Introduction

Of the millions of consumers who make purchases on a daily, a vast majority of them remain unaware as to what a difficult and tedious a new product development process that each and every product had to endure before they could be in a position to place those products in their shopping carts. In order for a business or an entrepreneur to successfully introduce a product into the market, several hurdles need to be overcome and there must be a thorough understanding of the market, consumers, and competition to ensure that the product is able to fill a real demand and offer satisfaction and quality to customers. 

New product development examples always involve different steps and different complications that the business or enterprise had to face but from their struggles, a new product development process can be arrived at to help you avoid common mistakes and ensure that your product is able to penetrate the market. 

What is the New Product Development Process?

The new product development process is a systematic guide for all budding businesses and entrepreneurs that will help them come up with a customer-oriented, high-quality product that has the best chance of doing well in the highly competitive markets. In an attempt to explain new product development process, many market experts believe that there exist 6 or 7 stages of new product development process. This number however can vary based on how detailed the process is from one example to another. To know more about these stages and find out what are the 8 steps of new product development process, read on.

8 Stages of Product Development Process

It is important to understand that there is no one generic product development process and that each rendition of such a process will vary depending on the depth and detail that each explanation covers. This article explains 8 stages of the product development process and these are listed below.

  1. Idea Generation: The first stage in the product development process is idea generation. In this stage, the company comes up with many different and unique ideas based on both internal and external sources. Internal idea sources more often than not refer to the in-house research and development teams of the company and external sources refer to competitor innovations, the customer wants, distributors and suppliers, and so on. The company thereby focuses on coming up with as many feasible ideas as possible. 
  2. Idea Screening: The next stage involves the screening of this often-large set of ideas. The primary objective of this stage is to focus on ideas that are in line with the company’s customer value and financial goals. The stage focuses on the filtering out of ideas that are poor or are not feasible and retain those that have good potential. This is to ensure that the company does not face losses by moving ahead with fickle ideas that do not promise adequate returns.
  3. Concept Development and Testing: The third of the product development process steps is concept development and testing. In this stage, the good product ideas must be developed into detailed product concepts that are conveyed in consumer-oriented terms. The concept must be made in order to project the product in terms of how it is perceived by consumers and how it will potentially be received in the market and by which set of potential customers. This concept must then be tested by presenting it to the target consumers and their response must be taken into account.
  4. Development of Marketing Strategy: The new product development process in marketing is covered in stage four. In this step, the company tries to come up with strategies to introduce a promising product into the market. The company must therefore come up with the price, potential revenue figures as well as advertising and distributing channels in this step.
  5. Business Analysis: The product concept is put through a vigorous business analysis or test in order to ascertain projected sales and revenue and also assess risk and whether the production of the product is financially feasible. The company’s objectives are considered and if these are satisfied, the product is moved on to the next step.
  6. Product Development: This is the step that comes after the management of a company declares a product concept to be in line with the goals of the company and issues green light for development. The research and development wing of the company then works on the product concept for many months and even years in some cases, to come up with a working and functional prototype of the product concept.
  7. Test Marketing: This is the penultimate stage of the new product development process and involves the testing of the product and its suggested marketing program in realistic market settings. This stage provides an insight into how the product will be introduced into the market, advertised, produced, packaged, distributed, and eventually sold to the customers, and therefore any optimizations if required can be made by the company. 
  8. Commercialization: The final step of the product development process is that of commercialization. Based on the information gathered during the test marketing process, the business management may either decide to go ahead with the launch of the product or put it on the backburner. In case the go-ahead is given, the product is finally introduced into the market and this process is called commercialization. This stage often leads to massive costs in terms of initial infrastructural investments as well as sales promotions and advertisements. 

Conclusion

The primary focus of the entire product development process is to generate superior customer value and ensure that the product is well received in the market. More importantly, every company needs to properly evaluate the kind of commitment that the product production calls for and whether or not such a commitment can be undertaken by it based on the financial and administrative resources available at its disposal. This 8-stage product development process is by no means an absolute structure that makes or breaks a product but it certainly offers an excellent starting point for all businesses that are looking to launch a product into the market.

Interested to learn all about Product Management from the best minds in the industry? Check out our Product Management Course. This 6-month-long program takes place online through live instructor-led sessions. It is the only program in India that offers the ‘Bring Your Own Product (BYOP)’ feature so that learners can build their product idea into a full-blown product, and go through an entire Product Development lifecycle. Not only this, but this is the only program in India with a curriculum that conforms to the 5i Framework. Post completion, learners receive a joint certification from the Indian Institute of Management, Indore, and Jigsaw Academy.

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