Everyone would say – identify product opportunities, define business goals, design prototype, build MVP, prepare marketing strategy for launch, and iterate product improvement.

But no one answers – How to do it;

what strategies to follow while strategizing for a product development.

Is it really something that requires meticulous planning?

Yes! This article has all the answers to your questions. It explores 

the vital elements of an effective strategy for new product 

development along with real-world examples of successful companies.

What is a Product Development Strategy

A product development strategy is a roadmap for creating and

selling new products. It helps companies understand customers

and the market, from generating ideas to product introduction. 

The aim is to satisfy customers and achieve company success.

A strong product development strategy identifies opportunities, 

sets objectives, and outlines steps and resources to turn ideas

into reality. By executing this strategy well, companies align 

efforts with business goals, reduce development risks,

and greatly increase the chances of a successful product launch.

Importance of New Product Development Strategy

 A product development strategy helps create desired and high-quality products that meet customer needs. These strategies also have the potential to positively impact society by improving lives and creating job opportunities.

 Apple’s launch of the iPhone in 2007 serves as a prime example of

their strategic product development approach. 

Their strategy involved:

1. Market understanding

2. Innovation

3. User-centric design

4. Strategic marketing

5. Efficient execution

6. Customer-centric approach

By following a well-executed strategy, Apple revolutionised 

the smartphone industry, differentiated their product, created a 

seamless user experience, and established a strong brand presence. 

This example highlights the importance of choosing a 

product development strategy that aligns with your product’s 

strengths and meets the needs of your target audience.

Some other reasons for implementing a product strategy include

1. Customer value

2. Demand generation

3. Business growth

4. High-quality products

5. Long-term planning

6. Complexity management 

Top 5 Approaches to New Product Development Strategy

Product development strategies can enhance and support

 business positions through various approaches like prioritising

 time to market, evaluating technology and market risk,

 leveraging a strong platform, incorporating customer

 insights, and internal processes to deliver optimal solutions.

1. Time-based Approach

This approach focuses on being first to market, fast following, 

or being a laggard. 

Being the first to introduce a new product category is proven 

to be advantageous and linked to long-term success. 

Fast followers capitalise on the innovator’s experiences, while 

laggards offer similar products as competitors. 

Companies benefiting the most are those that are first to market. 

For example, Apple, Uber, and Amazon. 

You can shorten time to market through techniques like an 

escalation process, streamlining product development and launch.

2. Ideation-process Approach

Emphasises generating innovative ideas through brainstorming 

sessions to address customer needs or market gaps, and seeking 

input from internal stakeholders. 

Here’s how it works:

– Customer Feedback: Collect feedback to understand customer

   needs and preferences.

– Focus Groups: Engage target customers in deeper discussions 

  to gain insights.

– Brainstorming: Encourage creative thinking within the product

  team to generate ideas.

– Internal Stakeholder Input: Seek input from internal teams for 

 diverse perspectives.

– Market Analysis: Consider market share, demographics, and

  corporate strategy.

– Improve Existing Product: Identify areas for improvement based

  on user feedback.

– Early Validation: Validate ideas through prototypes for early 

  feedback.

Product ideas are filtered based on criteria like time to market,

risk assessment, platform strength, or customer insights. This

process helps generate and prioritise concepts for further 

development.

3. Market-oriented Approach

This approach centres around understanding and meeting 

customers’ needs by conducting thorough market research and 

aligning product development with target market demand. 

It includes different types:

– Innovators create new technologies for existing markets.

– Investors in technology acquire or partner with other entities.

– Searchers find new market applications for existing products.

– Business As Usual companies focus on existing products in 

  current markets.

– Middle of the Road companies make incremental improvements

  to existing products and markets.

This approach allows businesses to align their efforts with 

market dynamics, technology advancements, and customer demands.

4. Platform-specific Approach

Develops products that align with specific platforms or technologies.

Platforms, resulting from extensive research and development,

 maximise revenue and business impact by enabling the creation

 of multiple new product offerings. 

Utilising a platform reduces engineering and time requirements 

for subsequent product variants, making innovation processes 

more efficient. It also facilitates efficient entry into new target markets

by creating derivatives within a product family. 

By capitalising on existing design work and knowledge, 

you can streamline product development and enhance your 

competitive edge.

5. Customer-oriented Approach

Places the customer at the centre of product development, 

incorporating their feedback and preferences to create products

that deliver exceptional user experiences.

Design Thinking, a popular framework, is used to deeply 

understand customers and translate insights into successful products. 

The process includes:

– Product concept generation

– Planning

– Engineering

– Manufacturing

This approach focuses on customer requirements rather than 

competitors and can be part of an Agile Product Development process.

 It may involve creating a Minimum Viable Product (MVP) for early 

 market feedback. 

CTA: – The Ultimate Guide to MVP Development [Step-by-Step]

Customer-oriented approach is applicable to both new and 

existing products, emphasising customer-centricity throughout 

the development process.

All these approaches are often combined to suit specific needs. 

The key is to select approaches that align with company 

resources, market dynamics, and overall strategy.

Here’s how to develop an effective product development strategy.

How to Develop a Product Development Strategy

Developing a product development strategy requires careful planning

and execution. 

Here’s how you can approach it:

1) Define a Vision: Establish a broad statement of where you want

   your company to be in the next 3-5 years.

2) Create a Strategic Plan: Outline the steps and actions necessary

    to achieve your vision within a 2-3 year timeframe.

3) Develop Roadmaps: Create product and technology roadmaps

    that connect your strategy to specific programs and projects. 

    These roadmaps show the progression of products and 

    technologies over time.

4) Align with Budgeting: Connect your roadmaps to the yearly 

budgeting process to prioritise future products and allocate 

necessary resources.

5) Establish Strategic Product Planning: Formulate a process 

  that links the company’s long-term vision with the strategic

  steps required to realise that vision.

6) Implement Portfolio Planning: Introduce a yearly portfolio 

    planning process that aligns with budgeting, allowing for

    systematic decision-making on product concepts.

7) Implement Ongoing Portfolio Management: Establish a

    monthly process for selecting and prioritising emerging product 

    concepts that align with the company’s strategy.

8) Link Strategy with Execution: Ensure a tight connection 

   between strategic direction and product concepts, with 

  ongoing management and planning to support successful execution.

9) Embrace New Product Development Process: Implement a

   structured approach that bridges strategy and execution,

   considering both product design and business factors that 

   shape the product definition.

Maintaining a balance between strategic planning and

ongoing management helps enhance new product 

development processes, foster innovation, and effectively 

manage product portfolios.

Tips for New Product Development Strategies

Strike Balance Between Speed and Quality

Prioritise the minimum viable product (MVP) to avoid feature

overload and focus on essential customer needs. While 

speed is important, ensure it doesn’t compromise product quality

 or user experience. 

Dedicate resources to perfecting core features that deliver

value. Implement agile testing and feedback loops to

continuously improve. Emphasis quality assurance by 

thoroughly testing for bugs and performance. Foster a 

culture of continuous improvement to refine processes and 

enhance efficiency. 

This way, you can deliver lean products that meet customer

 needs while upholding a high standard of quality.

Make Customers Part of Your Process

By prioritising customer satisfaction and incorporating their feedback, 

you can build long-term relationships and deliver 

customer-centric products that meet market demands.

Here are effective strategies to engage customers in the

 product development journey.

1. Customer as the First Step

Begin by envisioning the end result and crafting a press 

release that highlights the product’s value for customers. 

This approach keeps the customer at the forefront of your

 development process.

2.Continuous Feedback

Embrace the Agile philosophy by seeking real-time 

feedback from customers at every stage. Utilise user 

engagement metrics to gather insights without relying solely

 on customer feedback surveys.

3.Periodic Feedback

Even with a traditional approach, periodically expose users to

 the product for valuable input. Conduct surveys or user testing

 sessions to gather feedback and make necessary adjustments.

Experiment With Your Product and Strategy 

Experimentation is vital for new concept development, 

especially with Agile methodologies like Scrum because it 

facilitates rapid iteration and adaptation based on results. 

Be brave and test different features, designs, or approaches 

using A/B testing to gauge user engagement. Gradually roll 

out changes while monitoring user statistics, allowing for quick 

reversals if needed. 

Data-driven decision making, and continuous improvement 

are key outcomes of experimentation. By integrating 

experimentation into your strategy, you can optimise 

your product’s performance, user experience, and overall success.

Make Use of Your Existing Product

Often, we consider product development strategy only for

 new products, but it should also be applied to existing ones.

For example, create a new version of your existing product 

with slight changes to determine which features customers 

I would like to see improvement.

is one of the finest examples. Generative AI Search offers

 a trial of the latest version in BETA like big companies do. Google’s

After modification, if the existing market is not responding to it, 

change the idea. Undo the features that you added and 

strategize and add others. 

Find new markets. This could include targeting a different 

age group or marketing to another geographical location. 

Maintain a Realistic Product Development Roadmap

Design and maintain a realistic product development 

roadmap for successful new product ideas. 

– Use goal-oriented methodologies like OKRs or SMART

  goals to establish clear objectives. 

– Regularly revisit and adapt the roadmap based on 

  feedback and changing market conditions. 

– Communicate the roadmap to stakeholders for better

  transparency and collaboration. 

– Prioritise tasks and sequence them logically. 

– Evaluate progress, identify bottlenecks, and 

  make necessary adjustments. 

A well-defined roadmap provides guidance, manages 

expectations, and increases the likelihood of delivering

a successful product on time.

Examples of New Product Development Strategy

Here are some product development examples of brands like 

Coca-Cola, Amazon, Microsoft, Netflix that implemented product 

strategy during their new product development process.

Coca-Cola

Coca-Cola’s complete product development strategy 

revolves around prioritising the voice of the entire user base. 

By embracing consumer preferences and evolving with 

changing tastes, the company aims to thrive. They have 

introduced new products like juices, coconut water, and 

organic tea to cater to consumer demand. 

Coca-Cola acknowledges the need for beverages with 

added benefits and smaller packaging options. Continuously 

listening to the voice of the customer remains a key focus,

allowing Coca-Cola to respond effectively and meet 

consumer needs. This customer-centric approach drives their business strategy and helps them remain competitive.

 Amazon

Amazon’s product development strategy is a prime

 example of a customer-oriented approach. It begins 

by writing a simplified press release for the product, focusing 

on meeting customer needs. They then work backward from

 the press release to develop the actual product, engaging with 

customers throughout the process. 

This approach ensures that Amazon creates specific

 solutions that address identified customer pain points

 effectively. By aligning their internal process with customer

 feedback, Amazon delivers products that prioritise customer

 satisfaction.

Microsoft

Microsoft’s idea generation revolves around strategic 

partnerships and embracing emerging technologies. 

The company has shifted its focus from smartphones to AI and Cloud.

 It established a dedicated AI division and prioritised collaboration 

with open-source software. 

By emphasising innovation and leveraging partnerships, 

Microsoft differentiated itself from competitors like Google,

 Twitter, and Facebook, offering a discrete product rather 

than relying solely on user data. 

This has enabled Microsoft to stay at the forefront of the

 tech industry and gain competitive advantage over its competitors.

Netflix

Netflix employs a profit-driven strategy, focusing on 

margin growth and customer retention. By offering unlimited 

access to a vast library of high-quality original content, Netflix 

captivates viewers and builds a strong brand known for 

easy movie enjoyment. 

Its personalised user experience and seamless 

interface provides a competitive edge that is hard to replicate. 

As the largest streaming service globally, Netflix’s marketing

 strategy revolves around maximising adoption and 

retention through compelling content and a trusted brand.

Wrapping Up

By following a systematic approach and incorporating

 key elements like market research, ideation, and strategic 

partnerships, you can enhance the chances of creating 

innovative and successful products. 

Examples, such as Apple’s meticulous approach, highlight

 the importance of strategic thinking and customer-centricity.

 Continuously evaluating and refining the strategy is 

essential for long-term growth and profitability. 

So, embrace these principles, implement the tips to

 navigate the complexities of product development process 

and position your business for success.