What is Digital Product Development?

Digital products can be digital applications, platforms, or a combination of hardware and software that drive new revenue streams for an organization. The immersive experiences that digital products provide connect the dots between multiple touch points using a data-driven approach, enhancing the overall brand experience that it delivers to the customer.

What started on websites and grew into “there’s an app for that” has morphed into an entire ecosystem, an interconnected mesh of touch points between the digital and the physical. Technologies like Augmented Reality (AR), the Internet of Things (IoT), and contactless payments are prime examples of how digital products have jumped out of the screens that they were previously locked behind. Digital product development is about bringing these technologies to life.

What are Some Digital Product Development Examples?

To put it simply, we build digital products to attract customers, to generate brand loyalty through rewards and personalization, to generate useful data, and to create new revenue streams. Let’s make this more concrete by looking at an example of a digital product we launched for a convenience store customer. We partnered with a chain of conveniences stores to create a mobile fuel pay solution in their existing mobile app. Their customers appreciated that their interactions were much faster than the traditional payment process. This product ultimately added value to the experience of fueling up, making customers more likely to choose them over a competitor.

On the personalization front, our client was able to save information, such as preferred gas station location and payment information, to make future interactions easier. But that’s really just the tip of the iceberg of what’s possible. For example, by analyzing a customer’s in-store shopping trends, the app could offer personalized rewards or target advertisements that appeal to an individual’s tastes. We cannot overstate the value of the data collected through these digital products. In addition to generating insights for the marketing department, this “digital oil” is the font from which entirely new revenue streams now flow. 

Check out some of our case studies for more digital product development examples!

The Six Steps of Digital Product Development

Now that we know what digital products are, where they came from, how they’re coming to life in today’s world, and what benefits a business can gain from deploying them, it’s time to get to work. The following are some key digital product development steps to consider in creating or improving your products.

Digital Product Development Step 1: Research, Analysis

There’s nothing worse than building a solution in search of a problem. Too often, we see companies curtail or completely skip the research step because they want to launch and start making a profit more quickly. In doing so, however, they risk wasting time and resources on something that their customers don’t need and won’t use.

That’s why we strongly advocate for Human Centered Design (HCD), both in this stage and throughout the project lifecycle. It’s all about putting your users front and center. It’s about addressing a real problem or offering them real value so that they want to use the product. That means we need to look closely at our ideas, eliminate assumptions, and — most of all — listen carefully.

User interviews and surveys are great tools to build personas and understand workflows within your proposed product. We should also complement this direct user research with broader market research to quantify the size and characteristics of demand for your product. 

The next step after research is using the data that you’ve collected to perform a cost-benefit analysis. This weighs the business value of your proposed product versus the resources needed to build it and lets you know a) if pursing development of this product makes sense b) how to scope the project, and c) if there are any immediate alterations that you need to make before you get started.

Digital Product Development Step 2: Digital Product Strategy

After thoroughly considering all of the important aspects of phase 1 of the digital product development process, we move on to gathering the team and beginning the road-mapping process.

We’ll assign an individual to the product manager role and collaborate on what may be the most important artifact for the entire product lifecycle: the product brief. As a single source of truth, the product brief defines our goals, requirements, timeline, and other specifics.

This document will also contain a few other key points that we need to define during the strategy step. First, we need to think about our minimum viable product (MVP), which is a version of a new product, product redesign, or enhancement. This objective of an MVP is to enable the cross functional product development team to learn as much as possible about the product’s potential success in the market as early as possible. To enable this preliminary feedback, we strip away all the features that are just “nice to have” and boil it down to its more essential form. That’s our target, and from there we can iterate and improve. 

Key performance indicators (KPIs) are another essential part of the digital product development process. These are our most important metrics. Whether that’s repeat visits, dollar amount spent in-store, new customer acquisitions, or anything else, we need to know what outcome we’re seeking and establish a baseline so that we have something to compare it to later once we do launch the product.

Get started with our North Star Workshop! 

Digital Product Development Step 3: Product Design and Development

This is where we start building, and where design and development take center stage. One thing to keep in mind here is that user experience (UX) needs to be just as front and center as the engineering itself. UX designers will construct wireframes, consider design elements like typography, and make sure that the product’s workflow is intuitive and easy to learn.

At the same time, engineers can begin writing code, building hardware, spinning up cloud infrastructure, and taking all the other steps necessary to get that MVP off the ground.

Digital Product Development Step 4: Prototyping

Start with a prototype that’s as low-investment as possible. Focus on making something tangible, something that you can share with stakeholders and users so that you can get feedback early on that you can then incorporate.

On the UX side, this often looks like moving from wireframes to low-fidelity then to high-fidelity prototypes. For everyone else, it’s about taking that first step towards an MVP.

Crucially, a prototype lets us begin testing and integrating. Let’s say we’re building a smart home product. Not only does the code running on the device need to play nice with our custom hardware, but we need to verify that the entire ecosystem is functioning. Is data making it from the device into the cloud? Can the companion mobile app access that data? How about our data analytics platform? The sooner we can begin integrating and testing that integration, the fewer painful surprises we have down the road.

Digital Product Development Step 5: Agile Implementation

For the rest of the development process, we usually recommend following the Agile methodology. In contrast to the traditional Waterfall method that demands linear progression and strict adherence to rigid requirements, Agile prioritizes flexibility and the ability to respond to change by dividing the work in the smaller sprints and releasing products on a shorter release cycle. 

With Agile, we focus on getting to that MVP as quickly as possible, and then we iterate from there. In addition to the technical testing that we use to improve the product, we should also continue to seek user feedback. User testing is the best way to make sure that our product is genuinely helpful, making it key for hitting the adoption rates that we’re after.

Digital Product Development Step 6: Launch

Congratulations! It’s time to launch the product. A soft launch, such as with a private beta, is a great way to work through any issues while also building hype for the product. From there, in addition to the standard maintenance that’s required in any digital product, we should also continue to iterate. Use data that you collect both from the product and from user surveys to find innovative ways to improve the product. 

Why is it important to go through these steps?

It’s the same as a recipe. Neglect to proof the bread, and it won’t rise. Forget to sear the meat, and it won’t taste as good. Each step has purpose and curtailing any one of them—no matter how insignificant it may seem—has a real effect on the end product. In digital product development, this usually manifests as bugs, needing to rework parts of it, or including unnecessary features. 

By working through each digital product development phase and giving them the time they deserve, you set yourself up for success. You’ll spot problems before they become an issue, and you’ll create an immersive experience that helps your customers and drives value for your business.

Ready to develop your own digital product? Let’s talk! We can help you through the digital product development lifecycle to create seamless experiences for your customers and new revenue streams for your business.