The three stages of product development. How to make your product a bestseller for the people you’re targeting.

You want to realise a product idea and don’t know where to start? Then you’ve come to the right place! I’ll show you how to develop your successful product according to plan, in three phases. From zero (the product idea) to the sexy must-have product on the supermarket shelf.

Table of contents:

• How to make your product a success
• The three stages
• Phase 1: The idea phase
• Initial concept
• Phase 2: The review phase
• Market analysis
• Target group and positioning
• Legal issues
• Final concept
• Phase 3: The implementation phase
• Certificates
• Shelf life (MHD)
• Print
• Production
• What does product development cost?

Did you know that every year 80 percent of all new FMCG products (consumer goods such as food, cosmetics and cleaning products) fail on the German market?

In Germany, companies waste about 10 billion euros every year in this way.

This is also due to the fact that companies and start-ups fail to do their homework in product development.

The ideas for new products are implemented far too quickly and naively.

To prevent the same thing from happening to you, I’ll show you how you can develop a successful product with a plan and brainpower.

The success rate of new products would certainly be much higher if companies took a little more time and approached product development with a plan.

Make your products a success by following a plan.

To prevent your product from becoming one of the pitiful 80 percent of failed products, it is advisable to divide the product development process into three phases.

The temptation to skip unloved tasks is great. Who wouldn’t like to have a great product idea today and hold the first product samples in their hands tomorrow?

That way, you could start selling the new products next week and be filthy rich almost immediately. And all that without having to worry about the target group, positioning or the market.

Sounds stupid, doesn’t it? But in most companies and for many founders, it’s the standard rather than the exception.

A good product starts with an idea and then matures in the testing phase to become a real must-have for the target group.

Description of the three stages

The idea phase

The idea phase begins with the stimulus for your idea. The impulse can be, for example, a market niche that you have found.

The idea phase ends with an initial concept. This first concept describes your product idea as precisely as possible.

The big question to ask at the beginning is: What potential does the idea have? Can you earn real money with the product or will it be more of an expensive hobby?

But to be able to check this in the next steps, we need a basis.

The first concept as the basis for the market and target group analysis

In the first concept, the product idea is described as precisely as possible. The product is given a name and you work out what characteristics it should have. What could it look like and what should the packaging be like?

Will it be part of an existing brand or will it be launched under a new brand?

Do you have an idea as to where you want to sell the product and what the price should be?

The more specific you get now, the better.

If you think now about the features, appearance and packaging that the product should be known for, it will be much easier for you to identify similarities and differences in the competing products later in the market analysis.

And these differences become the unique selling points (USP) that are crucial for a successful product.

In the first concept you can freely write out how you envision the new product. Now is not the time for restrictions and “it doesn’t work like that”.

Once the first concept is written, the idea phase is successfully completed.

The review phase

Here, in the second stage, it’s about checking the first concept and polishing it like a rough diamond until it’s a real eye-catcher.

For this, you need to look at the market and set up a market analysis. The target group for the product must be defined, because only then can the positioning really strike at the core of your customers.

The Market Analysis

In the market analysis, we want to discover which products already exist on the market and which companies and brands are active in the product category.

What do the products look like, what is the package content and at what price are they offered?

What are the unique selling points of the competing products?

If you can answer these questions based on the market analysis, you will know much more precisely where your product stands in comparison to the competitive market.

Polish your product idea like a diamond

A look at the market enables you to draw many conclusions regarding the needs of your target group.

By looking at the pricing in the product category, you can see what your customers are prepared to pay. Moreover, the visual appearance and the USP of the competitive products are probably not chosen at random.

Look at competitors’ social media channels and websites to see how they address the target group.

Compare your “first concept” with the market. Are your USPs really unique? Are the asking price and package size realistic?

These market and target group insights will help you a lot with your positioning and the “final concept”.

Target group and positioning

Why do we spot certain brands and products and immediately think to ourselves: “Wow, that’s cool, I definitely gotta have that!” And then we spend a lot of money to obtain them and look forward every time to using them.

How do they succeed in casting such a spell on us?

These brands and products arouse emotions in us, their target group, and make it easy for us to identify with them.

By their positioning, they have struck the right chord in us.

They aim at our heart

In addition to the emotional aspect, it is also essential that your product offers added value for the target group. A real added value makes your target group buy again and again – soon they won’t do without your product any more.

Why should you dedicate so much time to your positioning?

As I have just described: If you can make people really want your brand because they can be part of a bigger story – like in school when everyone wanted to be in the cool gang but not everyone got in – your competitors will become irrelevant.

Without distinctive, emotionally charged positioning, people will keep “shopping” and comparing what your competitors have on offer or what price per 100 grams they call up. He who gives more for less money is the winner.

Charge your brand and your products with personal character to make them unmistakable. Because this character is their copy protection. The personal character of your brand and products is the one thing that your competitors can’t imitate.

The best venue for this is the packaging of your products. This is how you communicate to potential customers your products’ character and what they stand for.

First legal check

Do you already have a name for your product idea and your new brand? Then you should already consider the issue of trademark law.

If you are thinking about advertising your products with claims of effectiveness (e.g. “Tired was yesterday – with our tea you are just awake!”), now is the right time to check the European Health Claims Regulation.

Are ingredients used in your product that are banned or only permitted in small quantities?

And this both, from a legal perspective and from the point of view of your target group – because microplastics, for example, may not be banned by law, but could be viewed critically by your target group.

Why review the product now?

Your product is now in the penultimate step of the review phase. Next, the concept is finalised and then it goes into realisation.

In concrete terms, this means that you can still correct mistakes quickly and at low cost.

Once you have a design or a finished recipe, it costs you a lot of money every time you have to revise basics like the brand name or the ingredients.

At worst, you’ve already fully developed your product idea and even started selling it. And then, out of nowhere, a written warning drops into your letterbox and you have to stop the sale immediately – that’s the ultimate worst-case scenario!

If you review your product now, you will save yourself a lot of time and money later.

The Final Concept

At the end of the review phase, it now comes to a milestone in the product development process: The final concept.

All the findings from the market and target group analysis as well as from the positioning, flow into this. Taking into account the legal aspects, you now write down in detail how you envision your new product, which characteristics it should have and which it should not have.

With the final concept, the review phase is successfully completed. And it is the basis for the next phase, the implementation phase.

The Implementation Phase

In this phase, your product will finally come into being in a really haptic form. You will be able to hold it and eventually even sell it.

So this is the phase in which most people are off and running, immediately after they have found a new product idea.

You remember? 80 percent of products fail in the market because very few do their homework and forget to put their product idea to the test.

Now I’m sure you can see why the review phase is so crucial to the success of your product.

Brief the product developers

You’ve done your homework, haven’t you? Then you now know which ingredients and which positioning will appeal to your target group.

Ask the product development department – either internally or externally at the manufacturing company – to prepare product samples. Be as precise as possible in your written briefing.

Also give the product development department a specific purchase price for the formula. How you calculated this, and when, you can read here.

Brief the design agency

When you commission the agency to design your brand and new packaging, be sure to share all your insights about the target group and positioning in the briefing.

Provide the agency with a list of competitors so they can get an idea of the market.

To make sure you don’t forget anything when briefing the agency, it’s best to make a list. Write down everything you need.

Put the product samples to the test

At long last, you are holding the first samples of your product and the packaging in your hand. Surely, this is a moment you’ve been eagerly anticipating for weeks.

Now the product sample and the packaging have to be tested. Do they really have all the qualities you asked for in the briefing? Does the packaging hold tight and does it appear high-quality?

You should always test the samples in a larger group. It is best to bring in a few people who are not so closely involved with the product. Do you know someone who fits your target group?

Testing is then preferably done against the competition. And blindly.

Get your products certified

Certificates are an important tool to gain the confidence of your customers It usually isn’t very confidence-inspiring if a product has a “vegan” label on it that the manufacturer obviously made up himself.

The same applies to environmental labels such as “microplastic-free” or statements about organic products that do not come from an official source.

That’s why I recommend getting your products certified now that the formula and packaging are final.

Determining the shelf life of your product

Surely, you want to know the shelf life of your products. Ask the manufacturing partner to do a storage test.

Then have the stored samples tested regularly for their quality. At some point you will notice that properties are beginning to deteriorate. Until then, you can guarantee your product’s best-before date.

However, you should also observe the legal regulations, because in Germany food may not have a best-before date longer than 24 months.

Packaging printing

The initial printing of your packaging and the first production of your product are milestones in the process. Both steps require your special attention.

Is the packaging of your product an important tool to attract customers? Are there many colours and illustrations on the packaging?

Then it’s worth visiting the print shop for the press proof. Here you can often have a decisive influence on the print image. Let someone from the design agency accompany you if you are in doubt.

The first production of your product

If the product samples have so far only ever been produced on small test machines, the step onto the large machine for serial production is certainly an undertaking.

Here I recommend either being on site during production or being easily reachable by phone in case there are any queries.

But don’t worry, in most cases everything goes well and you can rely on the professionals.

What are the costs of product development?

Products, and also the costs of product development, are widely varying.

Therefore, I can’t give you any figures, but there are some cost factors in the product development process that will certainly come up. I list these points below.

What the actual sum will be, however, depends very much on the product.

Typical cost factors are:

1. designing the brand
2. designing the packaging
3. trademark application and website registration
3. product photos for online shop and advertising purposes
4. recipe development / prototyping
5. legal checks
6. testing of the product and possible adjustments
7. certification of the products and your company
8. packaging and printing costs
9. production of the product
10. storage of the product
11. dispatch of the product to the end client or to the retailers
12. marketing measures
13. listing fees from the retail trade