R&D, otherwise known as research and development, is typically the conception and implementation of new product ideas. The research portion of R&D refers to the investigation and experimentation stage of creating a new product or improving an existing product. The development portion is the process of designing and testing the effectiveness of the new product or product improvement.
Research is typically an investigation of current knowledge about existing products in order to find a fresh idea for a new product. The theory behind this part of R&D is that without the discovery of innovative ideas, there may be no creation of new products. Basic research seeks to increase knowledge about a subject, while applied research often looks for creative ideas to design new products or ways to improve existing ones.