Product Development

• Product Development - is the process of developing, testing, and commercializing a product or service with the ultimate objective of solving the problem of the primary target market.
• 4 Sequential Steps of Product Development

  • Developing a product/service description
  • Creating a prototype
  • Testing the prototype
  • Validating the market
• Product/Service Description - it simply describes how a product or service works and how it benefits the customers. This is important because this will serve as the blueprint of all business operations.
• Creating a prototype of the product/service - after defining the product or service, you may now proceed with one of the most exciting but also very challenging parts of product or service development.
• Prototype - is a preliminary model or sample of a new product or service that is created to test a product concept or service process.
• Advantage of creating a prototype:

  Creating a prototype enables the entrepreneur to engage in trial-and-error; provides room for improvements and refines the functionality of the product design or service process. It is very expensive and risk-intensive to commercialize a product without creating a prototype.
• Advantage of creating a prototype:

  Creating a prototype provides the entrepreneur a window to test the performance and specifications of various materials and service processes. Every detail of the product or service should be scrutinized carefully, and all flaws be addressed right away before commercialization.
• Advantage of creating a prototype:

  A prototype helps the entrepreneur effectively describes the product or service to the product team. Members of the product team include marketing, operations, engineers, suppliers, business partners, and legal and human resources. It provides the product team the information needed to create the right product or service as planned.
• Advantage of creating a prototype:

  Creating a prototype elicits respect from key stakeholders and customers. At the same time, a prototype gives credibility to the entrepreneur. Some entrepreneurs only present vague and big ideas but no details as to its feasibility and implementation.
• Testing the Product Prototype - third step of product development.
• Testing Methods

  Focus Group Discussion - the participants will provide relevant insights about the new product or service. The objective is to identify errors, deficiencies, and issues that may impede the success of the product.
• Testing Methods

  Legality and Ethical Test - prior to launching, the entrepreneur must ensure that the product or service complies with all relevant laws and regulations and has a necessary license or permit to operate a particular business.
• Testing Methods

  Safety Test - the entrepreneur must ensure that the product is safe to use, safe to be consumed, and safe to be applied.
• Testing Methods

  Product Costing Test - the entrepreneur must examine every stage of the manufacturing process or every process of the service blueprint to evaluate and finalized the costs involved. This is the time when the entrepreneur can match the expected cost versus his or her budget.
• Testing Methods

  Component Test - each component of the product must be tested independently to identify component failures for goods or service failures for services.
• Testing Methods

  Competitor's product/service test - the entrepreneur must test a similar line of products or the competitor’s product or service itself to compare and get the best practices to be applied to the new product or service.
• Validation of Market Acceptability - is the process of finding out if the intended primary target market will be buying the product or availing the service.
• Market acceptability - is a critical factor that the entrepreneur must validate before launching the product or service, because this can strongly suggest if the business will be successful or not.
• Activities/Procedures

  • Use the most strategic marketing tool (FGD, survey, observation, interview, online survey, e-mail, or combination of these), wherein the entrepreneur can get the most relevant answers in the cheapest way possible.
  • Prepare relevant open-ended questions that answer the objectives above. Do not go around the bush and be straight to the point. Keep the questions to a minimum because the target market might get bored and not finish the whole questionnaire.
• Activities/Procedures

  • Find market experts who also target the same market but are not directly competing with the entrepreneur. The entrepreneur can leverage on the knowledge of the market expert regarding that market segment because they almost have the same demographic requirements. The entrepreneur may used these data to improved the product or service.
  • Collate all the data, analyze them, and prepare a summative report that answers the objective questions that were mentioned earlier.