What Is The Product Development Process?
The product development process is the culmination of steps to turn a product idea into a physical product ready for market. Gartner defines it as “the process of transforming ideas into valuable solutions.”
“Solutions” is a great word to describe the end result of the product development process because if done correctly, a product should be a solution to a consumer problem. A cordless vacuum solved the issue of range limitations. The selfie stick makes it easier to get a better angle for group photos. And even a taco holder stand speeds taco assembly.
While each of these solutions was novel at the time, these are all household products because their creators approached the product development process with the customer’s challenges in mind. In fact, entrepreneurs often make the best products out of their frustrations with either an existing product or not finding a solution to a consistent issue.
Can Anyone Develop a Product?
We’ve all seen Shark Tank and know anyone can create a product. Entrepreneurs, eCommerce sellers and product-focused companies all bring products to market. Unfortunately, not all product ideas succeed. Statistics show 95% of products fail, and 40% never become profitable.
A structured approach to the product development process can yield better results; however, working with a product development firm that can guide you through every phase can reduce your risk. As with most things, you can avoid making common mistakes when you learn from those who have already been down the road.
Product development firms are not all the same. Some work only with established companies, while others partner with entrepreneurs. Perhaps the biggest differences will be with the types of services they offer and the expertise they provide. To save money, time and headaches, find a firm with experts and tools specific to each phase of product development.
6 Phases of The Product Development Process
Phase 1: Ideation and Research, or The Other Way Around
Design thinking is the concept of understanding the customer first before product creation. Design thinking utilizes traditional customer research tools, but it also involves empathy – setting aside your own biases and assumptions and putting yourself into your customers’ shoes.
Harvard Business Review says, “Immersion in the customer experience produces data, which is transformed into insights, which helps teams agree on design criteria they use to brainstorm solutions. Assumptions about what’s critical to the success of those solutions are examined and then tested with rough prototypes that help teams further develop innovations and prepare them for real-world experiments.”
So, where do you start with design thinking? You imagine a customer problem and come up with an idea to solve it. How do you find that problem? If it’s from your own experience, you need to find out if others experience the same issue. If you’ve observed others who have a challenge with something or you want to find a problem to solve, you have to go to the consumer. In each scenario, research is crucial.
If you search online for the product development process stages, you will find everything from five to eight steps, and almost all start with ideation. Ideation is simply the thinking phase – coming up with an idea. But as we’ve just explained, that’s not always the first step. Plenty of people already have an idea.
Some innovators enter the process with a product idea they believe will be a winner and need to vet their idea. Others aren’t sure where to start and need to research opportunities first. You may be an eCommerce reseller looking to improve an existing product, or you may be a creative inventor who wants to come up with an entirely new product.
Either way, research is key in helping you determine whether an idea is worth pursuing. You should never develop a product based on assumptions. You need data to prove or disprove your gut instincts and guide you to a real opportunity.
Research involves consumer surveys as well as a number of tools in tandem to give you data, such as:
- How many people are looking for your product type (if any)
- How much competition you have for the same or similar product (if any)
- The price range you would likely be able to charge for your product
- The cost of having a product like yours made and the related margins you can expect (if any)
Once you have a viable, manufacturable product idea, it’s time to bring it to life through the design phase.
Phase 2: Product Design
Product design is an exciting part of the product development process. It’s where you finally get to see what your idea looks like on paper and, eventually, in a prototype. The design phase involves product designers and, depending on your product, different types of engineers. For instance, you may need an electrical engineer and a mechanical engineer to work together on the design.
Again, if you are working with a product development firm throughout the product development process, they should connect you with the right people. Be aware, however, that you may not want to work with their in-house designers. They may not have experience designing your specific product, so you could end up spending more money on revisions and still not end up with a fool-proof design.
Instead, work with a firm with a network of designers and engineers they can align you with based on your specific product. These experts will save you money, time and frustration by using best practices to avoid common mistakes.
You can expect several versions of your product. The first stage may only be a 2D sketch, then a 3D rendering, a prototype, and final design specs for the manufacturer. At each stage, you will have the opportunity to modify your design through multiple iterations until you have the exact design ready for manufacturing.
Phase 3: Sourcing
Sourcing is the phase where you locate a manufacturing partner to produce your product. They do more than produce, however. They also source product components through their own supply chain. They create the assembly process; obtain the appropriate tooling, machinery and skills; and establish testing and quality procedures.
The manufacturer plays a significant role in product quality and your profits. They are indeed a partner, working with you to mass produce your product to your specifications and standards. As with your designers and engineers, it is best to work with a manufacturer with specific experience producing your product or product type.
You may initially want a US-based manufacturer, as 78% of Americans say they prefer American-made products, but cost could be an issue. Offshore manufacturers almost always charge less than US-based manufacturers because of the cost of labor and parts.
Deciding on a manufacturer is more than just choosing the cheapest and fastest factory. It involves looking at their track record for quality, safety, compliance and reliability. Your product development partner should have a network of vetted manufacturers around the globe and can help you select the ideal one for your product and your budget.
Phase 4: Production Management
If you choose an offshore manufacturer, be aware that there will be risks and challenges. For instance, to ensure quality standards, you need to oversee production. There may be language and cultural barriers that can complicate the relationship. And if you’ve never negotiated manufacturing contracts before in that particular country, you can end up paying more than you should.
For these reasons, choose a product development firm that offers sourcing expertise and local, onsite representation so you always have eyes and ears on the process. They will oversee production management and work on your behalf to maintain a trusting relationship, keeping you updated along the way.
Phase 5: Logistics & Compliance
Shipping your products is just as important as any other phase of the product development process. There are many decisions to be made and things to consider, such as the mode of transportation, routes, packaging, labeling, quantities, timing and documentation.
If you are importing into the US or another country, you have to comply with local rules and regulations. International freight shipping has its costs and customs are another hurdle.
Logistics can be tricky, and there are plenty of ways to overpay and experience delays. Work with your product development firm to choose vetted carriers and ensure you’re getting the best pricing possible. They will also be able to help you navigate regulations, taxes and fees, and customs.
Phase 6: Supply Chain Evaluation
You may have your products in hand, but that doesn’t mean the product development process is over. Your success depends on your supply chain. You need to continually evaluate your supply chain to keep it optimized, resilient and scalable.
Through constant assessment of suppliers and vendors, you will be able to determine where you can reduce costs, increase efficiencies and speed production. This may mean sourcing your materials and components elsewhere, choosing a different factory, negotiating better pricing or finding a new shipping channel.
Your product development firm partner should be able to help you analyze your supply chain and provide expert guidance on how to maximize its potential. Choose one with global supply chain expertise and that looks at all aspects that affect performance, including the geopolitical landscape.
The product development process involves multiple teams, tools and technology, but most of all, it requires experience if you want to succeed in bringing the right product to market. Whether you’ve done this before or you’re new to product development, there is always room to learn from the best in the industry. Watch any of Gembah’s webinars to learn the intricacies of product development and how partnering with experts is the best decision you can make.