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NEW PRODUCT DEVELOPMENT

8 Steps of New Product Development


New Product development is a journey. It’s the road which leads to the actual product and then the actual product to the market. Every product goes through a number of stages before being introduced in the market.


Idea Generation

The first stage of the New Product Development is the idea generation. Ideas come from everywhere, can be of any form, and can be numerous. This stage involves creating a large pool of ideas from various sources, which include –

  • Internal sources – many companies give incentives to their employees to come up with workable ideas.
  • SWOT analysis – Company may review its strength, weakness, opportunities and threats and come up with a good feasible idea.
  • Market research – Companies constantly reviews the changing needs, wants, and trends in the market.
  • Customers – Sometimes reviews and feedbacks from the customers or even their ideas can help companies generate new product ideas.
  • Competition – Competitors SWOT analysis can help the company generate ideas.

Idea Screening

Ideas can be many, but good ideas are few. This second step of new product development involves finding those good and feasible ideas and discarding those which aren’t. Many factors play a part here, these include –

  • Company’s strength,
  • Company’s weakness,
  • Customer needs,
  • Ongoing trends,
  • Expected ROI,
  • Affordability, etc.


Concept Development & Testing

The third step of the new product development includes concept development and testing. A concept is a detailed strategy or blueprint version of the idea. Basically, when an idea is developed in every aspect so as to make it presentable, it is called a concept.

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All the ideas that pass the screening stage are turned into concepts for testing purpose. You wouldn’t want to launch a product without its concept being tested.

The concept is now brought to the target market. Some selected customers from the target group are chosen to test the concept. Information is provided to them to help them visualize the product. It is followed by questions from both sides. Business tries to know what the customer feels about the concept. Does the product fulfil the customer’s need or want? Will they buy it when it’s actually launched?

Their feedback helps the business to develop the concept further.

Business Strategy Analysis & Development

The testing results help the business in coming up with the final concept to be developed into a product.

Now that the business has a finalized concept, it’s time for it to analyse and decide the marketing, branding, and other business strategies that will be used. Estimated product profitability, marketing mix, and other product strategies are decided for the product.

Other important analytics includes

  • Competition of the product
  • Costs involved
  • Pricing strategies
  • Breakeven point, etc.

Product Development

Once all the strategies are approved, the product concept is transformed into an actual tangible product. This development stage of new product development results in building up of a prototype or a limited production model. All the branding and other strategies decided previously are tested and applied in this stage.



Test Marketing

Unlike concept testing, the prototype is introduced for research and feedback in the test marketing phase. Customers feedback are taken and further changes, if required, are made to the product. This process is of utmost importance as it validates the whole concept and makes the company ready for the launch.

Also Read:  Direct Marketing - Definition, Types, Strategies & Examples

Commercialization

The product is ready, so should be the marketing strategies. The marketing mix is now put to use. The final decisions are to be made. Markets are decided for the product to launch in. This stage involves briefing different departments about the duties and targets. Every minor and major decision is made before the final introduction stage of the new product development.

new product development

Introduction

This stage involves the final introduction of the product in the market. This stage is the initial stage of the actual product life cycle.



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  • Avatar harsh says:

    The information is going to become very helpful for me.

    Thank you.

    • Avatar Aashish Pahwa says:

      Hello Harsh,

      We are glad that you liked our article. You can subscribe to the email newsletter to get such articles in your email.

  • Avatar AWOFISOYE Abiodun says:

    I need your assistance in the area of Marketing strategy and Product/service Management as these are area of my specialization in marketing
    I’m a graduate of Marketing management @ higher institution
    I have written several professional exams in Marketing
    I need to develop myself more
    Please offer any assistance in achieving these enormous tasks ahead
    Your reply shall be appreciated
    Thanks Boss

  • Avatar Salar baig says:

    Clean n clear picture of value creation its retention, delivery and change has been mentioned in the writing .
    Fabulous!

  • Avatar shunyom says:

    Appreciate your work on this. Simplified approach

  • Avatar TRACY OONTSE says:

    The information is clear and easy to understand.
    100%

  • Avatar md farhan says:

    It was helpful for me

  • Avatar Jaysree roy says:

    Thank you for giving very nest and clean view of the topic

  • Avatar Upali Ranjith says:

    Very good process of product development. I followed almost same process in my office. Thank You.

    Upali Ranjith

  • Avatar Chukwuka Ahalonu says:

    Quite insightful. I’ve developed & still fine tuning some products at the model level. Please I will need your candid input, criticism & opinion on the overall management & viability b/4 introduction into market. Thanks. Chukwuka A.

    • Avatar Aashish Pahwa says:

      Thanks, Chukwuka!
      You can connect with us using the contact form. We’ll be more than happy to help you.

  • Avatar Hari Krishna says:

    I need some products to develop with cheap and best

  • Avatar ADAMS ALHAMEED says:

    That’s a great definition / analysing term
    THANKS!

  • Avatar Tsymbals Design says:

    Good information. I would add a paragraph about prototype design and 3D models, however.

  • Avatar Neha singh says:

    Thank you for this …

  • Avatar Adis says:

    great insight ‘
    God bless you

  • Avatar Dingle says:

    Thank you very much, article very helpful

  • Avatar Mohamed says:

    thank you so much for you explanation

  • Avatar Hugo Delgadinho says:

    really interesting process.

  • Avatar Jeevitha Andi says:

    It is very usefull

  • Avatar Ketsaal Retails LLP says:

    Very educational content and written well for a change. It’s nice to see that some people still understand how to write a quality post.

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