What are LEAD USERS?

The term “lead user” is often used in connection with “customer integration”. But who are these Lead Users? And what is the lead user method? This blog post is intended to provide a brief introduction to this topic.

The concept of “Lead Users” was coined by Eric von Hippel in mid 80s. Since then many companies have profited from Lead Users particularly in the area of product development. The lead user concept helps primarily the marketing to identify key customers and develop new product concepts. It also supports the innovation management with finding the essential product characteristics and driving the product development in a targeted manner.

Lead Users are referred to as people who deal intensively with a problem in a special scope for which there is no suitable solution existing on the market. The term is used both for business and private customers. It applies to both the physical goods sector, as well as for services. Furthermore, Lead Users are characterized by the following features:

• Lead Users have self-interest in solving a problem.
• Lead Users have a good awareness of the problem which other users observe much later.
• Lead Users have special needs which the market will refer to only in the future. They have such needs much earlier than the average users.
• Lead Users benefit from early innovations that can meet these needs. Therefore, they are especially motivated to become active and to work together with the company on the development of new solutions.

These characteristics make excellent and valuable partners of Lead Users. They contribute to the identification of the future opportunities on the market and also work actively on the development of corresponding products. A Lead User is not necessarily a single person, but may also be a group of different users in the special domain. Lead Users are not to be confused with “innovative customers”, “pilot customers” or “beta users”, which use a new product for the first time (possibly before the launch) or optimize it together with the producer. Lead Users are also usually not suitable participants for a focus group discussion, for which representatives of the target market are needed. Thus, typical focus group participants are more “average” customers in a special context. Lead Users, who often do not even use the products of the company, do not represent the current market. They are users with special needs who often are not even part of the same market segment.

A further important characteristic is that Lead Users can not be repeatedly recruited for many projects. And they shouldn’t be! It is important to ensure as much diversity as possible. Lead Users play a central role and should be recruited when markets are strongly characterized by trends and trend reversals. Notable examples are the automotive industry, food or fashion industry. The methodology a company uses to systematically integrate Lead Users into the development process is unsurprisingly called the Lead User Method. Ideally, this method involves four steps:

• Identification of the most important trends of the market
• Identification of the Lead Users
• Workshop(s) with Lead Users for developing innovative concepts for the planned product
• Projection of results to the current market

Thus, the lead user method represents an especially cooperative product development process of a company with its “customers”. It should be mentioned that this method like every one provides not only opportunities but also holds risks. Especially when it comes to the development of more comprehensive and complex products this approach reaches its limits.