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Crowdsourcing Innovation: Lego Cuusoo website & Minecraft Microworld success Case Study

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Crowdsourcing Innovation: Lego Cuusoo website & Minecraft Microworld success Case Study

  1. 1. Analysis & Outlook Crowdsourcing Innovation: Lego Cuusoo website&MinecraftMicroworld success Case StudyLego is a popular line of construction toys that consists of colorful interlocking plastic bricks andaccompanied byrange of gears, minifigures and various other partsthat can be assembled andconnected in different ways, to build vehicles, buildings, and even working robots. One of thebiggest selling points of Lego Toys despite being costly is that toys stimulate the imaginationand creativity of the customers.Lego was almost bankrupt in the 2004, as children turned awayfrom the plastic bricks in favor of video games and computers and according to HarvardBusiness Review, “Central to LEGO’s turnaround is a new structure for strategicallycoordinating innovation activities, led by a cross-functional team: the Executive InnovationGovernance Group. LEGO managers take a broad view of innovation that includes not only newproducts but pricing plans, community building, business processes, and channels to market, allof which can be powerful business drivers. The company distributes responsibilities forinnovation in all areas across four groups and expects different degrees of innovativeness fromeach of them.”Innovation is at the heart of the Lego survival and further continuation of its innovation strategy,Lego launched Cuusoo website in 2008 which allows users to submit ideas for Lego products tobe turned into potential sets and users may create a page about their proposed idea for a set. Oncethe project reaches 10,000 supporters, it is then reviewed by the Cuusoo team who then decideon whether to produce it andonce decided to produce, the ideator receives a 1% royalty on thenet revenue.All the ideasrelated to alcohol, sex, drugs, religious references, post-WWII warfareor based on a first person shooter that are deemed inappropriate for younger Lego fans arerejected by the company. The term Cuusoo is Japanese and means imagination or wish. CuusooSystem, a subsidiary of the Japanese Elephant Designs, has been collaborating with LEGO forthe past ten years and the company currently manages two platforms, Cuusoo MUJI and LegoCuusoo. There are about 340,000 active users and 90 percent of Lego Cuusoo users come fromoverseas. Lego Cuusoo website also helps in strengthening the Lego player community as playerand user communities are essential for the innovation and brand building strategy of thecompany. Along with company’s internal designers, the Cuusoo community innovators willspeed up the product innovation process and bring new innovative products to the market onregular basis.Some of the ideas that already hit the shelves are Shinkai 6500, a model based on arealsubmarine, Hayabusa 369-piece, model of the Japanese spacecraft was made by DaisukeOkubo and Lego Minecraft, a set based on the video game Minecraft. Lego Minecraft MicroWorld is a Lego set based on the sandbox video game Minecraft, which revolves around thegames player character, Steve, and one of the games enemies, the Creeper. Mojang started aproject on the Lego CUUSOO program and within a matter of days; the 10,000 signatureobjective was achieved with support of Minecraft community. Sandbox is a type of video gamelevel design where a player can roam freely through a virtual world and has tools to modify theworld themselves and create how they play. According to Forbes, “Minecraft is a legitimateRajesh Prabhakar Analyst Bio @ http://socialmediacases.blogspot.com/
  2. 2. Analysis & Outlookworldwide phenomenon, a building block video game that launched in 2009 and now has over 8million paying customers and a total of 40 million users worldwide, its own conference, and alegion of YouTube stars.” Lego Minecraft Micro World was widely popular which led toshortages as both Minecraft players and other enthusiasts bought this upon its release and forcedto ship more sets during the holidays.Lego innovation platform Cuusoo is a win-win for both the Lego player community and thecompany as number of ideas generated will be more and company can rely on its playercommunity and other creative players whose ideas will be more relevant and chance of thembeing successful will be more compared to the ideas by internal designers within Lego. This isalso most cost effective, speedier and easiest way of engaging with player and creativecommunities and they are just sharing only 1% of net revenues as royalty. The voting mechanismnot only helps in selecting the best ideas but also helps in creating buzz about the product evenbefore they are manufactured and there will be a ready market available even before the productlaunch who will be interested to buy. Crowdsourcing innovation is being adopted by businessesand Lego is one company that is using this methodology extremely effectively and as discussedinnovation and creativity are essential for Lego’s long term survival. Lego is facing toughcompetition from videogames and online based games that are attracting the players more.Legohas to constantly innovate and launch new sets on regular basis to keep its consumers attracted toits product.Rajesh Prabhakar Analyst Bio @ http://socialmediacases.blogspot.com/

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