The 5 Stages of Product Planning: a Quick Guide for Veteran Product Managers

Product planning is a crucial process that involves strategic decision-making related to the development, marketing, and distribution of a product. It’s an ongoing process that begins with an idea for a product and continues until the product is introduced to the market and beyond. Here, we delve into the five stages of product planning and offer practical tips for creating an effective product plan.

Creating a Product Plan

Creating a product plan involves documenting the above stages and outlining the strategic direction for the product. It should include a clear definition of the product, its target market, competitive analysis, pricing and distribution strategy, marketing and sales strategy, financial projections, and a timeline for product development and launch.

The product plan should be a living document, open to changes and adjustments as market conditions, customer needs, or company strategies evolve.

1. Idea Generation and Screening

The first stage of product planning is idea generation. This involves brainstorming, researching, and gathering ideas for a new product. Ideas can come from various sources such as customers, competitors, employees, or even from a gap in the market. The key is to have a wide array of ideas to choose from.

In the screening phase, these ideas are then evaluated based on their feasibility, market potential, and alignment with the company’s overall strategy. Ideas that do not meet these criteria are discarded, while promising ones are developed further.

2. Concept Development and Testing

The selected ideas are then transformed into feasible product concepts. These concepts are detailed versions of the idea, explaining the product’s intended purpose, target market, benefits, and positioning.

Testing these concepts with a small group of target customers is a critical step. This helps in understanding consumer response, which can guide the refinement of the product concept or even lead to its rejection.

3. Business Analysis

Once a product concept passes the testing phase, a detailed business analysis is conducted. This includes estimating the product’s selling price, expected sales volume, profit margin, and break-even point. This stage also involves assessing the resources required for production and marketing, and the potential return on investment.

4. Product Development

After the business analysis, the product concept is turned into a physical product during the development phase. This involves multiple steps including designing, prototyping, and testing. It’s crucial to involve cross-functional teams in this stage to ensure the product meets the quality, cost, and time-to-market objectives.

5. Commercialization

The final stage of product planning is commercialization, where the product is introduced to the market. This involves decisions related to pricing, distribution channels, and promotional strategies. The success of this stage heavily depends on a well-planned and executed marketing strategy.

Product Planning Strategy: An Example

Consider a tech company planning to launch a new fitness tracking app. The product planning process would begin with idea generation and screening, where various app features and functionalities are brainstormed and evaluated.

The concept development and testing stage would involve creating detailed app concepts and testing them with a group of fitness enthusiasts to gauge their response.

The business analysis stage would involve estimating the potential revenue from app sales and in-app purchases, costs involved in app development and marketing, and the expected ROI.

The product development stage would see the app being developed, tested, and refined based on feedback.

Finally, the commercialization stage would involve launching the app in the market with a well-planned marketing strategy.

Wrapping up

In conclusion, product planning is a meticulous process that requires thorough research, strategic decision-making, and constant refinement. By understanding and effectively implementing the five stages of product planning, product managers can increase the chances of launching successful products that meet customer needs and drive business growth.