the beginning of 2021 and overseas destinations accounted for 86 per cent of planned holidays in January and February 2021.

In this climate, travel startups have a massive role to play in the industry's recovery by restoring our confidence in travel and helping us to adjust to the new normal.

If you decide to invest in a travel app, a thorough consideration of the current and foreseeable travel trends is critical, so you can release the exact product the user needs.

Creating an MVP first with one or a couple of main features allows you to test the app idea and attract an initial audience. In the case of success, an MVP may further develop into a full-featured app. But what features are the most essential for an MVP?

Travel App MVP Features

There are plenty of travel apps built for various travel purposes. Some have a narrow scope, such as Google Maps, which works for navigation and route planning, or Meetup, which is best for finding local events. Others, including TripIt, are multipurpose trip planners.

A successful travel app MVP should solve the user’s problems. For example, a travel booking MVP must include search and basic filters, as well as integrated payment systems. It will allow users to search for travel products according to their preferences and pay for their bookings via the app.

Shortly after testing such a product on the market, you may consider adding advanced filters, multilingual support, global currency support, and other common booking app features.

Besides booking apps, travellers rely on trip planners and itinerary generators, which are great tools for managing each aspect of the journey.

TripIt is one of the better-known trip organisers, the intuitive app helps create a complex itinerary from a user’s existing reservations. The app also sends users real-time alerts of any changes or cancellations.

Most trip planning apps have a similar concept but serve different travel purposes. App in the air guides travellers through the entire flight process, reminding the user of the gate, estimated time of arrival, check-in requirements, baggage tips, and so on.

Apps like PackPoint and DUFL are all about packing, and RoadTrippers is a great help when planning road trips and discovering destinations, attractions, and useful stops along the way.

The above examples are complex, full-featured applications with multiple functions. As mentioned before, an MVP should have just one or two particular features that solve a user’s problem. Features like searching for itineraries and setting up schedules are among the top priorities for travel organisation apps.

The itinerary is a detailed visualisation of a travel plan — from getting on the plane to checking in at the hotel. It could also include places of interest, sightseeing, restaurants, and other popular tourist spots. Itineraries can be created automatically or manually. TripIt, for instance, asks the user to forward all their confirmed reservations and then analyses the data and builds the itinerary.

For apps like RoadTrippers, route planning and navigation are the primary features, so maps must be integrated at the MVP stage.

Let’s suppose you already have a basic vision of your MVP and its main features, and now you need to decide on a suitable business model. It's smart to plan your investment return in advance, so here are few ideas for monetization.

How To Monetize Your Travel App

If you want to receive a profit from your app, you need to think of a suitable monetization strategy. There are several monetization models possible in travel apps, the simplest of which is a purchase price for the initial download. In this case, your app should provide sufficient value or offer exclusive services to entice people to make a purchase.

Paid subscriptions, where users are charged to use the app, are another way to monetize. But again, your app's exclusiveness and value has to justify the subscription cost, otherwise, users will be hesitant to pay for it regularly.

If these models aren't compatible with your app's concept, consider the well-known monetization strategies described below.

Premium Features

Most apps offer free downloads and basic services without any charges. App owners make a profit from users who pay additional money in exchange for enhanced premium services instead.

There are plenty of extras to offer travellers, for example, the premium version of TripIt provides country-specific information, monitors potentials fare refunds, and sends members real-time alerts.

Advertising

Broadcasting ads through a mobile app is one of the most popular strategies. For travel apps, it works incredibly well, as you can sell advertisement space to companies related to the tourism industry. Users will see information close to their search queries, like tour operator ads, hotels in their destination country, and airline promotions.

For example, you can get $0.10 for the simplest banner ad demonstration, while a video advert can net you around $5 to 10.

Commission Fee

Another profitable model for travel apps is affiliate commissions. Under this strategy, you set a percentage for each reservation a user makes, whether it's a hotel, flight, or tour reservation. In some apps, the commission is fixed. Hopper, for instance, charges $5 for each flight booking.

Cost of Travel App Development

Your profit ultimately comes from traffic and downloads — the more people who use your app, the more money they bring.

But here's a critical question: which platform should you launch your app on, and which offers greater potential in terms of user numbers and, in turn, a better return on investment (ROI)?

iOS vs Android: Which Platform Offers Better ROI?

In terms of market share, Android has been the leading platform worldwide since 2016. In the second quarter of 2020, the total number of downloads on the Apple and Google Play stores was 37.8 billion.

Google Play downloads accounted for over 28 billion during this period. But when it comes to revenue, the App Store nearly doubled Google Play’s income in the second quarter of 2020, according to Apple Insider.

The development complexity is higher for Android because of the fragmentation of Android-powered devices. For this same reason, building an Android app can be more time-consuming than developing an iOS application.

As for cost estimation, it's similar for both platforms, however, building an Android app may cost more because of the time factor.

If you need to launch the app on both platforms, but your budget is limited, you can save by developing a cross-platform app with the help of technologies like Flutter and React Native. For a detailed discussion, read our articles on development prices:

Price of iOS App Development: When To Choose iOS and How Much it Costs

Price of Android App Development: Why Choose Android and How Much it Costs

App Developer Rates

Developers' rates vary depending on location and team complexity. You can hire a single full-stack developer with a salary of $10,000 to $20,000 per month, or you could entrust your project to a team of professionals in an app development company.

To build a high-quality, mid-complexity travel app you will need a team of specialists. Below is a table showing hourly rates for experts with relevant experience and skills in the US and Australia.

Source: Salary.com

What Is The Cost of One Sprint?

Being aware of developers' hourly rates is useful, but it doesn't give a clear picture of overall project costs. Instead, it's better to consider the price of one sprint.

A sprint is a two-week development cycle where an agreed-upon set of development tasks takes place. Based on the above salary calculations, the average cost for one sprint is roughly $20,000 to $25,000.

The number of sprints required depends on the app’s complexity. For example, Atlas, our navigation app for truckers, was developed in 14 sprints. This complex app has a navigation and tracking system, as well as a route planning feature.

Okay, Now Show Me the Whole Picture

The general app development process comprises pre-development work, UX design and discovery, backend and frontend development, and quality assurance (QA) testing.

Developing the backend and frontend is the longest phase and can last from 6 to 24 weeks, depending on task complexity. Product design and discovery usually take from 2 to 8 weeks, as does QA prior to the launch.

Additionally, you need to consider post-launch support and maintenance costs, which on average accounts for 20 per cent of the development budget.

The Bottom Line

The cost of travel app development ranges widely with aspects such as feature complexity and integration with third-parties forming the majority of your expenses. While travel app development may be a costly endeavour, there is plenty of scope for savvy investors to capitalise on society's changing travel habits by creating a product that answers the unique needs of today's traveller.

Have a travel app idea in mind? Drop us a line with a brief description of your app concept, and we'll get in touch with a quote and further information about our services.

28 December 2020