Product Development Process: The Seven Stages Explained
The product development process is part art, part science, and all important to the success of your SaaS.
In this article, we’ve got a comprehensive review of the entire product development process. We’ll take you through idea generation, market research, defining a minimum viable product, building new features, managing the launch, and beyond.
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- The new product development process is the method of building new products or services and bringing them to market: everything from generating ideas for a product concept to prototyping to identifying a target market, to launch, and beyond.
- While product development describes the process of creating the product itself (i.e. designing screens, writing code, running tests), product management is a broader concept that encompasses strategy, vision, and product-market fit.
- You need a range of disciplines working together in a cross-functional team to make sure various product development processes go to plan, including product managers, developers, marketers, sales, designers, senior leaders, and more.
The product development process has seven key phases:
- First up is coming up with an idea. Product managers generate these by looking at key metrics and trends in the market or gathering user feedback from existing products.
- Next up, you need to validate the idea before you start writing code. You can do that with innovations like ‘fake door tests’.
- Once you know you’ve got something valuable, you need to test your concept and plan your roadmap so you and your team have a clear strategic plan.
- Step four is building a minimum viable product. This could be a relatively low-fidelity prototype or a fully working MVP with just enough functionality to add some value to your users.
- The next phase is to gather feedback on your MVP. Use insight gathered from your first batch of users to make targeted improvements to your product before a wider launch.
- Once you’ve made enough tweaks and enhancements, you can start building your actual product. Remember that without working code – and a secure, scalable system – you don’t have a product.
- The final step is to launch your product. Your marketing and sales teams have a big part to play in making sure you roll out to your target market smoothly and drive interest on day one. Your job isn’t over – you need to evolve continually and iterate based on user behavior and feedback.
- Regardless of the context, there are some fundamental principles guaranteed to improve your workflow: align your priorities with business goals, ensure you collaborate across your cross-functional team, adopt an Agile mindset, and don’t lose focus on the importance of onboarding.
- Userpilot is a powerful user onboarding platform: leverage it to maximize the chances of product success.
What is product development?
Product development is the method of bringing a new product or service to market.
It involves all the steps right the way through, from initial ideation and research to concept development, prototyping, mass production, distribution strategy, and ultimately market launch.
The development phase of the product lifecycle is a critical one: you can get everything else right, but if the development process is flawed, your SaaS will never be a success.
Product development vs. product management
So what’s the difference between product management and the product development process itself?
In a nutshell:
- Product development describes the process of creating the product itself (i.e. designing screens, writing code, running tests).
- Product management is a broad term covering the overall strategy, vision, market fit, and all involved in ‘building the thing right’.
It’s clear where the product development process sits: it’s a part of product management as a discipline.
Who is involved in the new product development process?
“The strength of the team is each individual member. The strength of each member is the team.” – Phil Jackson
One of the most important things to understand about the product development cycle is that it’s a team sport.
You need a range of disciplines to bring a new product to life:
- Product development team: Your software engineers play an important role. They’ll choose the development framework you use, conduct software development activities (i.e. writing code and unit tests), and use their expertise to guide the rest of the team on technical feasibility).
- Product management team: Product managers set the vision, define a strategy, and build a roadmap that helps focus the team’s efforts. Without those artifacts, the product development lifecycle might lack direction.
- Project management team: The project managers’ job is to make sure development processes run smoothly: organizing resources, keeping track of work, effective process management, and resolving blockers.
- Product design team: Your user-centered design experts will gather early feedback about product concepts and help solve an existing customer problem. They also test the product concept and identify areas for improvement while collaborating with your development teams to bring designs into reality.
- Product marketing team: Communication is key in the marketing team as it will define your marketing strategy, help get messaging right for your target audience, and work with product managers to understand the competitive landscape before launch.
- Product sales team: Your sales team can help you articulate a clear value proposition, and identify your unique selling point.
- Senior management. Connect the work your team is doing with the wider business plan, set the direction, and sign off on key decisions.
What are the seven stages of the product development process?
Next up, we’re going to break down the entire process of bringing an entirely new product idea into reality.
Step 1: Carry out idea generation
“Everything begins with an idea.” – Earl Nightingale
Product managers need something they can bring to the team to start with. There are many ways to generate ideas:
Competitor analysis can help you quickly figure out if there’s a market need and start to figure out product market fit.
Tools like Google Trends and other industry publications can help point you in the right direction.
There’s no better way of generating ideas than gaining insight into a user’s perspective. Building outlets into your product so existing customers can provide relevant product and feature ideas to you and your development team
Collaboration with cross-functional teams
Customer-facing teams like the sales or customer success teams can share product ideas they’ve picked up from interacting with users.
They’ll be able to make suggestions aligned with your product strategy and serve as a useful ‘idea screening’ stage.
The product marketing team can also help as they continuously conduct market research, so they might know what competitors are focusing on and are well positioned to identify if there’s any market gap.
Having great distribution is a fantastic way to gain a competitive advantage.
Step 2: Perform product validation before the product development process begins
Before your product definition is set in stone, you should stress test it and figure out whether it’s viable. It’s key to the product’s success and helps you avoid the risk of catastrophe (i.e. users hate a concept – or it’s not technically feasible).
There are lots of ways to validate a product idea in this stage of the development process:
- Ask for initial feedback from your target audience via surveys and interviews.
- Generate interest and capture engagement with a fake door test (monitoring clicks on a link to a feature that’s not yet built to gauge demand).
Step 3: Conduct concept development and plan the product roadmap
Once you’ve validated your idea, you should work on concept development.
Alongside a roadmap (which sets out what you’ll focus on now, next, and later – a strategic plan for future iterations of the product) you need a detailed business plan outlining your financial constraints, resources, and other risks.
Planning is an often overlooked part of the production process: without it, your product features won’t be anything more than ideas.
Step 4: Build the minimum viable product (MVP)
Next up is the prototyping phase. You might want to go into a ‘lighter touch’ prototyping stage (i.e. low fidelity mockup) or you could even build a working MVP with basic features.
Put simply, a minimum viable product (MVP) is a version of a product with just enough core functionality to be usable by early customers, who can then provide feedback for future product development.
Your MVP should tackle your user’s main pain points.
This approach means product developers potentially avoid lengthy and (possibly) unnecessary work.
Step 5: Collect customer feedback on MVP and iterate
Next up, you should conduct prototyping/MVP testing to identify potential issues that need to be rectified fast.
User feedback is vital to your product development strategy.
You can test the MVP with a sample of your target market. Alternatively, if you have an existing customer base, you can recruit beta testers in-app. Talking to power users is also a good idea since they regularly use your product.
Testing will answer an important question: how are your product’s unique features performing? Have they landed with potential customers in a new market the way you’d expected they would?
You can then collect customer feedback via interviews/focus groups or a series of in-app surveys.
Remember, the more closely you listen to your target customers, the sharper your competitive edge.
Step 6: Develop the final product
In this step, you write the code to develop the final product.
Remember to analyze the feedback received from beta testing and incorporate it when developing the product – into the manufacturing process of physical products, it’s a chance to refine and avoid defects.
In reality, this is the most crucial element of the development part of the product life cycle: without a working code, you don’t have a product.
Step 7: Launch the product and continuously improve it
You’ve done all the hard work: now it’s about nailing a successful product launch.
Alongside your developers, it’s key for product managers to collaborate with the marketing team to create the go-to-market strategy.
You should be mindful of market conditions and prevailing market trends: if your competitive analysis shows a particular time of year is sensible to launch in, then tailor your launch accordingly.
Once you’ve got your launch over the line, you should continuously gather feedback and monitor product usage data. That’ll give you valuable insight into where to focus your efforts during the next new product development stage.
What are some product development examples?
Of course, how the product development process looks in practice might differ depending on the context.
Let’s explore a couple of examples.
Developing a new CRM software
CRM tools are vital in the world of modern business: managing customer relationships shouldn’t rely on a spreadsheet!
A team looking at developing a CRM might follow the stages above like this:
- Generate ideas based on observations from the sales team on their pain points, frustrations, and requirements.
- Stress test the concepts you’ve come up with by interviewing a few of the sales team and walking through your proposal.
- Prioritize and plan a roadmap of features.
- Build an MVP with the first key bits of functionality (i.e. customer information, document upload, and integration with email, for example).
- Gather feedback from beta users on the MVP.
- Use that insight to define your final MVP (i.e. a user might have issues or suggest changes to a feature you hadn’t considered).
- Launch your CRM, monitor usage, and focus on the highest value improvements (i.e. integrating with sales and marketing integrations).
Building an AI writing assistant feature for a product growth tool
AI is a rapidly growing area: what might the software development process look like for an AI writing assistant:
- Generate ideas for your tool: market research can help you pick a niche.
- A fake door test will give you an indication of whether there’s demand (i.e. people wanting to try your assistive tech out).
- Plan your roadmap: what are you going to focus on now, next, and later?
- Build an MVP of your writing tool – maybe you focus first on one specific range of edits.
- Gather feedback from beta users on the MVP.
- Use that insight to make targeted improvements (i.e. tweaking the language options to make sure they help drive growth).
- Launch your writing assistant, monitor usage, and check performance against KPIs.
Best practices to follow for developing a successful product
The product development process has several underlying principles. Here are some best practices.
Prioritize product ideas that align with business goals
Prioritization is a fundamental skill for PMs: without it, you’ll have to treat everything as a priority.
Choose product ideas based on optimizing for value realized to the business and your users.
There are many frameworks to choose from that can help you make better decisions:
- Value vs effort
- SWOT analysis
Foster cross-functional team collaboration and communication
The beauty of cross-functional teams is that each discipline brings a unique skill set to the table.
Ensure all product development refers to different team members. For example, if you were to involve engineers in your strategic planning, they can provide accurate technical estimates and help set stakeholder expectations.
Follow an agile mindset
Agile teams have a proven track record of delivering valuable outcomes, faster. Teams that build in a ‘waterfall’ style where all requirements are defined up front run the risk of getting off track.
An agile, highly adaptive, user-centric approach will set you and your team up for success.
“Agile is an attitude, not a technique with boundaries.”
Don’t compromise on the quality of the product onboarding
Onboarding is critically important. If you can’t get users to experience value fast from your existing product, the hard work you and the team put into the development process might go to waste.
Product managers should work with the marketing team to orchestrate an effective comms strategy that highlights the unique value proposition, key features, and how users can make the best use of them.
The new product development process is notoriously tricky.
Hopefully, you now feel much better equipped with a firm understanding of the key steps, principles of successful development, and some examples you can draw inspiration from.
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