New Product Development Process: Steps, Benefits And Tips
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Manufacturing companies regularly develop new products to meet market demand and stay ahead of their business competitors. The development process involves conducting product research with customer collaboration and improving products to meet customer requirements. By understanding the product development process in its entirety, you can become more effective in developing new products for your business and earn higher investment returns. In this article, we define the new product development process, outline the steps involved in new product development, describe who contributes to the development process, explain what the development benefits are and review some tips for effective product development.
What is a new product development process?
A new product development process is a series of actions to research, plan, design, create, manufacture and launch a new product in the market. There can be different purposes for developing new products, such as creating superior-quality items, meeting market demand, satisfying consumer requirements, expanding to new markets and surpassing business competitors. Being innovative and regularly developing new products is a key to business success across different industries.
What are the new product development process steps?
Different companies may have specific process steps for developing new products. The steps can vary as per the purpose and functionality of the products. Some of the general steps for developing new products include the following:
identifying the current and future needs of existing and prospective customers or clients
researching similar products from competitors and analysing their quality, functionality and market impact
brainstorming ideas for new products that are likely to satisfy consumer requirements
selecting viable product ideas and creating a detailed plan to develop the new products
implementing the product development plan and making prototypes of the new products
testing consumer reactions to the product prototypes by offering them to target audience focus groups
using consumer feedback to improve product features or add new ones
launching the final new products and marketing them to the target consumers
Who contributes to the product development process?
Depending on the product, the product development process can generally require the collaboration and contribution of multiple teams. Each team may handle different development processes and may follow the directions of a project manager. The responsibility of overseeing the work of each team until product completion lies with the product manager. The teams that work to develop new products can include the following:
product research teams
product development teams
product design teams
user testing teams
What are the benefits of the product development processes?
Companies can gain the following benefits from the product development processes:
Superior quality products
The product development processes can lead companies to release superior quality products. That becomes possible because the development process involves extensive research into what the target consumers want and the companies also seek consumer collaboration in testing the products. They use the consumer feedback they get to make improvements, changes or additions in the product design, features and functionality. By creating superior quality products that meet consumer requirements, the companies can gain more local, national and international interest in their brand and products, improve their industry standing and achieve higher sales.
Increase in customer satisfaction
Satisfying customer requirements is one of the principal goals of new product development. Before beginning the product development process, companies assign teams to identify and research target groups that are most likely to purchase their products. They note what these groups want, what they use and how they use products and use this information to develop new products. After developing product prototypes, the teams gather focus groups to collaborate with them in testing the products and providing honest insights on their overall appeal and usefulness. These insights enable the teams to make better-informed decisions to create usable products.
Advanced competitive marketability
Along with its quality, the success of a product depends to a large extent on the ability of the manufacturing company to market it to its target consumers. Most companies compete in their marketing with their business rivals. Their ability to accomplish this is their competitive marketability. The product development process can help a company to increase its competitive marketability.
By conducting market and consumer research, the company becomes better placed to understand current market challenges and options and anticipate future ones. They can review the available data and make informed business decisions. They can brainstorm marketing ideas and create workable solutions to expand to new markets and gain new customers.
Tips for effective product development processes
The following tips may help you better understand the product development process and how to use the right strategies to become more effective at it:
Research the target market to develop high-quality ideas
You can use market research to support the company's product development process in the following ways:
Monitor and review market trends to determine what consumers find interesting currently.
Survey the market to identify the types of products consumers are willing to purchase.
Study and evaluate products by competitors and learn why they are or are not effective in the market.
Note the features of current best-sellers and consider how you might incorporate these in your products.
Identify your target customers, understand what they want and update or alter products to meet their requirements.
Gather customer feedback, gain insights on customer expectations and product usage and use the information to develop new product ideas.
Conduct market studies after launching the product to discover how consumers perceive it and why they are buying or not buying it.
Observe what business competitors are doing right in marketing their products and learn from their sales techniques.
Maintain a detailed record of the processes used in product development
There are two main reasons to maintain a detailed record of the processes you have used in your product development. First, it can enable you to keep track of the multiple steps you took from product ideation to product marketing. Second, it can allow you to reuse the data when you make plans to develop new products. You can do the following to keep track of product development information:
Use surveys to gather detailed information and feedback about product preferences from your target audience.
Analyse the collected data and note what consumers consistently mention about the features and challenges of the products they use.
Create different product designs and features, make these available to focus groups and find out which products consumers prefer and why.
Get feedback from focus groups at different stages of the product development process and use their insights to improve the product.
Monitor and evaluate the product sales data after you launch the product and note which marketing strategies work better than others.
Encourage customers to leave product reviews and pay attention to what they liked or did not like about the product.
Review, update and improve the product design continuously
You are likely to have better market success with your product if you continuously review, update and improve it to align with current trends and consumer preferences. It may help to do the following:
Create multiple prototypes of the product, make each prototype available to a focus group and conduct user testing on all of them.
Continue to have users test the product throughout the different stages of the product development process.
Adapt the product design, features and functionality to better suit user preferences and requirements.
Study your target consumers and create user personas based on them to understand why they might buy the product.
Use journey maps to understand how the target consumers are likely to use the products, the challenges they might face and the solutions they might seek.
Observe how the focus group uses the product during testing and consider what you can do to make the product more user-friendly.
Assess and update the final product periodically so that it continues to meet the current quality standards of your target market.
Be proactive about communicating regularly and effectively with coworkers and shareholders
Clear and regular communication is essential during the product development process to ensure that everyone remains well-informed about the different process steps and their outcomes. You can do the following for effective communication:
Discuss the product you are developing and its purpose, features and target market with the different teams.
Work with the accounting team to finalise the budget for the product development and discuss how you can make the product profitable.
Establish specific project timelines and help the teams to adhere to these and stay focused on the development process.
Collaborate with the marketing team to highlight the product's selling points for promotional purposes.
Direct the sales team to explore different and more effective marketing techniques and strategies.
Share product information and updates frequently with the company shareholders and get their feedback.
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