LEGO System A/S
It’s refreshing to see large companies taking risks in closed markets, and we’re glad to see Lego embracing open innovation and integrating its users in its product development process. As Lego Cuusoo is built off an existing open innovation platform, the jury would have liked to better understand how this off-the-shelf platform has been customized for Lego users, as well as how Lego might build complementary services to further engage users. Although the project is in the early stages, it shows promise and we’re keen to see Lego expand this offering.
1. The Nutshell: In plain language, tell us what your project is, what it does, and what it’s comprised of.
LEGO CUUSOO is a website where LEGO fans can submit their ideas for new LEGO products and collect votes to make their ideas become a reality. They can also vote for other users’ ideas. It can be found at http://lego.cuusoo.com. Ideas that are supported by 10,000 votes have a chance of being selected to become part of the LEGO Group’s product portfolio. Consumers who have their ideas chosen will earn 1% of the total net sales of the product.
2. The Brief: Summarize the problem you set out to solve. What was the context for the project, and what was the challenge posed to you?
LEGO CUUSOO did not so much as set off to solve a problem as it did to exploit an opportunity. LEGO CUUSOO is used to identify new consumer market segments by crowd-sourcing the collection of ideas from thousands of enthusiastic LEGO fans and quantifying their potential through a popular vote. In essence, LEGO CUUSOO allows the general public to tell us what they would buy, and the system enables the serendipity of consumer demand to surprise us, identifying market opportunities that we previously could not conceive or quantify. This also intentionally allows for product ideas that might otherwise be filtered out in the product development process--the outliers and oddballs--to emerge to the surface if there is popular support.
The challenge was then to build a system that enabled as many as possible to propose a product idea, and to solicit the votes of the general public. We set out to produce as open and fair of a system as possible to allow for the serendipity. In order for this crowd-sourcing system to succeed, we needed to collect market research data, demographics, and analytics to quantify audiences and where they can be reached. We use the data to analyze a potential new product that passes our support threshold, and in turn to market the product back to the audience that requested it.
3. The Intent: What point of view did you bring to the project, and were there additional criteria that you added to the brief?
The intent was to provide as open of an opportunity as possible to the consumer while being able to successfully operationalize the process of user generated ideas achieving a critical mass of supporters organically.
We believe in the creative energy of our fans, and we believe that some of our best ideas have the potential to come from outside the walls of the company. While we do not see crowd-sourcing as something that will replace traditional product design, this has strong potential to augment our product offering and engage fans by producing what they tell us they want to purchase.
LEGO CUUSOO strives to be a fair system where any user-generated project that fits the LEGO brand values qualifies for the opportunity to have others support their project, making it eligible for the review.
Projects that achieve over 10,000 supporters are reviewed by the LEGO Company for consideration as a potential product. A project can cross the threshold of 10,000 supporters at any time, sometimes quickly without warning. At any time, the company could have an enthusiastic fan base knocking on our doors to review, accept, and produce the next emergent idea.
4. The Process: Describe the rigor that informed your project. (Research, ethnography, subject matter experts, materials exploration, technology, iteration, testing, etc., as applicable.) What stakeholder interests did you consider? (Audience, business, organization, labor, manufacturing, distribution, etc., as applicable)
The LEGO Company employed the expertise of CUUSOO System a product design and crowd-sourcing company based in Tokyo. With the assistance of CUUSOO founder Kohei Nishiyama and the CUUSOO System team, LEGO CUUSOO was first developed as a test for the Japanese market. The company set out to test the novel concept in a limited market, contained from the global markets due to the language barrier.
The Japanese alpha of LEGO CUUSOO yielded two fan-created project ideas produced as LEGO products for the Japanese market in 2010 and 2011. After successfully testing the concept, in 2011 the company released an “open beta” for a worldwide audience in October 2011.
The LEGO CUUSOO development cycle is in some regards opposite the traditional LEGO product cycle. Fans submit ideas in a public environment, consumers vote, and an announcement is made that we have decided to produce a product before it is designed or produced in the factory. This creates communication challenges with internal marketing teams and external retailers who are confronted with consumer demand for something unexpected and not planned for. We have considered these stakeholders’ communication needs as we are adapting to the pre-scheduled production slots.Internal stakeholders (product development teams consisting of project managers, production planners, model designers, graphic designers, marketing teams, etc.) have been asked, and have risen to the challenge of, shortening a typical 12-18 month product development cycle down to only 6 months between project approval to shipping finished boxes to consumers. This is unprecedented in the LEGO Company, however product team members have enthusiastically risen to the challenge and delivered on schedule and budget.
LEGO CUUSOO has caught the attention of the company’s large retail partners, who are accustomed to reviewing the entire LEGO product range on an annual basis. The first emergent worldwide project, LEGO® Minecraft™ Micro World, took major retailers by surprise. They have asked the company for the ability to stock it on their store shelves for the 2012 holiday season; this is the first time to our knowledge that a new LEGO product has generated unsolicited demand from our retail partners.
The LEGO fans that use LEGO CUUSOO are very enthusiastic and feel a close affinity to the brand, which means that many feel the LEGO Company is responsible to them to deliver to their expectations. This is a double-edged sword; the company benefits from its reputation as the highest quality construction toy in the world, and our most loyal consumers constantly demand we live up to the expectations we set.
Fans expect transparency in the process, fairness when projects are reviewed, and insist that LEGO CUUSOO does not enable anyone to claim the creative work of another as their own. We must also align fan wishes with the LEGO Company brand standards and values. It is the challenge and the opportunity of the LEGO CUUSOO team to set the right expectations up front and provide a transparent framework that works for fans within the framework of the LEGO brand.
5. The Value: How does your project earn its keep in the world? What is its value? What is its impact? (Social, educational, economic, paradigm-shifting, sustainable, environmental, cultural, gladdening, etc.)
LEGO CUUSOO brings a new dimension to fan interaction with the LEGO brand while shifting how product ideas are sourced and validated. The value of LEGO CUUSOO has proven itself with high pre-order numbers for the first global release, LEGO® Minecraft™ Micro World.
LEGO CUUSOO identifies and quantifies audiences and markets that have previously not been defined. The value of this goes beyond the individual product; the LEGO Company is able to use the insights it gathers in additional products to reach the same target audience. Therefore, its value has only begun to be quantified.
The existence of the LEGO CUUSOO opportunity brings a new level of engagement to the fan communities, who now have a mechanism to directly affect what the LEGO company produces, and to even potentially have their work incorporated into an official product. It has resonated well among the core LEGO fan groups as well as males 18-34 who are interested in computers, gaming, movies, and Internet culture. Content from LEGO CUUSOO, especially LEGO product proposals after popular movies and games, is shared far and wide across the web without any marketing.
6. Outline the steps of the service; what are the intended behavioral patterns or “scripts” for the actors interacting with the service?
LEGO CUUSOO lets LEGO fans propose a new LEGO product idea, and gives them the tools to build an audience who is interested in buying their product if it is produced.
The site invites people to come and create a “project,” containing their LEGO idea or product concept, and post it to the site. They can then share their project and solicit voters (or “supporters”) from around the web. If their project reaches 10,000 supporters, the LEGO Group promises to review their submission and consider it for production. If we decide to produce it, we give the person who submitted it credit and 1% of net product sales.
People online see a LEGO CUUSOO project that is shared, and if they like the idea they can come and support it. When people support a project, they tell us what they would pay and how many they would buy, and give some biographical information about themselves. This way we not only observe demand, we also collect data that helps us identify the market for the idea. Supporting a project allows people to opt-in to receive the opportunity to buy the product if it is released.
7. How did you identify the possible leverage points in the service system? How did you evaluate the importance of each, and determine the mix of interventions that would have the greatest impact?
To succeed, LEGO CUUSOO must yield a consistent pipeline of user-generated product ideas that have potential of being produced. From there, the LEGO Group creates a series of profitable products from the insights we gain from our users. Our team takes the concepts submitted and produces desirable products and at an appropriate price point and sells the product back to the market we have identified and beyond. Allowing consumers to vote for a new product identifies a concrete audience (the actual supporters) and a broader audience (the general demographic characteristics of the supporters).
The pipeline of qualified product ideas is the most important driver for our success. The Project page is our most popular landing page: most people visit for the first time via a link to a project they like. We continually refine the Project page so it promotes our most desired action: encouraging users to register their support of a product idea. There is a balance between making the desired action clear, and introducing just enough friction so that the user only clicks the button if we believe they actually would want to buy the idea as a product. This way, the data we collect is meaningful.
In addition to encouraging people who land on a project page to support, we work to cultivate an even larger pipeline of new project submissions. Since we want these projects to succeed, we present the user with a series of guidelines up front that tell them how the site works and what types of projects are acceptable. This sets them up for success in the event their project receives the requisite 10,000 supporters and we review it to become a potential product.
Over time we have learned how to frame our project guidelines by observing the range of user-generated submissions. LEGO fans are very creative, and sometimes they create things that we either can’t make or that go against our brand standards. This has given us the opportunity to think hard about what we do and do not want from a user submission, and to refine the way we communicate this framework externally, so that we set the right expectations with our fans.
By providing this open innovation platform, we are encouraging people to submit different, offbeat, and even challenging ideas. It is a given for the LEGO Group to produce a new fire truck for our City line; we do that each year. Where LEGO CUUSOO shines is in identifying novel products or new IPs like the LEGO Minecraft Micro World. This is just one example of a product that has already proven a great success by buzz and pre-order sales, however without a platform like this and the ability to identify the people who want it, it would never have come to fruition. By accepting the challenge of user submissions, we end up with gems like this. Our team is looking forward to many more unlikely surprises to become beloved LEGO products.