What is Product Development?

Product development is a crucial part of business and innovation. Without effective product development, you don’t have anything valuable to offer your target audience.

Most products or services go through some sort of product development process consisting of several steps to facilitate creation, testing, and launch.

Businesses use product development to ensure their product meets the needs and wants of their customers, helping them remain competitive and grow market share.

The product development process is iterative, collaborative, and adaptable. So, what works for one product or business might not be the best approach for another.

To help you start, we’ve broken down the process into the following steps. You can apply these to most organizations and products, making them an excellent place to start.

Research and idea generation

Research is critical to product development. Before you begin developing anything, we recommend you gather as much information as possible about market trends, customer needs, and emerging technologies.

Then, you can leverage that research to begin generating ideas. Idea generation involves cross-functional brainstorming to develop innovative concepts for new products or improvements to existing ones.

Product scope definition

Once you’ve generated ideas, it’s time to define your product’s scope by determining its features, functions, and core objectives.

This is also a good time to identify what metrics you’ll use to measure your product’s success.

Clearly outlining your product’s scope helps set boundaries and provides a vision for the product.

Product roadmap creation

A is a strategic plan outlining what you’re building, why, and when. It usually includes a timeline, key milestones, and a prioritized list of features or enhancements. These should all tie back to the company’s overall goals.

The roadmap helps align teams and stakeholders on the product’s direction.

Concept prototyping

In this step, things start getting real. You’ll create prototypes or mock-ups to visualize the product’s design and functionality.

Prototypes can range from simple sketches to interactive models depending on how complex your product is and what you want to test. They enable developers to validate their ideas and spot issues early on.

Execution and testing

With a clear roadmap and working prototype, your product development team can begin the development or execution stage.

The product undergoes continuous testing and quality assurance (QA) to address issues before launch. This step can be iterative, with many development and testing cycles to refine your product.

Testing typically includes:

• Market testing: Validates the existing market opportunity and customer need that your product fulfills.
• Customer feedback: Gathers user feedback on your product’s functionality and experience prior to launch.
• Beta/functionality testing: Uncovers bugs or product usability issues.

Market entry

During the development and testing stage, your cross-functional product development team also begins planning its entry into the market.

This stage involves determining your marketing, pricing, distribution, and sales strategies. Depending on the product and market, it can be a gradual rollout or a .

Developing a product takes a village.

Product engineers and managers rub shoulders with marketers and salespeople, while designers and stakeholders bounce ideas off customer support and finance teams. Some roles might be combined, while other individuals may wear multiple hats.

A product development team typically consists of:

• Product managers: Define the product vision, strategy, and goals. They act as the bridge between the development team and other stakeholders.
• Designers: Create the product’s visual and interactive elements and typically include both user experience (UX) and user interface (UI) designers.
• Developers and engineers: Build the product using the design and technical specifications.
• Marketing and sales: Help create market strategies, pricing models, and distribution plans to promote the product.
• Customer support: Provide insights into customer needs or issues that can influence product development.
• Finance: Manage the budget, track expenses, allocate resources, and any other financial aspect of the project.
• Stakeholders: Provide input into the product development process. Their feedback and support can impact its success.

Collaboration and communication between these teams are critical, no matter how many people are involved.

Many businesses adopt agile methodologies to promote collaboration and create an adaptable process.

Product development and are closely related but are distinct in responsibilities and focus.

Product development:

• Is interested in the technical and operational aspects of product creation.
• Turns ideas and concepts into tangible products.
• Involves product developers with specific expertise, i.e., programming skills for making software products or engineering skills for creating hardware items.
• More focused on the project’s timeline, meeting the product’s technical requirements, and ensuring it’s ready for launch.

Product management:

• Defines the product’s vision, strategy, and goals.
• Involves product managers who act as the “voice of the customer,” making decisions about what to include and why.
• Should understand the product’s technology, but only sometimes needs technical expertise.
• Helps guide and coordinate the various teams involved with product development.
• Is more concerned with the product’s long-term success and maximizing its value over time.

The two roles collaborate closely, especially pre-launch. Product managers guide the overall direction, and product developers implement the product’s technical attributes. Their coordination is crucial for successful product development and launch.

If you’re in the software industry, you’ve likely encountered the “Agile methodology.”

It’s an iterative and flexible approach to product development that prioritizes collaboration, adaptability, and feedback.

An Agile approach to product development breaks down the process into smaller, more manageable increments. Doing so enables developers to share their work throughout the process and make improvements based on evolving requirements.

The stages you use largely depend on which Agile framework you choose. Scrum, Kanban, and Extreme Programming (XP) are some of the most popular, each with specific implementation guidelines and principles.

Most frameworks typically follow these key steps:

1. Backlog creation: Create a prioritized list of user stories and tasks to form the product backlog. Backlog creation helps define what your team needs to do and in what order and is refined throughout the process.
2. Sprint planning: Teams choose items from your product backlog to work on during a sprint and plan how to accomplish them.
3. Development and testing: Build the product and test its features. This stage is where you’ll create a product increment—anything you finish in the sprint ready to be delivered or deployed.
4. Review and demo: Share the completed work with your stakeholders during a review or demo to gather feedback and ensure the product meets customer needs.
5. Retrospective: Meet to reflect on performance and processes so your team can make continuous improvements and adjustments for the next sprint.
6. Repeat: Repeat the process with more sprints and build on previous ones. Continue to enhance your product based on feedback and changing priorities.

Putting your roadmap into action means translating your vision into actionable steps. Creating a plan helps align your team’s efforts and steer them towards your product goals.

Let’s review how to achieve this.

Plan the flow of your product development process

Break down your roadmap into smaller parts and prioritize and organize them into sprints or iterations.

Assign ownership to each task, set milestones, and follow your Agile framework if using. This approach gives everyone clear goals and responsibilities, but avoiding overload is important.

Focusing on fewer projects can result in better quality as team members have fewer tasks to juggle. It’s a delicate balance between having enough to work on and having enough time to focus.

A good flow limits the amount of simultaneous work in progress, reduces the number of hand-offs, and cross-trains teams for increased collaboration. This creates a cadence that supports innovation.

Create a product development strategy that focuses on customer needs

Create a customer-focused product development strategy by gathering feedback, understanding , and prioritizing features that deliver the most value.

This is where customer value chains come in handy. Ask about your customers’ wants, needs, and pain points and how easily they navigate your product. This information and your product analytics data help guide your product development.

Use data democracy to support effective teamwork

With so many people involved in product development, sharing vital information is key to alignment and success.

ensures each team member can access valuable data, while providing a clearer view of what data each team is gathering.

Encourage data-backed decision-making, hold regular meetings to share insights, invest in training, and establish feedback loops to bring data into the development process. An informed team is a confident one—great for your product build.

These three companies created efficient processes for their product development plans, demonstrating how you can adapt the process to various industries and products.

Under Armour

Connected Fitness is a network of fitness apps that frequently launch new products and features.

With its focus on athlete-driven innovation and close collaboration with professional athletes, developing new and valuable features is vital to remaining relevant. Under Amour has to keep up with emerging technologies, market trends, and user wants.

With Amplitude Analytics's help, it could iterate faster during product development by shortening the customer validation window. The Under Armour Connected Fitness team now builds and tests more features because they can measure success and learn quickly.

HubSpot

uses product analytics to create products based on user behavior.

Its product team uses actionable data on individual user and cohort behavior to iterate its product development effectively and build features to improve the customer experience.

For example, it enhanced its core product to include customer service and support solutions. Doing so meant its users didn’t need to go elsewhere for this feature, making HubSpot a one-stop shop for providing exceptional customer experiences.

letgo

While developing new features, runs A/B testing and then analyzes the results to drive decision-making.

The company has streamlined its analysis process to accelerate product development and help its team make data-driven decisions. letgo uses data to make swift product improvements and introduce new features, like in-app communication capabilities, user profiles, and ratings.

By now, your brain is likely buzzing with product development ideas, and you’re ready to get started.

But before you hit the ground running, you’ll want a few tools up your sleeve.

Product development can be a lengthy and complex journey, and these platforms can help you stay productive, collaborative, and on track for success.

Amplitude

empowers you with data and feedback to help guide your product development process.

It offers insight into your customers’ behavior and helps you understand feature adoption, user engagement, and customer retention.

With Amplitude, you can receive valuable information to help you generate ideas grounded in accurate data, develop products more effectively, and analyze existing ones for improvement opportunities.

Atlassian

Atlassian offers tools to help your agile development team stay organized and on the same page. Jira tracks bugs and enhances product optimization, while Confluence is for documentation and cooperation, Bitbucket offers version control, and Trello helps manage projects and to-dos transparently.

Productboard

Productboard streamlines customer feedback management with features like prioritization boards, insights, and user engagement tools. It consolidates feedback from different sources in one platform, enabling better insights. You can use Productboard to share data among your team to create a product roadmap.

Asana

Asana is a project management tool for team collaboration during product development. It offers templates for roadmaps, timelines, and task lists. You can also track bugs, collect customer feedback, and keep everyone focused on team goals and objectives.

Figma

Figma is a valuable tool for product development, whether you’re prototyping, conducting design sprints, or seeking team feedback. Collaborative feedback tools like FigJam simplify teamwork, even for non-designers. You can also live-prototype within the program, which is helpful for research and user testing.

Feeling inspired to build a cross-functional team and start developing some new products or features?

Well, by following the steps in this guide, you’ll set your team on course for a successful product release. Product development takes patience, persistence, organization, collaboration, and data insights—but don’t go it alone, Amplitude can help.

Tap into valuable insights and uplevel your product development with Amplitude. .

Other Product Guides