I've been listening to the audiobook of 10 Faces of Innovation by Tom Kelley of IDEO. He has a great insight into something I sorta knew, but had never thought about why it was so.
The basic idea is that showing just one prototype to a customer is bad. This tends to force them into a binary/reactive decision, one that is often determined more by their relationship to the creator of the prototype than to the item itself. Given multiple items to evaluate, the attention turns more to the items, and more feedback can be gathered, since it won't be perceived as direct criticism.
The telling analogy Kelley provides is that of a husband that is told by his wife that she has purchased a new dress. She then tries it and asks how it looks. Of course, it is difficult for the husband to say anything negative, because the question is really about how she looks wearing that dress. However, given multiple options to consider, the husband is actually more free to give honest feedback.
Now, it can be expensive to buy multiple dresses, or build multiple prototypes. The answer then is to use lo-fi prototypes: whether it be pictures in a magazine or crude drawings. Still, the more prototypes that are created, the less pressure there is to get it right the first time, which is a crushing force against innovation.
Having heard his brother speak at a conference in 2006, I love what IDEO are doing. If didn't need to make quite so much money, and had any confidence in my abilities, I would like to work there...just to live at that creative level every day would make me so happy.