With new products hitting the market daily, the need to develop better products is increasing daily. Factors like industry, product type, features, and others come into play. This is why we need an excellent strategy.
Many companies tend to focus on one product based on their customers. Some decide to provide a solution to an existing problem through their product. But no matter what, the chances are they will fail somewhere until they have a proper strategy. We can have the best idea generation and better product ideas, but it won't work much without a strategy. It process has evolved in recent years and is commonly used by dividing each step into six distinct phases. This helps to organize the process better and break down individual jobs into smaller tasks.
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What is a Product Development Strategy?
It strategy is a term that refers to all the actions and methods used when bringing new or modified existing products to market to generate new revenue and new business. Contrary to its name, this is not a one-size-fits-all strategy. Instead, it is a set of strategies, plans, and actions applied at different stages of the product development life cycle to introduce the designed product to the market and sustain growth. Its development by remaining competitive.
It refers to the entire process of bringing a product to market. It also includes the renewal of an existing product and the introduction of an old product in a new market. This includes identifying market needs, generating ideas, building roadmaps, launching products, and gathering feedback.
New product development (NPD) is at the heart of product design. The process does not end until the product life cycle is complete. You can continue to collect user feedback and iterate on new releases by improving or adding new features.
Why is Product Development Strategy Important?
Its strategy is essential because it is based on market research and analysis to develop a plan to sell the product. The master strategy includes development strategies for all phases of product development. Since research always opens up new opportunities, product development strategy is essential to selecting the best products and developing the best strategies for success in a highly competitive market. Companies with planned product development strategies can focus on strategy and succeed without getting in the way.
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Seven Stages of New Product Development Process
Developing new products and services can be a process of uncertainty. However, by following a systematic NPD process, companies can clarify and build confidence in what they are building.
The early stages of the product development process begin with the generation of new product ideas. This is the product innovation phase, where product concepts are developed based on customer needs, concept testing, and market research. The goal is to generate many valuable ideas that can form the basis of a NPD strategy. The main focus of Stage 1 is to hold brainstorming sessions where solving customer problems is a priority.
This phase is not about creating ready-to-implement ideas that anyone can do. Instead, we need to discuss raw, unproven ideas. These ideas will be finalists later. It’s a good idea to consider the following factors when initiating a new product concept:
Target Market -The target market is the consumer profile that develops the product. These are your potential customers. It is essential to be aware of this from the beginning so that you can build your product concept from scratch, centered on your target market.
Existing Product - If you have a new product concept, it's a good idea to evaluate your existing product portfolio. Do you already have a product that solves a similar problem? Or do you offer products that your competitors do not allow for market share? If so, are your new concepts feasibly different? Answering these questions will ensure the success of your new concept.
Functionality -We don't need a detailed product feature report yet, but we need a general idea of what features will be performed. Think about the look and feel of your product and why someone is interested in buying it.
SWOT Analysis - Early analysis of product strengths, weaknesses, opportunities, and threats can help you develop the best version of your new concept. This allows products to close market gaps, unlike competitors.
Scamper Method - To refine your ideas, use brainstorming techniques like SCAMPER. This method replaces, combines, fits, modifies, reuses, eliminates, or rearranges product concepts.
This phase of new product development is to select one of the ideas with the highest potential for success. Put the available ideas on the table for internal review. However, when screening for ideas, rely on people with industry knowledge and experience in the field.
Proof of concept (POC) is prioritized in NPD ideas and helps validate the idea's feasibility. There is no point in focusing on ideas that are not technically feasible. Please contact the agile development team. Their expertise helps to understand the technical aspects of things and helps to put ideas worth creating a PoC on the candidate list.
SWOT (strengths, weaknesses, opportunities, and threats) analysis is another great way to consider when choosing ideas for new development.
In SWOT analysis, agile development teams, product owners, scrum masters, and product managers perform a detailed analysis of ideas to identify ideas whose strengths and opportunities outweigh threats and weaknesses.
Concept Development and Testing
Before you start the new development process, you should prioritize creating detailed versions of your ideas and user stories.
Evaluating this value proposition is the first step in developing and validating the concept. At the very least, find problems with your approach early and allow your team to fix the course faster. This helps prevent the accumulation of technical debt.
The easy-to-follow concept development steps include:
Quantifying Gain/Pain Ratio
Conducting a Competitor Analysis
Enlisting the Major Product Features
Create a Value Proposition Chart
Market Strategy / Business Analysis
Your marketing strategy is to find a way to reach your target audience. Perhaps the best and easiest way is to follow McCarthy's 4P of marketing for new development projects.
Once your new development ideas are in place, your market strategy is documented, and your business analysis is complete, you can move on to the product lifecycle development process. NPD begins with prototype development, followed by MVP.
It focuses on creating the UI / UX of the product, which is shared with stakeholders. This helps you visualize what your product will look like and whether it complies with ergonomic best practices.
Minimum Viable Product (MVP)
It focuses on working on user stories for new products that make Agile stand out. Once designed, developed, and tested, the MVP will be released with minimal functionality. Future iterations will depend on the initial response.The best way to tackle new product development is to rely on agile product development, which focuses on step-by-step and iterative development while facilitating collaboration and communication.
This is superior to the waterfall approach because it allows you to move back and forth as new user requirements arise throughout the development cycle. Waterfall and agile development phases are similar, but their software development methods differ. The advantage of Agile is that it speeds up the software development process while maintaining communication and synchronization between development teams.
Once the MVP is complete, work moves from development to deploying the product to a live environment. This process involves adopting the DevOps culture and implementing the CI / CD pipeline.
Market Entry / Commercialization
This step in the NPD process is undoubtedly familiar to consumers. In the commercialization process, the team will do everything it needs to bring the final product to market, including sales and marketing plans. The team will start manufacturing the product and operating customer support.
Commercialization is a way to bring your product to market. The product development team hands the reins to the marketing team for the rest of the product launch and NPD cycle. After steps in this NPD process, you can market your product through the concept and have a brand voice for your business.
Tooth growth can occur in the early stages of commercialization. It is essential to analyze the logistics of your supply chain to ensure that you do not run out of products. The marketing team develops advertising campaigns to introduce new products to consumers.
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Product Development Strategy Examples
The best examples are listed below:
Amazon is an example of a customer-centric approach to product development strategies. The product strategy is ideally suited to the needs of the customer. Amazon likes to go backward from the target market. They first write a product press release and improve it until their language is simple enough for everyone to understand. The press release does not contain any technical or user interface terminology. Then work in the opposite direction from the press release to the product. This product development strategy focuses on Amazon's internal processes involving customers to develop specific products that meet specific needs.
Apple is an example of a platform / derivative strategy. They connect top-level strategies to the product development process. The tech giant is more product-driven. Apple develops products and later finds those markets. Steve Jobs is famous for not always knowing what his customers want. Apple relies on customers who pay extras for good products and tends to focus on optimizing existing products. Apple values brand loyalty, helping competitors control the market for low-priced products that compete with Apple.
Google's NPD strategies are usually technology driven. Google uses technology "to solve big problems, big times." This is a market-oriented approach. Google supports market growth for everyone who acts as a market leader. Google also optimizes growth, not revenue. Google's strategy is long-term. It is typical of a company that is always a market leader.
Microsoft is an example of a product innovation strategy implemented through partnerships. “Our industry doesn't respect tradition. It just respects innovation,” said Satya Nadella, CEO of Microsoft. The mature tech giant began a strategic transformation in 2014, abandoning the smartphone market to its competitors and investing in AI and the cloud. He created an AI department consisting of thousands of engineers and scientists. He also stopped being proactive and began to emphasize partnerships. It includes open source software and, by 2017, became a leading provider of open source code. Microsoft is unique in that it offers discrete products, unlike products whose user data is Google, Twitter, and Facebook.
Netflix maximizes recruitment and retention according to a profit and margin-focused strategy. Netflix is the largest streaming service in the world. Netflix's core service is a subscription plan that gives you unlimited access to your content. Its product strategy emphasizes margin growth. Monthly retention is an important indicator. It is increasingly focused on providing high-quality original content for gluing the eyeballs to the screen. Netflix relies on a solid and reliable brand that promises to "enjoy movies easily." Its strong brand, ease of use, and personalization make copying difficult for competitors.
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Product development and product development strategy involves several stages, from ideation to customer receipt of the product. Therefore, a development strategy is not a single strategy but a set of development strategies applied at different stages.