IoT app development process: step-by-step guide

So, you want to get into IoT app development but don’t know where to start?

Well, that’s no surprise. In the U.S. alone, IoT generated $342.50 billion in revenue in 2024 – getting a slice of that pie is a no-brainer.

But, you need to get it right. And that’s where we come in.

Here, we’ll guide you through the whole IoT app development process, from start to finish, to help you build a successful IoT app.

Let’s dive in!

What is an IoT app and how does it work?

Before we dig deeper, we’ll quickly go over the basics first – what is an IoT app? And how exactly does it work?

An IoT app is a software application that lets users interact with and control IoT devices.

Depending on your specific needs and use case, it can be a mobile, web, or desktop app.

And in a standard four-layer IoT architecture, IoT apps are part of the application layer.

source: Jelvix

But, how does this work, exactly?

IoT devices have sensors and embedded software that allow them to share data and communicate with other systems.

This data is transmitted through the support and network layers to an IoT app, where users can see it.

Crucially, this process is bidirectional, i.e. both the IoT device and app can receive and send data.

In (very) simple terms, that’s how IoT apps work – other than this, you build them like any other app.

Now, you’re probably wondering how much all of this costs – we’ll discuss that next.

How to build an IoT app: 7 key steps

Next, we’ll cover the main steps you need to follow to build an IoT app.

Validate your idea first

You should never build an app without validating your idea first – and that’s where product discovery comes in.

This process will confirm your idea is both viable and valuable.

And the best place to start is with market research.

You’ll get a deeper understanding of current market trends and growth potential.

More importantly, you’ll understand who you’re building your app for, i.e. you’ll identify your target audience.

And understanding who will use your app is crucial. 

It will help you successfully position your product in the market and stand out from the crowd.

Here’s a quick breakdown of market research fundamentals you should know about, courtesy of our Lead Product Manager, Ivan Kardum:

But, product discovery goes beyond just dry market research.

It’s also when you start building a relationship with your (potential) users.

Get feedback through surveys, user interviews, or focus groups to understand their expectations and validate the demand for your product.

Also, you need to make sure your idea is technically feasible and can actually be made.

To cut a long story short, you’re looking to answer these 2 questions:

• Can this be done?
• How can it be done?

This way, you’ll mitigate major risks that might derail development later.

And that’s how you set yourself up for success.

Key tips for idea validation

Write clear requirements

Once you’ve validated your idea, you can start defining your requirements and writing your software requirements specification (SRS) document.

And you need to get this right.

37% of projects fail because of wrong or unclear requirements, so missing the mark here has serious consequences.

Clear and well-defined requirements will help you avoid unnecessary delays and keep development on the right track.

So, what should your SRS look like? And how do you write clear requirements?

Here’s what a typical SRS document looks like:

Of course, you don’t have to blindly follow this structure and you can adjust it as much as you want.

But, 2 elements are non-negotiable – your app’s functional and non-functional requirements.

In (very) simple terms, functional requirements describe what your app does while non-functional requirements define how it does it.

Also, you should include user stories with your requirements to help your team better understand your user’s perspective.

But, what do these requirements actually look like?

Let’s say you’re building a companion app for a wearable fitness device. Here’s an example of what your requirements might look like:

• Functional requirement – The app must let users start, pause, and stop workout sessions, while providing real-time metrics on the screen.
• Non-functional requirement – The app must sync data between the wearable and the cloud within 5 seconds under normal network conditions.
• User story – As a user, I want to set a daily goal for calorie burn so that I can successfully work towards my fitness goals.

But, not all requirements are created equal, so prioritization is key.

Use prioritization frameworks like the MoSCoW method (Must have/Should have/Could have/Won’t have) to choose requirements that deliver maximum value.

In a nutshell, writing clear requirements will help you keep development on track and avoid unnecessary risks.

And that’s why it’s so important.

Key tips for requirements gathering

Pick the right hardware components

After you’ve defined your requirements, the next step is picking the right hardware components for your IoT device.

If you already have a device and you just need a companion app, you can skip this step.

But, choosing the right hardware is key if you want to build a reliable and efficient IoT device and app.

source: Particle

Here are some of the essential components you’ll need to choose:

• Sensors – temperature, motion, proximity, light sensors
• Actuators – motors, valves, solenoids, relays
• Microcontrollers – ESP32, STM32, Arduino
• Communication modules – Wi-fi, bluetooth, Zigbee
• Power management – batteries, power supply units
• Memory and storage – SD cards, flash memory, EEPROM
• Connectivity interfaces – USB ports, ethernet ports, serial interfaces
• Displays – LCD screens, OLED displays, e-ink displays
• Cameras and microphones

Of course, your choice will primarily depend on your requirements and the type of IoT solution you’re building.

Some of the factors you need to consider include the type of data your device will collect, environmental conditions, power consumption, and connectivity requirements.

For example, a smart agriculture system will require sensors that can withstand harsh outdoor conditions and have low power consumption since it operates in remote rural areas.

The good news is that you won’t need to build these components yourself and you can easily source them, unless your device is extremely complex.

What’s more, you can go with comprehensive IoT hardware solutions like:

• Arduino – has a large variety of microcontrollers and offers an easy-to-use development environment
• NVIDIA Jetson – high-performance GPUs designed for edge computing on IoT devices and running complex AI models on-device
• Particle – an end-to-end IoT platform that also offers hardware solutions like development boards and system-on-modules (SOMs)
• Raspberry Pi – powerful single-board computers that easily with a wide range of sensors and other IoT components

Also, thoroughly test all hardware components before making a final decision.

They have to seamlessly work together and meet performance requirements.

And this is key to successful IoT app development.

Key tips for picking the right hardware

Choose the right IoT platform

Choosing the right IoT platform is crucial if you want to build a successful IoT app.

IoT platforms are a key part of every IoT ecosystem. 

Think of them like the glue between the hardware (sensors and devices) and application (IoT app) layers.

source: Kaa IoT

IoT platforms allow your app to communicate with your device – and vice-versa.

But, they do more than that, too. Here’s a quick overview:

• Device management – Helping you manage, configure, and maintain your fleet of IoT devices
• Data collection and processing – Gathering, processing, and analyzing data from IoT devices
• Connectivity – Ensuring reliable communication between devices and your app using various network protocols
• Application enablement – Providing tools and frameworks for developing apps that use IoT data
• Security – Ensuring your app and device are safe from attack with authentication, access control, encryption, and compliance with security standards

In short, IoT platforms do a lot of heavy lifting in IoT app development. And making the right choice is essential.

So, how do you make the right choice? And what are the top platforms on the market?

When choosing an IoT platform, you need to consider:

• Scalability – Can it handle a huge number of devices and large data volumes without a drop in performance?
• Security – Does it offer end-to-end security and regular security updates?
• Supported communication protocols – Does it support multiple communication protocols?
• Ease of integration – Can it easily integrate with your device and app?
• Cost – Is it cost-effective and does it align with your budget?

Now, there are a lot of IoT platforms out there so you have plenty of options.

But, we recommend the following:

• AWS IoT
• Cumulocity
• Microsoft Azure IoT
• Thingworx

In any case, make sure the platform you choose fully supports your needs.

It will make building your app much easier.

Key tips for choosing the right IoT platform

Build the app and connect it with the hardware

Once you’ve got everything ready, you can start building your IoT app.

Here, your development team will take your requirements and turn them into a functional and usable app. 

Simple, right?

Well, if you’ve done the previous steps right, you shouldn’t have (too) many issues.

And the development process and deliverables are the same as for any other app:

• Frontend/mobile UI development
• Backend development
• API development

But, there is a slight difference.

You’ll have to focus more on the backend and APIs than you would for a standard app.

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Your app will need a solid backend that can reliably handle communication with your device, data storage, and data processing.

And you’ll need robust APIs to reliably connect it with your chosen platform and hardware.

So, frameworks like Node.js and Java Spring will be your team’s best friends, as will tools specifically designed for IoT development, like Node-RED.

Also, you can even build a custom backend IoT platform from scratch, if you want one that’s fully adapted to your device.

Key tips for developing your IoT app

Rigorously test your app before launch

IoT apps have a lot of moving parts and they all need to work well together.

In other words, there’s a lot of things that can go wrong.

And that’s why rigorous quality assurance (QA) and testing are absolutely non-negotiable.

It needs to be comprehensive and you need to cover every possible angle and edge case you can think of.

Start by creating a detailed testing strategy. Having a structured plan will help your team plan tests and ensure comprehensive test coverage.

You also need to decide on the testing methods. Here’s a few you should use:

• Functional testing – Makes sure each feature works as intended, especially your app’s core functionalities.
• API testing – Ensures your APIs meet security, functionality, and performance standards.
• End-to-end testing – Verifies that all components work correctly, from start to finish.
• Performance testing – Evaluates your app’s responsiveness and stability under both normal and peak conditions.
• Compatibility testing – Ensures your app works well across different devices, operating systems and platforms.
• Security testing – Makes sure user data and device interactions are protected from vulnerabilities.
• Usability testing – Tests your app’s interface to make sure it’s intuitive and user-friendly.

And that’s just the tip of the iceberg. There are plenty of other testing methods and metrics out there your team could (and should!) use.

Also, here’s a very important tip – you should integrate QA from the start.

There’s a very simple reason for that – you’ll save a lot of time and money.

Finding and fixing bugs early on in development can be up to 100x cheaper than fixing them after you’ve already launched your product.

And that’s why QA is essential.

Key tips for testing

Get user feedback and iterate

Launching your app doesn’t mean development is over – far from it.

In fact, it’s just the start.

And you need to be ready to get user feedback and iterate immediately after you’ve launched your app.

User feedback is essential for continuous improvement and iterative development.

And the best way to do it is setting up a feedback loop.

Having a feedback loop will give you a deep understanding of your users’ needs and pain points.

The sooner you get to the feedback loop, the sooner you can give users what they actually want.

Marko Strizic, DECODE co-founder and CEO

And that’s key to building a continuously successful product.

So, how can you get feedback?

You should use a variety of methods, including:

• In-app feedback forms – Feedback forms directly integrated into your app to encourage users to give immediate and relevant feedback.
• User interviews and focus groups – Direct engagement with users to get deeper insights into their experiences.
• Reviews – Your app’s reviews will help you identify issues, potential new features, and where you can improve your app.
• Analytics tools – While it’s not feedback per se, analytics tools will help you identify patterns in user behavior and understand how they actually use your app.

Once you’ve gathered the feedback, your next step is analyzing, prioritizing, and implementing it.

You should focus on issues that impact user experience first to promptly solve your users’ major pain points.

Then, you follow up with them and repeat the process.

And that’s how you build a product that lasts.

Key tips for getting user feedback and iteration

How much does an IoT app cost to build?

There’s no simple answer to this question.

Estimating the cost of developing an IoT app is tricky, to be sure. But, we can give you some general cost ranges depending on complexity:

• Basic IoT apps – Simple apps that manage a single device and have a small number of straightforward features, like turning on smart lights. Costs are typically in the range of $30,000 to $50,000.
• Advanced IoT apps – More complex apps that connect with multiple different devices and/or have advanced features like real-time data analytics. Costs jump up to $50,000 to $150,000.
• Complex IoT apps – Enterprise-grade solutions that integrate with a wide range of devices and have a suite of advanced features. Complex IoT apps can easily cost $200,000+ to build.

But, that’s just how much the IoT app itself costs – these figures don’t include the cost of designing and building an IoT device.

You’ll also need to watch out for recurring costs, like cloud hosting and data storage.

IoT app development process: FAQs

Looking for an IoT app development partner?

Do you need help building your IoT app but can’t find a development partner that’s the right fit?

Well, you’re in the right place.

We’ve got 12+ years of experience building IoT apps, so you’ll work with engineers who actually understand the challenges you face.

Whether you need a stunning companion app, a custom IoT platform, or both, we can help you take your IoT product to the next level.

If you want to learn more, feel free to reach out and our team will be happy to set up a call to discuss your needs in more detail.