Think Hard Before Building Your Own App
As consumers’ usage of mobile devices continues to increase, more and more properties are considering adding an app to their service. Some owners and managers have decided to build their own apps. This is a complex endeavor that requires substantial time and capital investments. Real estate executives should consider the following when deciding if they should build their own app or choose a third-party vendor:
Cost to build the app
Building an app will likely cost a firm several hundred thousand dollars. You need programmers, you need someone to determine the user experience, you need someone to design the app’s screens, you need people to test the app. This “one-time” cost may not be a huge expense for some firms, but in the lifecycle of the app, it’s just a small piece of the overall cost. The app may look finished, but the real work is just beginning.
As the app is being built someone at the firm will need to be in charge of monitoring progress, testing, and taking care of tasks such as submitting the app to the App store. Granted, this person (or people) does not need to have a masters degree in an IT-related field but it will require a significant amount of time away from normal duties. Additionally, third-party firms have processes in place to take care of many of the time-consuming tasks automatically.
Maintenance of the app
Once the app is built, the work is not over. Just like a property, the app has to be maintained, features tweaked, and bugs squashed. To ensure smooth performance you need to have people dedicated to working on the app. When Apple and Android release updates to their operating systems, someone needs to make sure the app will still function properly. You likely need someone at the corporate office who is the “owner” of the app - is this a job function you want to have on your books?
Obviously if you build your own app, everything will be designed specifically to your demands. So, naturally, there is some apprehension about how well a third-party app will fit a firm’s properties, however, it’s easy to get an app that feels like “yours” without having to build it yourself from scratch. Want to use your own brand and colors? Ok! Need some unique features at your property? No problem! Want to offer another vendor’s services in the app? The right third-party will do all this and more for your unique app.
Training and support
Once the app is ready to use, someone needs to inform and train on-site staff. Obviously, since the purpose of an app is to make life simpler and be intuitive, much training shouldn’t be required, however, making sure staff knows how it interacts with current systems and what each feature does is important (note: important for engaging residents with the app -- the more the staff knows about it, uses it, the more residents will). Additionally, when questions arise, to whom will staff and residents turn? Any piece of technology needs to have a support staff in place to deal with these issues. A real estate company with its own app will need to build its own tech customer service team. Third-party app providers have a dedicated staff who are experts on all aspects of the app and available to be contacted by staff and residents alike, thus eliminating the need for extra headcount and overhead at the corporate real estate office.
What is your core competency?
Real estate firms are great at the real estate game, but by building an app themselves these firms essentially are becoming real estate and technology company. In some cases this may be the desired outcome, but in many cases this represents and requires a major shift in the company’s strategy. Will adding an entirely new department lead to returns their investors are looking for?
Creating an app is a major undertaking and has wide-ranging implications for real estate owners and managers, any decision to do it in-house should consider all of these issues.