You’re brainstorming with some colleagues about an idea for a new product. Before you go any further, you need to consider whether the idea even makes any sense. What would it cost to produce? Is it something people would buy? At what price? This is when product development research can help.
What is product development research?
Product development research is the process of collecting and assessing information about a new product or service. It involves both qualitative and quantitative research—everything from surveys to market analysis. Research begins with the initial product idea and continues through the stages of development to product launch.
Doing research helps you identify market trends and which type of customers you expect to reach. You can use this information to forecast product demand so you can plan a marketing strategy and sales strategy. Research also helps you understand which features customers value most and how you can differentiate your product from the competition.
Types of product development research
New product development research is done in several ways, including:
Market research
Market research starts with scoping out the size of the market for products similar to yours. Among the universe of consumers, who would buy your product? Where would it fit in? Market research is about determining your target audience.
You might start thinking of your target market in geographic terms—for example, you might want to sell nationally, or perhaps just in the Northeast or the West Coast. More likely, you’ll think in demographic terms, such as targeting the 25-to-49 age group, singles versus married couples, or households with an annual income of $100,000 or more. Identifying your target market also involves demand analysis: Would your product attract enough customers to justify the expense of the new product development process?
Market research might also include a review of the general economic and regulatory environment. The health of the economy will influence consumer demand for all products, and the level of regulatory and tax burdens may impede your business goals.
Concept testing
Concept testing involves surveys and focus groups in the target market to assess whether your product idea is appealing, then adjusting the idea and its features as needed.
Concept testing should probe target customers about how they would use your product, and whether the product solves a problem for them. Cofounders of Heyday Canning Co. Kat Kavner and Jaime Lynne Tulley found a niche in the canned foods market by canning beans with sauces and flavorings.
In an interview on the Shopify Masters podcast, Kat explains how they looked at the canned foods on the market and didn’t see anything particularly innovative, exciting, or flavorful. “It got us thinking that there seemed to be an opportunity,” she says. They wanted to combine the convenience and shelf life of canned food with novel flavorings. A typical consumer, Kat says, “doesn’t always have time to cook completely from scratch.”
Competitor research
It’s important to have data about your product’s industry, including the size, value, and number of competitors. Research and analysis of competitors establishes a basis for comparing and differentiating your product, giving you insight into how to promote any unique features that make your product stand out from the competition.
“We had this hypothesis that the canned food category as a whole was ready to be reimagined,” Kat says. “We wanted to validate that and have some good insights and data to back that up.” Her team went out and did a lot of research on the big canned food companies, identifying gaps in the market.
Pricing research
As your product takes shape and you make any modifications after customer feedback, your next research challenge is to figure out an optimal price. Surveys, focus groups and customer interviews will help determine a price customers will accept. Pricing research helps you discover which of your product’s features are valued most. The challenge is to set a price that’s not so low you miss out on sales revenue, and not so high as to deter customers or to cause them to later regret paying such a high price.
User experience
This involves giving potential customers a dry run of the product, letting you observe how they use it, and collecting their feedback via emails, text messages and social media. Do they seem satisfied in handling the product or navigating your website? User experience research should validate the success of your product development. If it doesn’t, you may need to reassess your product development research process as well as the product itself.
Product development research process
The product development research process has three stages:
1. Exploration
This is where you toss around ideas, such as how a product might look and feel, and how it would work. You’re also looking for data about your target audience—their buying habits, their preferences, and their desire for a product that solves a problem. In product development, these customer wants and needs are referred to as their pain points.
This stage includes preliminary screening of an idea or ideas. You and your collaborators can accept or reject an idea after weighing its feasibility: Would the product attract a sufficient number of customers? Do you have a budget and the technical resources to make the product? Would it be relatively easy or difficult to enter a market because of high startup costs, tough competition, or regulatory constraints?
2. Evaluation
Once you settle on a product idea and decide to move forward, you begin the evaluation stage. This is a more rigorous assessment of a product’s chance of success. You move beyond internal discussions with your collaborators, to external validation methods, such as surveys and concept testing with consumers. This involves surveying a larger sample of potential customers and collecting more detailed data from their responses.
The evaluation stage can also include further analysis of competition and how your product would fill a market niche. As you progress, you should get a more specific picture of your product and its features, and how it will appeal to customers.
3. Iteration
At this stage, the focus is on getting product details right. Use additional surveys and customer testing to make any final refinements—a process known as product iteration. Customer testing and feedback are important because your product may have changed during development, so you want customers to see the latest iteration. You want as much feedback as possible as the product gets closer to final shape and market launch.At this stage, the focus is on getting product details right. Use additional surveys and customer testing to make any final refinements—a process known as product iteration. Customer testing and feedback are important because your product may have changed during development, so you want customers to see the latest iteration. You want as much feedback as possible as the product gets closer to final shape and market launch.
Tips for product development research
Product development research has many moving parts. Here are a few tips to help keep you on track:
Keep customers involved
Continual feedback through the development process can validate your product while letting you adjust and correct so that the product fulfills user needs, ensuring customer satisfaction. Use concept testing to get user input early in the process.
Learn from mistakes
The research process is meant to let you correct mistakes quickly and get back on track. “We had gotten some complaints about our ecommerce packaging not being durable enough,” Kat says. “So we did a durability test with a new box, throwing it off the roof of my house to see if it was strong enough to withstand all of the pitfalls of shipping.”
Use your experience
Most entrepreneurs don’t step into product development cold. They often have some experience or familiarity with products similar to the one they’re developing. “We both spent about a decade in the natural food consumer packaged goods world,” Kat says of herself and her cofounder, Jaime. “My background has been more on the marketing and innovation strategy side of the industry, and Jamie is trained as a food scientist but has spent most of her career on the manufacturing side.” Leverage your expertise and consider working with a partner who has experience in a relevant field that is unfamiliar to you.
Product development research FAQ
What is the difference between research and development and product development?
Research and development is how businesses search for new ideas that can lead to new products. It’s the first step in product development, which includes designing, creating, testing, and marketing products.
What is the meaning of product development research?
Product development research means assessing the need for a product, and understanding the pain points of your target audience and how to make adjustments to the product to satisfy customer needs.
Why is it important to conduct product development research?
Research gives a product team information to make decisions in the development process, such as demand analysis, concept testing, and marketing and sales strategy. It ensures that product development is data-driven and not based on assumptions or guesswork.
