When starting the ideation process for a new software product there are some rudimentary steps and understandings that must be clearly understood and mapped out. Planning a product is a dynamic and ongoing process that starts with identifying the product market requirements.

Product planning is the process of creating a product idea and following through on it until the product is introduced to the market. The product planning stage is where you start to discuss and determine the products price, distribution and promotion.

Plan for Product Failure

If you are working for a small “one product” company and planning to build a single product you must prepare an exit strategy in case the product does not perform as expected or worse, it does not sell at all. This might sound a little gloomy or negative but it is important to be honest from the outset when entering into this type of business endeavour.

Deploy in Multiple Market Segments

The biggest mistakes are made at this stage of the product lifecycle planning. Use your time to leverage your product for different and varied market segments.

Do not relay on a single customer or market even if it is the pitch that you used to secure product funding. Release different product names that are focused on different markets. Try different angles and seek new usage models. Do not wait until time and money are running out.

Good product planning involves managing the product throughout its life, employing multiple marketing strategies, upgrading the product and adding product extensions. You must also plan for increased product distribution, price changes and the costs involved in marketing and promotions.

Developing the Product Concept

The first step in the product planning process is to develop the overall product concept. The marketing and sales managers interact directly with customers and are in a perfect position to identify specific problems and short coming with the currently available product solutions in the market. The different stakeholders can then come up with new ideas that both solve the problems that exist and better provide for the customers needs.

Remember to use the five phase approach for problem solving and make sure to maintain a small focus group to monitor the products refinements.

Study the Competition

The next step to study the competition. You must perform a market analysis and provide details on the key competitors detailing their market shares. Once you understand the competitors in the market place you can then effectively identify potential advantages that your proposed solution will provide and identify areas of opportunity. Make sure to include in your market research products that are indirect competitors to your suggested product solution.

Small companies should endeavour to performing both qualitative and quantitive market research for the new product proposal. Quantitative research is important for understanding the different aspects of a market and includes such aspects as, what kinds of customers making up the market.

Initial Product Offering and Distribution

Once the market research and subsequent findings have been digested and fully understood, its time to decide on a product release model. When releasing a software product a good place to start is to target potential customers that use competitor solutions. Opening a small booth at a relevant trade show that focuses on the product specific field of expertise.

A great method of creating a unique leverage point is by creating joint development ventures with trial customers by solving specific problems or providing customised solutions tailored to their specific needs.

Leveraging the Technology to Solve Problems

It’s important not to put all of your eggs in one basket as you never know what the future holds. It is important to keep an open mind and to emphasise that you may need to shift your target market or rebrand your products overall direction. What I mean by this is, many very successful products started out focused on a completely different market sector and were renamed, retooled and re-marketed once it was understood that they perfectly solved another previously unseen problem in a completely different market sector.

The Products Lifecycle

Part of the product planning process is understanding that products go through various stages in the product life cycle. These stages include the introduction, growth, maturity and the product decline stages.

Sales usually start strong during the growth phase, when competition is low. Once the product exposure increases this will cause competitors to show interest and offer alternative solutions and products of their own. The introduction of competition may force a company to lower its prices. By lowering the price the company may be able to retain its market share. Another strategy is to focus further development of the product and build “unique features’ that will help differentiate your product from the competition. These unique identifiers are where your marketing team can create selling points and market pitches.

Stage 1 – Product Introduction

The first stage for a new product is introduction, this is when the company promotes the new product. The main goal of product introduction is to attract the customers attention and confirm the products initial exposure and distribution. There is generally no competition at this stage of the game, so that main effort should be focused on getting the word out, engaging potential customers, searching out partnership ventures and exposing the technology in every possible way imaginable.

Stage 2 – Market Acceptance and Growth

The second stage is growth. In this stage, the new products has hopefully been accepted into the market and sales and profits have begun to grow. The product is now exposed to the market and the competitors are now beginning to offer competitive product solutions. So, its now time to promote product quality and emphasise the unique features that differentiate it for the competition.

Stage 3 – Product Maturity

The third stage of a product’s lifecycle is the maturity stage, where the products profit cycles reach their peak. At this stage the competition is fierce. Companies go out of their way to provide extremely high quality products and related services at lower prices. They are constantly jamming in additional features and functions into the product to retain their existing customer base and entice new customers to maximise profits.

A well managed product life cycle helps a company or brand maximise profits and stay in the markets for as long as possible.

Conclusion

I hope that I have been able to shed some light on how to plan your products lifecycle. Don’t forget that there are general rules of thumb but, this is not an exact science. There are always exceptions to the rule. As long as you keep your ears and eyes open to your customers needs and wants you should be able to navigate the labyrinth and create a profitable product. And, on the topic of understanding real customer needs, I’ll leave you with a quote:

If I had asked people what they wanted, they would have said faster horses. Henry Ford