Product development is what happens in real life, and design is one part of it.
Look around you. Pick something: a pipe, a furnace, a computer, a desk, a pen, a blender, a car. These are products. Somebody (probably a group of somebodies) had to develop them. The total, overarching activity that groups carry out to make products is product development.
Look at that thing you picked out. The developer had to identify a situation for which a product could be developed. Sometimes people (“clients”) bring situations to the developer; other times, the situations may be identified by the developers themselves (through market analysis or technology analysis); and sometimes the idea may just pop out of nowhere (an invention or discovery).
Given a situation that, basically, needs fixing, the developer has to figure out a product that will improve the situation without causing too much harm otherwise, and at the same time help keep the developer in business. The developer also has to figure out how to actually make (i.e. manufacture) the product. This requires guessing at the potential market for the product so that production costs won't exceed revenues from sales. The developer also has to make sure that no one has a good reason why the product cannot be sold (e.g. safety standards, government regulations, etc.).
So besides thinking up the product and fleshing it out to the point that it can actually be made, there are many other aspects to product development: marketing, business, financial, regulatory, political, cultural, ecological, etc.
Product development is, then, a joint undertaking between many different experts: engineers, designers, lawyers, politicians, marketing experts, manufacturers, etc. It is a big and messy activity that requires careful management to get the right quality and quantity of product, and still be able to make money. (After all, a company that goes bankrupt won't do anyone any good at all.)
Note, however, that the product development activity is dominated by
If these two needs cannot be met, then nothing else really matters because there won't be a product at all. These two needs are what engineering is all about.
So we then ask, what is engineering?