Developing a new product is the cornerstone of any successful business, especially startups. You need to create something that meets the needs of consumers while also turning over a healthy profit for you.
Getting to that point, however, can be a challenge. Building a product isn’t just a matter of getting out there and doing the work - it requires time and patience to get right.
The failure rate for new products and services is notoriously high. In some quarters, it is north of 90 percent, meaning that that majority of new products on the market fail.
So what’s the key here? How can you nail your product development cycle and deliver something that will generate substantial profits?
Start By Satisfying A Need
New products don’t just emerge out of the ether - they come from the fact that they solve problems that consumers have. We already have a highly sophisticated economy, churning out millions of different goods each year for these needs. So there is a lot of knowledge already about what customers want. The market is already excellent at determining their needs and satisfying them.
Any new product, therefore, needs to fit into this context. It must understand how the market is currently failing consumers and how the new product can compete. And it needs to improve on whatever is already out there in some way.
The most successful products, therefore, aren’t always something entirely novel. Instead, they find a way to improve on an existing formula while preserving their competitive advantage.
Find Out How Much The Opportunity Is Worth
You might have an excellent idea for a niche product, but if the market for it is small, you might not make a return on your original investment.
Ideally, you want to figure out which market segments are most likely to consume whatever you build. Then you need to determine whether you will generate sufficient revenue for it to be worth your time.
User research platform, Userzoom, says that companies should try to understand the needs of users before building a new product or service and then validate prototypes. This approach helps to reduce risks and ensure that there is a feasible market out, therefore, for the products when you finally decide to scale.
Working out the size of the opportunity is, therefore, vital. You might have a product that a particular niche wants, but if there are too few people, you’ll ultimately wind up out of pocket.
Figure Out How You Will Develop The Product
The best way to work out how to develop a product is to look at how the market operates already. Look at the methods that companies already use to ship new goods and services to their customers and actually make it happen. Ask yourself the following questions:
Test Your Prototype In As Many Ways As You Can
Prototypes are an essential stage in producing a successful product. They are the point where you find out whether you will be able to deliver something the market will accept or not.
Companies tend, however, to look at their products through rose-tinted glasses. They see them as to how they want to see them, rather than how actual customers will.
Regular people are the harshest critics of what you sell. If there’s a slight weakness or flaw, they’ll find it and let you know in online reviews. Prototyping, therefore, is your opportunity to wipe out as many of these concerns as possible.
Be brutal with your product. Test it to its limits. If you find a flaw, plot a course of action to fix it. Ask yourself whether the product is robust enough, fast enough, or sufficiently flexible.
Be honest with yourself about whether it offers customers enough features, or if there are too many.
Also, question whether you can deliver it to the market on time. Many companies work to strict time constraints. There is a window of opportunity that they must exploit if they want their enterprise to thrive. If they miss it, then the profit opportunity will vanish.
A prototype, therefore, could have all the bells and whistles imaginable. Still, if it is going to take years to bring to scale, then it is not fulfilling the needs of the business. Long development cycles are often what kills new companies. The chance for the product to shine passes.
Figure Out How To Position The Product
Once you’ve designed the product and studied your market thoroughly, the next step is to position it ready for launch. Companies need to have a good sense of where their product fits alongside the other options available in the marketplace.
Positioning the product is essential and usually requires some pretty savvy marketing. For instance, is your product designed for a premium audience? Or are you looking to target people on a budget?
Does your product offer superior technology than its competitors? Or does it do the same thing, but at a lower price?
Finally, how will you use your brand image to sell the product? Will you use a value-driven approach where you talk about the broader benefits of your product? Or will you tap into different customer philosophies?
Remember, your advertising doesn’t have to focus on product features. Instead, you can simply focus on how your company makes people feel. Coca-Cola, for instance, doesn’t talk about the high sugar content of its drinks. Instead, it just associates its brand with having a good time.
Author - Chris
Author, Editor, Creator of Learn Develop Live