A product development strategy is a vital part of product management and product design. It includes understanding the context and constraints that product managers face when deciding about product features, pricing, and positioning. This post will help you understand what product development strategy entails so that you can create an effective one for your business.
What is a product development strategy?
A product development strategy is a way of thinking about how you are going to develop your product in order to maximize the value it creates for customers and the business. You must align a product development strategy with your business goals and should not conflict with either internal or external forces.
What is the new product development strategy?
The new product development strategy is a plan that assists the product team in meeting business goals through product innovation. There are several steps to creating a new strategy. But you should start by gaining product insights and communicating business objectives. Then you can move on to product ideation.
Why do you need a Product Development Strategy?
Having a product development strategy is essential to you. This is because it provides you with guidance on how you can develop and launch successfully new products. A strategy allows you to understand that product design is a process, not just an outcome. But, particularly, there are three major benefits.
1. It helps align the cross-functional team around the big-picture goals and priorities from the start.
A product development strategy helps you create a common understanding of the product and how it fits into business goals. Starting with a product management framework and product strategy can create a shared understanding of product goals and how it fits into the business. Without this big-picture view, you may focus on product features and miss the bigger picture.
If you and the development team aren’t working toward a common goal, you will work twice as hard to keep product development on track.
2. It provides the team with feedback and guidance for every step of the product’s development journey.
From product strategy and product management framework to product roadmapping, every product development process has a fresh flow. A strategy can help guide you through product strategy and product design. So that you can effectively manage the product’s development.
If you don’t use one, you may miss product insights and cannot communicate product goals.
Using a product development framework can help you create the right features and product-market fit.
3. It enables more efficient development.
A product development strategy provides you with a framework. This helps you decide about product features, design, and product-market fit. A product development strategy also helps you identify where product ideas come from and how to prioritize them.
When you cannot develop a product development strategy, you lose time and product value.
But to get the job done properly, you need help. Doing all these alone can do more harm than good. Don’t you know how to pick the right help? Then, we recommend you read our article Product Development Engineer: Why Do You Need One?
Types of product development strategies
There are several product development strategies that you can use to create successful products. But two of them are the key strategies. A product development strategy should result from an in-depth product management framework.
Proactive product development strategies are strategies you can implement to create a better product experience. These types of strategy include user-centered design and product discovery. They also include product roadmapping, and hypothesis-driven product development.
Reactive product development strategies are product strategies that you can use to react and adapt. These types of strategies include agile product management and minimum viable products (MVPs). They also include product pivots, enhancement, and feature prioritization.
What are the best strategies for growth and development?
There are product development growth strategies that you can use to help your business and products grow. These are the following.
This product development strategy helps you figure out what needs to be done when. It focuses on milestones, deadlines, and time-based requirements.
You can use a product development strategy to identify what needs to be done and when it needs to be done by.
With a great strategy, you can spot the best product ideas by identifying market opportunities.
This strategy helps target a specific market and product-market fit.
A product development strategy using a platform-based approach may help companies eliminate redundancies, use resources more efficiently, and offer goods to a wider audience. The goal is to develop and share essential components and to implement innovative technologies in all the firm’s products.
With this strategy, you can identify the best product ideas and create product line expansions.
Customer-oriented approach: Design Thinking
A customer-oriented strategy is a product management approach that helps you know what customers really need. This kind of approach focuses on product development and product experience. It also focuses on product usability and product design.
A customer-oriented product development strategy helps companies create better products by focusing on the customer needs and product innovation.
Key steps when creating a product development strategy
There are product development steps that you can take to create the right strategy. They include:
Before you can create a strategy, you need to find out what customers want. You must do research and focus on consumer needs.
Form your business model
Also, you can use a strategy to figure out what the business model is for their product. This will help identify key product features, elements, and product benefits.
Identify product requirements and specifications
Your product managers and you have to know what your product needs in order for it to be a success.
Create product roadmaps and product backlogs
A strategy helps you prioritize your plans. You need to create a product roadmap, product backlog, product specifications, and product features.
Set SMART goals
With a product development strategy, you must set SMART goals. These are specific, measurable, achievable, relevant and time-bound goals that you can use to develop product strategies.
Identify product risks and product limitations
With a strategy, you have the chance to identify product risks and product limitations. This will help you figure out what their product can do, as well as the product’s shortcomings.
Define actionable metrics to track product performance
You and your product manager can create product development strategies that set actionable metrics. These are the product manager’s way of tracking how their product is performing and the product’s key performance indicators.
Define the development strategy
Finally, you and your team can use a strategy to determine their product’s development approach. This will help you figure out the product’s best way forward.
What is the New Product Development Strategy Process (NPD Process)?
The product development process is a product management approach that helps you figure out how to bring their product, service, or idea to the market. This product development strategy typically includes 7 or 8 steps.
The strategy process starts with the product manager’s or owner’s idea. He has to create and validate an idea for a product, service, or product feature.
Screen the Best Ideas
Next, you need to screen the product ideas. You need to determine which idea is best for your strategy.
Product Concept Development (and Testing)
Then you can develop product concepts. You must create a product concept that is rooted in research and knowledge of the market, customer needs, and product requirements.
Develop Marketing Strategy
After you have determined that their product idea is worth pursuing, you can determine the product’s marketing strategy. This helps you figure out how to promote the product from the development stages to the product launch.
Business Potential of Proposed Product
You need to answer the product’s business potential question. You can do this by identifying product requirements and specifications, product risks, and product limitations.
Product Development Process
Then, you can use a strategy to determine the product’s actual product roadmap, product backlog, and product features. This includes how they will work productively to build, market and sell their product.
One of the last steps you can conduct is market testing. You must conduct product research, product concept testing and product pre-launch market tests that help you determine product requirements and product specifications that might lead to revising the product.
Finally, you can use a strategy to commercialize your product. This means you have to market, sell and distribute your product through all channels of distribution.
What are the stages of a Product Development Strategy?
There are usually seven product development strategy stages. These product management strategy steps typically include the following.
1. Change Existing Products Or create new product ideas
First, you must come up with product ideas. This is the first stage of a product development strategy that you can use in your product roadmap.
You need to come up with product ideas that will solve their target market’s product needs. You do this by researching, brainstorming, and product ideation.
Also, you need to find the changes an existing product needs. This step helps you change your product to match the needs of your target market more accurately.
2. Change Up Your Ideas
Next, you need to determine your product’s product requirements. This helps you figure out what changes you need for the product before it is ready for product development.
This product management requirement includes the product’s function, form, and fit. Also, this helps you determine what changes to make to your product to suit your product’s requirements.
3. Offer Product Trials
You can offer product trials in the third stage of a product development strategy. This includes testing your product’s features and benefits with a small portion of your product’s target market.
This product development strategy step is a great way to test how well-received the product will be with its customer base.
Also, you can use product trials to determine product specifications and product requirements for the product development process. This includes determining what changes your product needs to make in product development.
4. Increase the Value of Your Product
You can also increase your product’s value in the product development strategy process. This product management step is part of product concept testing and helps you figure out product features and product benefits that will give your product a value to the buyer.
5. Customization and Specialization
Customization and product specialization involve changing your product to suit the needs of different market segments. This product management step helps you figure out how to build product requirements and product specifications that will suit the needs of different product markets.
This product development strategy step is significant because it helps you differentiate the product from your product competition. Also, this will help you increase product sales and customer retention rates in the future.
You can also use product customization to sell product. You can use product customization to build product features and product benefits that will be attractive to your target market segments.
6. Create Additional Products and Product Lines
You can create product lines and product variations within your product development strategy. This includes creating new products or product modifications to make your product line more comprehensive.
This product management strategy step involves adding new product lines or product variations to your product line. So, it helps you increase customer satisfaction and meet the needs of product markets more productively.
7. Focus on Package Deals
You can choose product package deals in one of the final stages of your strategy. This product management step is part of product positioning and helps you create a product package that your product line will have.
This product development strategy step is essential because it helps you increase product sales and customer satisfaction rates.
8. Find New Market Spaces
You can also use the product development strategy to find new product markets. This product management step is part of product repositioning and helps you find new markets by modifying your product line.
This product development strategy step is important because it helps you find product markets that your product line might not reach.
How To Develop A Product Development Strategy
If you want to develop a product development strategy, you need to understand how it works. This is because such a strategy involves a lot of things, like the market and product, and an overall business strategy. Once you understand this, it is time to create one.
Questions that will help you:
- What product development strategy type do you need?
- What information should you include in it?
- How long should the product development strategy for your product take?
- Who will be responsible for each task?
- Which tasks have to come first?
Once you answer these, you can figure out what tasks you should assign to your team. Then, you can discuss with them what timeline each one needs to be completed. Once you do this, you can prioritize your needs and tasks and work on them one by one. Of you course, you need to consider its process your product needs to go through.
Once you have a strategy, you can find that it is easier for your product to develop. You can then sell the product when it’s ready.
Best practices when developing a product strategy
When you are developing product strategy, it’s important to keep in mind some best practices. These include:
- Testing new product ideas
- Staying in touch with your customers,
- Identifying product market opportunities,
- Building product development capabilities, and
- Prioritizing product investment,
- Also, neglecting the unnecessary feedback,
- Keeping a balance between the speed of creating a product and its quality
- And setting realistic goals that you and your team can achieve.
Five Tips for a Successful Product Development Strategy
If you want a product development strategy to be successful, there are five tips that you should keep in mind. These include:
- Making sure your product development strategy is attainable,
- Getting product team agreement and support for your product development strategy
- Putting the right product in front of the product team
- Making sure your product development strategy uses product information correctly,
- And considering all the factors that could affect product development.
Product development strategy: last notes
The product development strategy is a long and complex process. It starts with understanding your product and market while also considering how you want to develop it.
You can go about product development in many ways, so it’s important that you know what type of product development strategy will work for your company.
Once you have this information, developing a product management plan becomes easy because there are several steps involved in each one.