Costing Digital Products Flashcards
What is a digital product?
This refers to a product that is stored delivered and consumed in electronic format
Differences in comparison physical products
- Virtually zero marginal cost as one more customer download doesn’t cost
- for overheads drivers are difficult to determine
- harder to estimate the life cycle as tech is unpredictable so costs are spread over product life
What are the four main categories of costs associated with maintaining and operating digital products Post development? (IIAF)
Functional services
Needed to execute the functionalities and features of the app
For example, push notifications, social media and chat
Administrative services
That needs to be an intuitive accessible user-friendly admin dashboard to enable effective administration of the app. These are the most difficult cost to anticipate.
Infrastructure services
Such as where the app is hosted where the data is stored and how data is delivered
IT support services
Ongoing technical support
For example to deal with iOS and android updates
