Making the right decisions throughout the product’s evolution is a tough pill to swallow. The solutions to the cracks in your product may differ hugely, depending on the stage of the life cycle. That's why, it's becomes essential to keep a watchful eye on your product at every phase of its evolution.
What is the product development life cycle and why is it important?
In IT, the product development life cycle is the timeframe from the product development and its market launch until the decrease in sales and the eventual removal from the market. The approach is used by Product Owners, Project Managers, and the executive suite to manage the product's presence and its success on the market.
Why is it so important to manage your IT product in time? The current phase of a particular product directly influences the budget, project schedule, and management approach.
From defining KPIs and the direction of development through maintaining user interest and understanding the reasons for sales decreases, you may need adjustments every step of the way.
What’s more, digital products are created in a very complex and fast-changing environment. Nowadays, we experience rapid changes in technology, and users’ needs and expectations that directly influence IT products. Not to mention the high level of innovation and competitiveness that makes the whole product life cycle even more complicated. All of these prove a great challenge for digitally-oriented companies to address while standing out on the market at the same time.
An individual approach to each stage of product development and its respective challenges gives you the assurance that you allocated the budget in the best way and reduced unnecessary costs. What is more, if you apply the correct strategy, your product will be on a fast track to fulfilling the current needs of your business and end-users. Let’s look at the different life cycle phases for IT products and what your teams should remember when entering each of them.
IT product life cycle phases – what should you know?
In the IT product life cycle, we find five main phases defined by sales in time. For each one of them, you should be able to apply a different management approach depending on the most pending business needs:
- Development is an initial phase of your product where you focus on investing in it and laying a solid foundation for launching it to the market later.
- Introduction to the market is characterized by rather small but growing sales.
- Growth is a phase of constant product improvement with sales growing very quickly.
- Maturity is the time for maximizing the return on investment (ROI). The sales revenue is usually the highest in this phase.
- Decline is the last phase when sales and revenue keep decreasing, unless you undertake corrective measures.
During each of the phases, you may use your own teams or outsource some services to an external partner.
|Development (initial phase)||Introduction||Growth||Maturity||Decline|
|How can a tech partner like Merixstudio help you?||Conducting product design workshops that’ll focus the development team’ efforts on fulfilling business and users' needs.||Validating the assumptions together and making the right decisions regarding the following versions of the product.||Support in adding new features to the product backlog and prioritizing them.||Collaboration with a team that supports you with maintenance, new features, and software modernization.||Complex software modernization encompassing UX and tech changes.
When your digital product is in the initial stage, you may be struggling with defining KPIs and the direction of development. To develop a concept of the application and plan its growth, you will need a reliable team with experience in creating digital products. To that end, companies use in-house teams or rely on external software partners.
If you don’t have people or resources to develop the product in-house, you can use team augmentation or dedicated team cooperation models. Qualified experts can support you in defining business goals, end-user needs, and all the tech requirements that you may not even be aware of, but are necessary to launch the application. It’s also a good time to validate your initial ideas about the product. Outsourcing the development work to software professionals, if it’s beyond your teams’ skills, also means you can reap the time-to-market gains that could be lost had it been done in-house.
When collaborating with external experts, make sure the outsourced team has enough knowledge to kick off product development. Depending on your needs you can be engaged in workshops and product discovery that help the project team recognize and understand the value proposition, key stakeholders, and other essential aspects of your digital product.
If you already know some of your business and users' needs, you can take part in scoping sessions to define the high-level project plan. At the development stage, it pays off to know the product's key performance indicators (KPIs) to be able to identify when the product becomes successful. Measuring product metrics is essential for its growth and team engagement in achieving the goals.
During development, defining the relations with all stakeholders is key. Determining their level of influence on the product will help you and the team to create a successful solution. You may create the product for doctors, but your end-users may be nurses and receptionists as well. Every group of end-users may have a common overall goal (making the appointments on the calendar). However, they might have different expectations for the way of achieving this goal.
|Receptionists' expectations||Doctors' expectations|
“As a receptionist, I want to quickly find the nearest available dates for medical appointments in the clinic.”
The appointment finder should:
“As a doctor, I want to find the nearest available dates for medical appointments on my calendar.”
The appointment finder should:
The doctor doesn’t need to see all calendars in the clinic. If the patient has any complex request, they should contact the receptionist.
It’s worth recognizing all the potential users that may affect the product and the way it’s utilized to avoid complaints and increase usability.
After the main development phase, it’s time to introduce the product to the market and your customers. We launch the MVP version, which fulfills the business needs we defined in the initial phase. After the product implementation, we collect feedback from end-users and the market. It helps us validate the idea further and adjust the next business and development steps.
According to the State of Early-Stage Startups 2021 Report, 88% of founders validated their idea with end-users and 87% of founders plan to validate it.
Once you and your team define the priorities for product requests you want to address, you can move forward with the next version. Want to see how building a functional MVP helped a fleet management startup achieve their product goals? Check out the Autium case study!
In the growth cycle, you constantly consider the feedback from the market and end-users and address those in your product. Usually, this stage holds huge potential for boosting your solution’s market share, as long as you and your teams consider the feedback from end-users. That’s why your teams should collect all user comments, try to understand them, and find the best way to implement those requests, provided that they support the product’s usability. This is what Alexis Wicén, the CEO and co-founder of Unibo, had to say about gathering user feedback.
User feedback is critical if you want to improve the product all the time.
That said, user requests are not always possible to implement — and often for good reasons.
Aside from the solution’s usability and its legal compliance, setting the right priorities in the backlog may have a considerable impact on your solution’s growth. That’s why, once your team collects and assesses the feedback from users, they should plan the improvement of designs and processes by adding prioritized ideas to the product backlog. When doing that, make sure they refine those in detail before any sprint.
The growth phase usually entails team scale-up alongside the business expansion. Once the number of teams increases, you’ll have to deal with many areas that may be affected. For example, the complexity of communication grows, workflow challenges may appear, and you may need to set clear and simple goals for all the teams. More importantly, while your product keeps evolving, it may exchange many hands and accumulate some level of unaddressed tech issues that negatively affect user experience.
Before your product moves forward to the maturity phase, make sure you’ve kept an eye on the technical debt and its repayment. This is an important step because every digital product has to deal with code debt. If you don’t repay it, you will have to cope with a long time of delivering new functionalities, and most likely, you’ll lose an opportunity for dynamic growth and stability.
The maturity phase is when the product is stable and earns you the most. To maximize the revenue and return of the investment at this stage, you should constantly maintain user interest in your digital product through well-thought-out features and accretions that respond to users' needs. With this goal in mind, make sure your development team focuses on proper maintenance. This way, you’ll be able to eliminate existing bugs and implement the necessary design and process improvements, without which your product would not be as stable.
While maintenance is an inherent part of development in every phase of the product life cycle, it’s definitely the main goal of the maturity phase.
It pays off to have a software partner with a maintenance contract adjustable to your needs. This way, the project team doesn’t have to focus only on maintenance — they can still develop new features. To make it happen, use scoping sessions to help the development team identify the direction of the product, key business values, and goals the product needs to fulfill.
Depending on the market, we still need to stay focused and be well-prepared for legal changes that affect the business. If you have a product that provides tax settlement, your app has to be up-to-date with every small change in the law. If the product isn’t aligned with these, it will likely go to the next and the last phase.
The decline cycle brings with it efforts to understand the reasons for decreasing sales. While no one wants to be in this phase, even if it is inevitable, many end up anyway sooner than expected. Fear not, though! If previous phases went as expected, at this stage, you should already have enough funds and priceless experience to start your next journey with a new digital product.
The transition to that phase may speed up if your digital product deals with various difficulties like increasing costs, decreasing security, compliance issues, and losing that crucial competitive advantage. The main reasons for ending up in this phase are:
- An out-of-date product that lacks legal compatibility,
- Poor product usability,
- New trends on the market not addressed in the product,
- Legacy code,
- Outdated tech stack and the app’s information architecture,
- Lack of time for tech and UX-UI maintenance.
If you forgot to keep your digital product updated not only on the business but on the technical and UX side as well, it will probably need some adjustments to not be completely rejected by the market and users. In terms of the above, you can focus on your software modernization which offers complex solutions in the code, architecture, tech stack, and user experience.
As a software partner, we can help you deal with the software modernization in your legacy code with three different approaches:
- Lift and shift by moving product to the cloud without any change in architecture and with minimal disruption to the code.
- Augment and refactor by moving product to the cloud with major changes in your app code.
- Complete rewrite by rebuilding the app from scratch.
Software modernization can be a great journey of product transformation that, in the end, can lead your organization and product to grow again.
Now that we know what to watch out for in different IT product phases, let’s take a look at how industry leaders do it.
Product development - business examples
Facebook and Netflix both went through profound transformations over the years that expanded their market reach.
One of the biggest social media apps, Facebook, is not the same product as it was when they introduced it to us a long time ago. At the beginning of the life cycle, this product was designed for college students to keep them more connected. As it grew, the Facebook team created a social app that was frequently used to share holiday photos, music, and thoughts all over the world. While some users utilize these functionalities today, Facebook saw the potential in new trends moving forward.
In the meantime, they propagated some solutions from Instagram, like stories that allow users to create engaging content with funny filters and effects. Nowadays, they focus on completely new features that are tailored to users' needs, like the Marketplace, social groups for local communities, and hobby sharing. So, they found another reason for users to stay with them – or maybe they just answered our hidden desires? To share and gather knowledge on hobby groups, that is, or perhaps just to sell redundant stuff to the local community. What’s more, with the widely announced near launch of a multisensory metaverse, who knows, maybe Facebook has yet another ace up its sleeve?
Another example of product transformation is Netflix. The Netflix brand was initially created to provide DVD rental via postal services. With time passing and the user market changing, it evolved to become a streaming platform and transformed its business value into a digital product known worldwide.
Netflix's subscription video-on-demand (SVOD) services respond to the trend of moving away from scheduled TV broadcasting towards online on-demand streaming reflective of users' needs per given moment and their increased online presence.
What is more, Netflix responded to the changes dictated by the 2020 pandemic. When Covid-19 broke out, social distance was an essential element for all communities to keep the infection away. During the pandemic, Netflix answered those needs and launched “Netflix Party” with a Chrome extension, which allowed users to watch series together even when they weren’t in the same place. Thanks to the chat, they could comment on the current scene on the screen.
Additionally, Netflix has a strong referral program, which is their main competitive advantage. They created an algorithm that recommends users movies and series tailored to their preferences based on their interests and recent shows they had finished watching. The algorithm is based on artificial intelligence and machine learning. Improving the referral program allows Netflix to keep users interested in the app. It helps Netflix to present valuable titles to users because there is no way they would go through three or five thousand titles on their own to choose the desired one.
Another new arrival on Netflix to keep the interest of its customers is mobile games. Users can download the game from mobile shops for free and play without any fees and ads based on the Netflix subscription. If you don’t find any exciting show to watch, you can always entertain yourself with the game. A viable alternative for tough times, while waiting for new titles to show up.
The Netflix product underwent a profound transformation over the years. That being said, its subscription video service is still evolving. With the latest drop in the Netflix stock price, it's interesting to observe how the company adjusts its product to sustain its position and maintain demand and growth.
Managing your product development effectively
Addressing the specific challenges related to every product life cycle phase and learning from the experiences of industry leaders are crucial for your product’s growth, but there is one more important aspect.
Constant improvement and being agile in the face of market and tech changes is key at every phase of your product. Your organization and product should align with these variables to not fall out of the market. What’s more, the Agile approach allows your teams to break down the project into phases and define high-level business goals every step of the way.
6 tips for creating successful Agile teams
Fostering product improvements
Just like you won’t find two identical solutions on the market, every product life cycle is different. There isn’t one recipe for success. It all depends on the current situation on the market, how agile your organization is and how quickly you and your teams adjust the product to emerging needs, new technologies, and trends. Without a doubt, being open to enhancements and user-centric is essential for the success of your digital product.
Keen on learning more about building great, lasting products? Dive into our product development insights!