9th April 2025

Mobile App Development for SMEs: Is It Worth the Investment?

In a world where smartphones are ubiquitous, many small and medium-sized enterprises (SMEs) wonder if they should join the mobile app bandwagon. Developing a mobile app can be an exciting opportunity to engage customers, streamline operations, or open new revenue streams. But it’s also a significant investment – not just in money, but in time and ongoing maintenance. Unlike a website, which is accessible to anyone with a browser, an app requires users to find it, install it, and regularly update it. So, is building a mobile app really worth it for an SME?

This post will explore the pros and cons of mobile app development for SMEs and help you evaluate whether it makes sense for your business. We’ll look at scenarios where an app can provide strong value (and examples of SMEs using them effectively), as well as factors like cost, alternative solutions, and how to ensure ROI if you do go down the app path. With a clear understanding, you can make an informed decision on whether to invest in that shiny new app or focus your resources elsewhere.

Potential Benefits of a Mobile App for SMEs

1. Enhanced Customer Engagement and Loyalty:
A mobile app lives on the user’s home screen (if they choose to keep it there), acting as a constant brand reminder. It can provide a more personalised and interactive experience than a website. For example, an app can send push notifications – perhaps a coffee shop SME sends a “Good morning! Show this notification for 10% off your coffee today” to its app users, driving footfall. Or a fitness studio app might remind users of upcoming classes they’ve booked. According to research, push notifications can significantly boost retention and engagement if used wisely (but overuse can annoy – balance is key). Apps also allow features like loyalty programs (digital stamps, points, etc.) which can increase customer lifetime value.

2. Tailored User Experience and Functionality:
Mobile apps can leverage device features that websites typically can’t as easily. For instance:

• Offline access: A travel guide SME might offer an app where content is downloadable so travellers can access info even without internet abroad.
• Camera: A home decor SME could have an AR (augmented reality) app to visualise how furniture looks in a customer’s room using the phone’s camera.
• GPS: A retail SME could prompt users via the app when they’re near a store with a special offer (geo-fencing marketing). These kinds of functionalities, if aligned with business, can delight users and differentiate the SME from competitors. They can make using your service more convenient than via a browser.

3. Revenue Opportunities:
Apps can directly or indirectly open new revenue streams. Directly, you could sell the app (though most SMEs likely want it free to encourage usage) or have in-app purchases (like a subscription for premium features, common in content or service apps). Indirectly, better engagement via an app could increase core sales. For example, an SME fashion boutique might see app users buying more frequently thanks to ease of browsing and exclusive app promos. Another angle: maybe the app itself is the product – e.g., an SME that creates a utility app and sells it globally (not a customer-engagement scenario but a new product line). This drifts into being a software company, but some SMEs do pivot or extend into digital products.

4. Competitive Edge and Brand Perception:
Having an app can position an SME as tech-forward and convenient. If none of your local competitors have an app, you might attract the mobile-preferring demographic. For instance, a local restaurant might stand out by letting people order via an app for pickup/delivery (like many chains do) where competitors might only take phone calls or web orders. Apps can also deepen brand identity – the design and icon on a user’s phone is like a mini billboard. However, this only matters if users actually value the app; a poorly made app could hurt perception more than help (we’ll cover pitfalls later).

5. Streamlining Operations (Internal Apps):
Not all apps are customer-facing. SMEs could benefit from internal apps to improve processes. For example, a small logistics SME might have a custom mobile app for their drivers to manage deliveries (scan packages, get routes, mark delivered). Or a field service SME (like appliance repair) with an app for technicians to view jobs and inventory on the go. These cases improve efficiency and data accuracy. They might not bring new revenue directly, but they save cost and time. With modern low-code platforms, even SMEs can create simple internal apps relatively affordably.

The Costs and Challenges

Now, the flip side – why many SMEs hesitate:

1. Development and Maintenance Cost:
A professionally built mobile app typically costs anywhere from £10k for a very basic app to £50k+ for more complex or multi-platform ones (iOS and Android). SMEs often have tight budgets; that money could perhaps yield more immediate returns if invested in marketing or improving a website that works on mobile browsers. And it’s not one-off: apps require updates (new OS versions, security, small improvements). Unlike a website where you can fix something and it’s instantly live for everyone, an app update must be pushed to app stores and then users have to download it. So, an app is a commitment to at least some ongoing support expense.

2. Need for User Adoption:
One of the biggest challenges: getting people to download and regularly use your app. Think about it – how often do you download a new app? People are selective; phone storage and clutter is a real concern. If you already have a decent mobile website, some customers may not see a need for an app. A stat often cited is that the average user uses about 9 apps per day and 30 per month, and a lot of those are major ones (Facebook, email, etc.)​. So breaking into someone’s routine is hard. You might have to incentivise the download (e.g., “20% off your first order via our app!”) and continually provide value to avoid uninstall (make sure that discount isn’t the only reason they came). If only a small fraction of your customers use the app, the ROI diminishes.

3. Maintenance of Two Platforms:
If you want to reach both iPhone and Android users (which is nearly always yes, since together they cover basically all smartphone users), you either develop two native apps or use a cross-platform approach. Native (separate Swift for iOS and Kotlin/Java for Android) can give the best experience but it’s like building two apps = roughly double cost. Cross-platform frameworks (Flutter, React Native, etc.) allow one codebase but sometimes with trade-offs in performance or some native UI feel. And you still need testing on both platforms. As an SME, maintaining expertise for both (either in-house or via an agency) is something to plan for. Also, dealing with app store submissions, guidelines, etc., can be a learning curve – e.g., Apple might reject an app if it doesn’t meet certain criteria (they don’t allow very buggy apps, or ones that just wrap a mobile website without providing extra value).

4. Ongoing Engagement and Updates:
Launching the app is only the start. You should monitor its usage (using analytics tools) and gather feedback. Users will expect improvements or new features over time, especially if they report bugs or have suggestions. If you ignore an app, it can wither – users may stop using it if it feels stale or incompatible with their new device. So you need some product development mindset around it, which means allocation of resources continuously. For a busy SME, that’s a commitment – though not impossible with planning and maybe phasing features.

5. Alternative Solutions Might Suffice:
Sometimes what you want from an app can be achieved via other means:

• A Progressive Web App (PWA) is essentially a website that can act like an app. Users can “add to home screen” from the browser, it can work offline, send push notifications (on Android for now, iOS now supports some push for PWAs too). For some SMEs, making their website a PWA is a cheaper way to get some app-like benefits without building separate native apps. It won’t be listed in app stores, but distributing via web link is sometimes easier anyway.
• If your goal is online ordering, many SMEs use existing platforms (like if you’re a restaurant, being on Deliveroo/UberEats plus having a mobile-friendly site might be enough rather than a whole custom app).
• If your goal is loyalty, there are third-party loyalty apps that let customers track multiple loyalty programs in one app, or even just doing it via email/SMS can work.

So asking “what unique value would a dedicated app offer that my mobile site or other channels can’t?” is a critical question. If the answer isn’t clear, an app might not be justified yet.

When an App Makes Sense for an SME

From the above, apps shine when:

• You need native features or offline: e.g., a navigation app for a tourism SME (needs GPS and offline maps), or a tool app that interacts with hardware.
• You have a highly engaged user base that interacts frequently: e.g., a niche community or a service used daily. A gym with many classes might benefit as members check schedules daily and book – an app could smooth that and provide personalised reminders. If users are coming weekly or more, they might welcome a dedicated app for convenience.
• Value-added service: The app provides such value that even non-customers use it, potentially attracting them to become customers. For instance, a gardening supplies SME could create an app that helps identify plants or pests via camera AI – people download it for that utility, and it subtly promotes their products as solutions.
• Operational efficiency: as mentioned with internal apps, if something like an app for staff or partner use will save time/money (like digital forms replacing paper, realtime updates, etc.), it can be worth it even if customers never see it.

Case example: I recall a story of a small café that built a simple order-ahead app. It cost them, but it allowed regulars to order coffee on the way and just pick it up – building great loyalty and differentiating them in the local market. They saw increased morning rush throughput. For them, it made sense. But a café down the street might not bother if they rely on foot traffic and personal service rather than speed.

It can also be a branding choice: if you position yourself as tech-savvy (maybe you’re an SME targeting younger audiences), an app could be part of that image. Just ensure that audience indeed wants an app.

Keeping Costs Manageable if You Decide to Build

If you determine an app is beneficial, some tips:

• Start with MVP (Minimum Viable Product): Don’t try to include every feature in version 1. Focus on a core use case executed really well. You can add bells and whistles later after getting user feedback. This controls initial costs and gets you to market faster.
• Cross-platform frameworks: Consider using something like Flutter or React Native to build for both iOS and Android at once. Many SMEs go this route. It may slightly compromise on edge-case polish, but often users won’t notice if done correctly, and it’s significantly cost-saving for initial build and ongoing one-codebase maintenance.
• Outsource or hire carefully: If you don’t have an in-house dev, find a developer or small agency experienced in SME apps, not just huge enterprise projects. They might have reusable components or a lean approach suited for smaller budgets. Get a few quotes and check portfolios. Cheaper isn’t always better; you want quality to avoid spending more later fixing things.
• Use existing services: For parts of the app like authentication, analytics, push notifications – use free/cheap services (Firebase is a popular backend-as-a-service that handles many basics and has a generous free tier). This avoids reinventing wheels and speeds up development.
• Test with your loyal customers: Involve some regular customers in beta testing. They’ll provide feedback and also feel valued (which increases loyalty). They might catch UX issues early. This helps ensure when you fully launch, the app resonates well.

And importantly, plan how you’ll promote the app. Even your existing customers need to know it exists and why to use it. Leverage all channels – in-store signage, email newsletters, social media, maybe a launch event or discount for app users. An app no one uses is wasted investment.

Conclusion

Deciding on a mobile app comes down to weighing the potential unique benefits for your SME against the costs and effort required. In many cases, a responsive website or other solutions might be enough to cover your needs. But in some scenarios, an app can drive engagement, loyalty, or efficiency in ways nothing else can.

Think from your customers’ perspective: Would an app make interacting with your business significantly easier or more rewarding? If the answer is a strong yes (and you can articulate how: “It will let busy customers do X in 2 taps, whereas mobile web takes 5 steps”), then the investment may well be worth it.

Also consider the stage of your business. If you’re still struggling to perfect your core service or product or haven’t optimised your website yet, focus there first. An app on top of shaky fundamentals won’t fix underlying issues. But if you have a stable operation and are looking for growth and retention strategies, an app could be a strategic next step.

For those leaning towards developing an app, do it smartly – start lean, focus on user experience, and measure results. If you see positive adoption and outcomes, you can iterate and invest more confidently. If not, you can pivot or integrate feedback quickly due to your lean approach.

At Gemstone, we help SMEs evaluate and build mobile solutions that fit their business goals and resources. We understand the challenges and strive to create apps that deliver real value, not just novelty. If you’re considering a mobile app and want some expert guidance on the feasibility, cost, or development process, reach out to us. We’ll give you an honest assessment and, if it’s a go, help craft an app that truly benefits your business and your customers.

In summary: A mobile app can be a powerful tool for SMEs – but only when it aligns with a clear purpose and audience demand. Choose wisely, execute well, and it could be a worthwhile investment that elevates your customer engagement and growth to the next level.