Synergies among Producer Firms, Lead Users, and User Communities: The Case of the LEGO Producer–User Ecosystem

Abstract

While many firms today proactively involve users in their new product development efforts using a wide variety of methods such as the lead user method, firm-hosted user communities, or mass customization toolkits, some pioneering firms are experimenting with the creation of sustainable producer-user ecosystems designed for the continuous exploration and exploitation of business opportunities. In this paper, the functioning of such ecosystems is studied with particular emphasis on the synergies they can yield. Based on an explorative and longitudinal multiple case study design, the producer-user ecosystem of the firm LEGO is analyzed, and three main actors in the ecosystem are identified: entrepreneurial lead users who aim to start their own businesses, a vibrant user community, and the LEGO company as the focal producer firm and facilitator for multiple user-to-user and user-to-producer interactions. Our study reveals three kinds of synergies: (1) reduced risk for entrepreneurial lead users and the focal producer firm, (2) the extension of the design space of the focal producer firm's products, and (3) the creation of buzz within the user community. Finally, the theoretical and managerial implications of our findings for innovation researchers and practitioners are discussed. IntroductionT here is rich empirical evidence that the locus of innovation is increasingly shifting from producer firms toward users of products and technologies, i.e., that innovation is becoming increasingly democratized (von Hippel, 2005). This shift has been accelerated by new information and communication technologies that allow users to share information and knowledge at low cost. At the same time, scholars and practitioners alike have developed a comprehensive set of methods that allow producer firms to leverage the creativity of users for their new product development efforts. Such methods include the lead user approach (Lüthje and Herstatt, 2004;von Hippel, 1986), firm-hosted user communities (Füller, Matzler, and Hoppe, 2008;Schau, Muñiz, and Arnould, 2009), and toolkits for mass customization and user design (von Hippel, 2001).While each of those methods has its specific strengths, it also has specific limitations. For example, the lead user approach bears the potential to generate breakthrough innovations (Lilien, Morrison, Searls, Sonnack, and von Hippel, 2002), yet it falls short of creating sustainable producer-user interaction. After all, the collaboration between the focal producer firm and its lead users ends with concept development at the lead user workshop. In contrast, the toolkit approach facilitated by mass customization platforms allows a more sustainable producer-user relationship, yet it is limited in its potential to create truly innovative solutions due to constrained solution spaces (Ogawa and Piller, 2006). Finally, firmhosted communities allow producer firms to leverage the knowledge diversity of a large number of users for their new product development efforts. This approach, however, is cost-intensive, and ...

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