Creating an app might sound like an exciting way to make money, especially if you've spotted a problem that existing apps don't seem to solve. Perhaps you've thought of a useful budgeting tool, a meal-planning app, a fitness tracker or something that could make everyday life a little easier.

But before you start looking for developers or spending money on designs, there's one important question to answer.

How is your app actually going to make money?

It's easy to get caught up in the exciting side of building an app. You might have a long list of features, a name you love and a clear idea of how everything should look. But without a realistic business model, you could end up spending thousands of pounds creating something that people enjoy using but aren't willing to pay for.

And that's not much use if your aim is to turn your idea into a profitable business.

Here's what to consider before investing in app development, including the different ways apps generate income, what they might cost to build and how to choose the right people to help bring your idea to life.

Start with the business model, not the app design

One of the biggest mistakes you can make when developing an app is focusing on everything it could do before deciding how it will earn money.

Imagine you've come up with an idea for a meal-planning app.

You might want it to create weekly menus, generate shopping lists, scan barcodes, suggest recipes and connect with supermarkets. All of those features sound useful, but each one could increase the development cost.

Now imagine you've spent £15,000 building it, only to discover that most people are happy using free recipe websites and don't want another monthly subscription.

That's an expensive lesson.

A better approach is to decide who your app is for, what problem it solves and why someone would pay to use it.

For example, a meal-planning app designed specifically for busy families trying to reduce their weekly food bills might have a clearer purpose than one trying to do everything.

You could start with a simple weekly meal planner and shopping list, then introduce extra features if people actually want them.

The aim is to test whether your idea can make money before investing heavily in development.

Six ways to make money from an app

There isn't one business model that works for every app. The best option depends on what you're creating, who will use it and how often they'll need it.

Here are six common ways apps generate income.

1. Charge a monthly or annual subscription

Subscriptions are popular because they can provide regular income rather than relying on one-off purchases.

You might charge users £3.99 per month or £29.99 per year to access your app.

This could work particularly well for apps offering something people use regularly, such as:

• Fitness programmes and workout plans

• Budgeting and money management tools

• Meal planning and recipe collections

• Language learning

• Meditation and wellbeing resources

• Business productivity tools

The attraction is that recurring payments can make your income more predictable.

For example, if 500 people paid £4.99 per month, your app would generate £2,495 in monthly subscription revenue before fees, taxes and running costs.

Of course, getting 500 paying subscribers isn't necessarily easy.

People are becoming increasingly selective about subscriptions, particularly when they're already paying for streaming services, software and other monthly memberships.

You'll need to offer enough ongoing value to persuade customers to keep paying.

And remember, subscriptions come with ongoing responsibilities. You'll need to maintain the app, fix problems, provide customer support and potentially add new features.

2. Offer a free app with paid extras

Another option is to make your app free to download but charge for additional features.

This is often called a freemium business model.

For example, you might offer a free budgeting app that allows users to track their everyday spending.

Customers who want additional features, such as detailed financial reports, savings goals or multiple account connections, could upgrade to a paid version.

The benefit is that people can try your app before deciding whether it's worth paying for.

However, you'll need to strike the right balance.

If the free version is too limited, people might delete it before seeing its value. But if everything useful is available for free, they may have little reason to upgrade.

Think carefully about which features should be included as standard and which genuinely offer enough extra value to justify a charge.

3. Make money through advertising

Some apps earn money by displaying advertisements rather than charging users directly.

This is common with free games, news apps and other services that attract large numbers of users.

The obvious benefit is that people can use your app without paying anything.

But advertising generally works best when an app attracts significant traffic and regular engagement.

A small app with a few hundred users is unlikely to generate much advertising revenue.

You also need to consider the user experience. Too many adverts can become frustrating, especially if they interrupt whatever someone is trying to do.

If you're developing your first app, it may be sensible to treat advertising as an additional income stream rather than relying on it entirely.

4. Sell your app for a one-off fee

Not every app needs a subscription.

You could simply charge people to download it.

For example, you might create a specialist calculator, a digital planning tool or an app that helps people complete a particular task.

If your app costs £4.99 and you sell 1,000 copies, that's £4,990 in gross sales before platform fees, taxes and other expenses.

The advantage is that customers know exactly what they're paying.

There's no ongoing subscription to worry about, which can be particularly appealing when people are trying to reduce their monthly outgoings.

However, you'll need a steady stream of new customers to keep generating sales.

And even though people have only paid once, they'll still expect the app to work properly. You may need to provide updates and fixes as devices and operating systems change.

5. Take a commission from transactions

If you're creating a marketplace or booking platform, you could earn money by taking a percentage of each transaction.

Think about businesses such as Vinted, Etsy and Uber.

They connect people who want to buy something or use a service with people who can provide it.

You could apply a similar model to a smaller niche.

For example, you might develop an app connecting local dog walkers with pet owners, or one helping holidaymakers book independent activities.

Instead of charging people to download the app, you could take a commission whenever a booking or sale is completed.

The challenge is attracting enough customers and service providers to make the platform worthwhile.

People offering services won't necessarily join if there aren't any customers. But customers won't use an app if there aren't enough services available.

It's worth considering how you'll attract both sides before investing in development.

6. Use an app to support an existing business

Sometimes the app itself doesn't need to generate income directly.

Instead, it can help an existing small business make more money or operate more efficiently.

For example:

• A personal trainer could offer clients workout plans and appointment bookings.

• A cleaning business could allow customers to book and pay online.

• A bakery could accept orders for collection.

• A holiday rental business could provide guests with useful information and additional booking options.

• A small retailer could introduce a loyalty scheme or make repeat purchases easier.

This can be a more realistic starting point than trying to build the next big app.

You already have a business, customers and a product or service people are willing to pay for.

The app simply makes it easier for customers to spend money with you.

Of course, you'll still need to decide whether an app offers enough benefits over a mobile-friendly website to justify the expense.

How much does it cost to create an app?

App development costs can vary enormously.

A simple app with a few basic features might cost relatively little if you build it yourself using an existing platform.

But a complex app involving payments, user accounts, live information and custom functionality could cost tens of thousands of pounds or more.

Here are some broad estimates to help you understand the options.

These are illustrative estimates rather than fixed industry prices. Your actual costs will depend on the app's complexity, the developer's experience, location and ongoing requirements.

It's also important to remember that the initial development fee isn't necessarily the total cost.

You might need to budget for hosting, software subscriptions, security updates, app store fees, maintenance, customer support and marketing.

The cheapest quote isn't always the cheapest option in the long run, particularly if poor-quality development means paying someone else to rebuild your app later.

Can you build an app without coding?

Yes, and this could be worth exploring before spending thousands of pounds hiring developers.

No-code platforms allow you to create certain types of apps using visual tools rather than writing programming code yourself.

Some examples include Bubble, Glide and FlutterFlow.

These platforms can be useful for testing a business idea, creating a basic booking system or developing a relatively simple tool.

You might even be able to create a working prototype yourself.

However, no-code platforms have limitations.

Some advanced features can be difficult or expensive to implement, and you may become dependent on the platform's pricing, capabilities and technical restrictions.

You should also check what happens if you eventually want to move your app elsewhere.

For example, can you export the code or data? Will you need to rebuild everything if your app becomes more complicated?

No-code development can be a sensible way to test an idea, but it's worth understanding the long-term costs and limitations before committing.

How to choose an app development company

If your idea needs professional development, choosing the right company is an important decision.

You don't necessarily need the biggest agency or the most expensive team.

What matters is finding people who understand what you're trying to achieve, can explain the costs clearly and have experience building similar products.

For example, businesses considering software development by Litslink or another development agency should compare previous projects, technical experience, pricing and ongoing support before committing to a contract.

It's worth speaking to several developers rather than accepting the first quote.

And don't be afraid to ask questions, particularly if you're not especially technical yourself.

Check their previous work

Ask to see examples of apps they've developed.

Ideally, look for projects with similar features or requirements to yours.

You might also want to check independent reviews and ask whether they can provide references from previous clients.

A company might have an impressive website, but that doesn't automatically mean it's the right fit for your project.

Make sure you understand what's included

A development quote should clearly explain what you're paying for.

Does it include the initial design, testing and launch?

What happens if you discover a problem after the app goes live?

Are updates and maintenance included, or will they cost extra?

And what if you decide to change something halfway through the project?

The more you understand upfront, the less likely you are to face unexpected bills.

Confirm who owns the app

This is particularly important.

Before paying anyone to develop your app, make sure the contract explains who owns the source code, designs and other intellectual property.

You should also understand who controls the app store accounts, hosting and customer data.

You don't want to spend thousands of pounds building a business only to discover that you can't easily move your app to another developer.

If you're investing a significant amount, getting the contract checked by a suitable legal professional could be money well spent.

Look for realistic advice, not just promises

A good development partner should be willing to question your ideas.

That might sound strange when you're paying someone to build something for you.

But if you've requested twenty expensive features and only five are essential, you want someone who will explain that.

An agency that encourages you to start with a smaller, more affordable version could save you a considerable amount of money.

Be cautious of anyone promising that your app will become profitable or attract thousands of users.

No developer can guarantee commercial success.

Start small and test whether people will pay

One of the most sensible ways to reduce the financial risk of app development is to start with a minimum viable product, often shortened to MVP.

This is a basic version of your app that includes the essential features needed to solve the main problem.

It doesn't need every feature you've imagined.

For example, if you're developing a meal-planning app, your first version might simply allow people to create a weekly menu and generate a shopping list.

You could leave recipe recommendations, supermarket integrations and other extras until later.

Once people start using the app, you'll have a better idea of which features are genuinely valuable.

You can also test whether customers are willing to pay.

Before building anything, you might create a simple website explaining your idea and invite people to join a waiting list.

You could ask potential customers what they currently use, what frustrates them and whether they'd consider paying for a better solution.

A waiting list doesn't prove that people will become paying customers, but it can help you understand whether there's genuine interest.

A small paid trial or pre-order, where appropriate, can provide stronger evidence of demand.

Don't forget the cost of attracting customers

Even a brilliant app won't make money if nobody knows it exists.

And this is something that's easy to overlook when budgeting for development.

You might spend £10,000 building an app, only to discover you need another few thousand pounds to promote it.

Depending on your audience, marketing could involve:

• Search engine optimisation and helpful website content

• Social media marketing

• Paid advertising

• Email marketing

• Collaborations with relevant businesses or creators

• App store optimisation

• Recommendations and referral incentives

Some methods will cost more than others.

For example, if you already have a successful blog, website or social media following, you may be able to introduce your app to an existing audience.

But if you're starting from scratch, attracting your first customers could take considerable time and money.

It's worth thinking about your marketing strategy before you begin development rather than leaving it until launch day.

You should also consider how much you can afford to spend acquiring each customer.

If someone pays £4.99 once, spending £20 on advertising to attract that customer probably isn't sustainable.

But if a customer pays £9.99 every month and stays subscribed for a year, the figures could look very different.

You'll still need to account for running costs, fees and the possibility of customers cancelling.

Is creating an app a good way to make money?

It certainly can be, but it's not necessarily a quick or easy side hustle.

Some apps generate substantial revenue, while others never recover their development costs.

The outcome depends on much more than the quality of the app itself.

You need a useful idea, a realistic business model, enough customers willing to pay and a sensible approach to costs.

For someone starting with a limited budget, building a complicated app from scratch could be a considerable financial risk.

A simpler digital product, website or no-code tool might be a better starting point.

On the other hand, if you already run a business and an app could improve your services or make it easier for customers to buy from you, the investment might be easier to justify.

It all comes down to whether the app solves a real problem and has a realistic way of generating a return.

Final thoughts

If you're thinking about creating an app to make money, don't start by spending thousands of pounds on development.

Start by working out who your customers are, what problem you're solving and how much people might realistically pay.

Choose a business model that suits your idea, research the costs and test demand before committing to a large investment.

And if you decide to work with a developer, compare your options carefully and make sure you understand exactly what you're paying for.

You don't need to build the most complicated app on the market to create a successful business.

Sometimes a simple idea that solves one everyday problem is far more valuable than an expensive app packed with features nobody actually needs.