Why is Prototyping Important in Business?

Person working on UX UI design for prototype

As an entrepreneur, it's likely that, depending on your niche, you are going to be introducing new ideas into the marketplace to gain a competitive advantage. However, by their definition, new ideas can be risky and as hard to sell to your team as they are to investors and consumers. A new product or service can prove an expensive proposition, and jumping into the deep end without the necessary prior preparation can be just as costly as doing nothing at all.

So, how do you get everyone on board and test the viability of your grand new product without risking it all? Developing a prototype is an excellent way to gauge whether an idea is going to work before putting the full strength of your company behind it. To illustrate how, we've compiled a breakdown of the importance of prototypes in business, and why developing one should be the first task in any new venture. 

What Is a Prototype?

When we think of what a prototype is, we often picture something flashy or abstract, like a high-concept test car or fighter jet. However, in reality, a prototype does not need to anywhere near as extreme to accomplish its goal. 

In simple terms, a prototype is a test version of a product that a team puts together to examine the viability of a new idea. It should be functional enough that it can convey its purpose to team members, potential customers, and outside investors, as well as demonstrate how the product will interact with the real world and how it will appeal to an audience.

The Importance of Prototypes

Ultimately, a prototype can be considered successful if it:

  • Aids in the evaluation of the final design
  • Determines potential interest in a new product line
  • Informs the manufacturing process for a new product
  • Builds the marketing language for a new launch
  • Creates support for investment

To understand these objectives – and a prototype's role in achieving them – let's look at each of them more closely, and ascertain what they mean for your product development cycle.

Prototyping for Design

One of the traditional objectives for a prototype is to get a sense of how practical the overall design is in a product development cycle. After all, a new idea may sound great on paper, but it is another thing to see a rough approximation of what the product will look like when it is launched.

Whether you have the resources to build a fully functioning version of your new product, or you are just seeking to create a mock-up, there is a lot of potential value in building a prototype to test design. 

If you run a company that designs and builds new tech gadgets, for example, a prototype is essential for determining whether the concept you envisioned can hold the hardware it needs to. It also helps determine if the form factor that will help it sell is achievable.

Another important part of prototyping for design is to be aware that what you had in mind is not always achievable. Perhaps the sleek new consumer product you envisioned ends up looking clunky and unattractive in its test format. This may sound like a setback, but it enables you to try different designs or focus your attention elsewhere. Prototyping is an iterative process that you and your company can learn from in search of the perfect creation to bring to market.

Prototyping to Gauge Interest

You do not have to reinvent the wheel to get value out of a prototype. There is a lot to be gained by creating a simple design for a new approach and presenting it to your current customers, or a new market that you hope to access.

Even a business with products that can be considered a safe bet, such as a bakery, can find value in creating a prototype unit and presenting it to their customers. Experimenting with a new menu item and offering it to your customers will let you know if it is worth diverting further resources, and adding it as a permanent fixture in your store.

This is another great opportunity for the type of constructive prototyping discussed above. Bring your test item to your customers or a focus group and get their reactions; they may have valuable insight into what could improve it or make it attractive to a wider audience. Creating a prototype and distributing it gives you an opportunity to explore options that you and your team may not have previously considered.

Prototyping to Test Production

Another useful function of prototyping is to measure whether your current production processes can handle the new item. This can apply to either a physical manufacturing setup, or simply the organisational structure of how your team meets client expectations.

If you run a company that manufactures products and you want to introduce a new line, you need to know that your current configuration will be able to handle these new challenges. Creating a prototype will help determine whether your current technology and inventory will be able to build what you need and maintain such output after a full launch has disrupted your existing processes.

Prototyping is also an excellent opportunity to find out if any of your current manufacturing techniques can be improved upon. Creating a test run will allow your engineers to incorporate new ideas and experiment with them in a controlled setting in ways that can deliver value to your existing set up.

Prototyping for Marketing

Sometimes, a physical representation of an abstract concept can be what is required to successfully pitch the idea within your own company. A prototype will help everyone around you see the value of your idea and help your marketing team figure out how they will sell it to your customers.

Once your team is behind the idea, having a prototype of what they will pitch to clients will help them develop campaigns and lay the groundwork to make the product launch successful. As humans, we react far more positively to things that we can see or touch, and this makes it easier to present and persuade.

It also provides a more accurate idea of the dimensions and functionality of the product, allowing you to convey the value of your innovation to your target market.

Prototyping for Investors

Of course, it's not just your internal team and your customer base that you will need to convince; introducing a new idea to an established market is expensive. Therefore, you will require capital, and a committed investor can help defray the cost of launching that product. A prototype is absolutely vital – and, in the case of some investors, mandatory – for securing backing.

Unlike with your marketing team, however, the value here is not just in showing off what your product will do or what it will look like. It also demonstrates that your team has the dedication and the know-how to build and market a viable new product. Potential lenders will gain confidence that the design has been reviewed, analysed and tested, and that given the appropriate financial backing, the product can hit the market running and provide those all-important returns.


If you want to set your company apart from your competitors and introduce disruptive new ideas into your industry, then building a prototype is a great place to start. It allows you to build confidence among your team, generate a tangible buzz among consumers, and illustrate to investors that you are worthy of their capital.

What do you think? Should you spend time developing and reviewing a prototype, or look to get your product to market as quickly as possible? With the rise in popularity of lean startup principles, are prototypes going to become redundant? Join the argument and let us know your views in the comment section below!