3 stages of product innovation process
There are three stages of the product innovation process, regardless of whether a company is creating a new innovative product or making changes and improvements to an existing one.
1. Market research
Companies can do primary or secondary market research when initiating their product innovation process. The aim is to gather as much information as necessary about the tastes and preferences of potential consumers and any existing market gaps.
Primary research involves gathering first-hand information individually via various sampling methods, focus groups, questionnaires, or interviews. Secondary research is universally accessible information from previous studies. Primary research delivers specific results and is limited to the business, while secondary research is low-cost but globally available.
Ensure the following when conducting market research:
Create customer segments
Divide your customers up using their common characteristics such as behaviors and demographics. Segmentation allows you to build a marketing persona and informs your product innovation process.
Collect customer feedback
Collect customer feedback to help make informed decisions moving forward.
Think of ways to improve per customer needs
Lastly, think of ways to improve your product offering per your buyer persona and target customer needs.
2. Product development
Product development is where designers and developers build the first test product (prototype) and test it. This stage includes continuous testing and improvements to develop the final product.
Prioritize new development opportunities
Since you will never have enough time and resources for all the new product development ideas proposed, you must prioritize new development opportunities to narrow down options. Avoid choice paralysis and break down product features by viability, feasibility, and desirability. Also, score options on an effort-to-impact scale.
Build a prototype to test customer response
Test your prototype to assess its functionality and utility using a focus group to provide insight into its effectiveness and limitations.
3. Feasibility study
At this point, you must look at the legal and financial restrictions of introducing a new product to the market. Consider sales forecasts, product price, profitability estimates, and overall production costs.