Developing new products revitalizes your business, but you can't do it haphazardly. Your product development strategy must encompass all the issues of offering something new to the market, from testing ideas to financing marketing for new target audiences. This process carries some risks, which you can weigh against the benefits.
If you keep your risk/reward analysis in mind while creating your new product development strategy, you will have a more realistic picture of your new venture.
One of the advantages of a product development strategy is that you can respond to customer needs as they change. In fact, your strategy can include customer surveys and evaluations of consumer complaints to help guide your strategy.
Making your product development strategy customer-driven can give you a strong competitive edge. While it may not be cost-effective to develop a new product for every customer need, you can identify the most common needs and develop products for those.
One of the pitfalls of a product development strategy is that customer desires can change before you complete the process. In short, you can come out with a product that customers no longer want because they have simply moved on to new desires.
You can mitigate the risks of product development by shortening the time span for your product development strategy so you get products to market while they are still in demand.
However, part of your strategy must be to constantly monitor the market so you know when a new product has come to the end of its useful life.
Your product development strategy must include benchmarks to help you measure your progress in creating a product and bringing it to market. Each of these benchmarks must have a quality component.
For example, you don't want to merely complete the working prototype stage. You want to monitor whether that working prototype achieves what you set out to do.
If you don't have realistic quality evaluations built into your benchmarks, you run the risk of developing an inferior product.
An effective product development strategy can create a culture of innovation in your company. If your strategies consistently work, you can gain a reputation as a company that is on the leading edge of your industry. This can help you capture more market share and create an expectation of exciting ideas among your customers.