Developing innovation depends on and is vital for the survival of firms. However, a huge mass of innovations do not succeed in the market. There are many studies that researched the critical factors affecting the success or failure of innovations. A large part of the literature on this topic depends on the two main theories; product life cycle and Rogers's adopter categorization. These two models consider consumers being passive. In fact, active participation of consumers in innovation development process could enhance the success of innovations. In this theoretical study, a critical literature review has been accomplished in order to understand the role of consumers in innovation development process and its effects on the success of innovations. Categorization of current literature in a prosumer based view reflects that all the related theories on innovation development take into account buyer characteristics and behaviour. However, they are not concerned about suppliers' new product development and marketing activities as proactive variables. Moreover, not only introduction and diffusion but also adoption and consumption stages of innovations are also the main factors affecting the success of innovations in the market. Only demand or supply side factors might only partly succeed. The new innovation development perspective, which is proposed in this study, encompasses all the related variables under varying factors where many of them are context dependent. Thus, this view strengthens the studies and application in innovation development with consumer's integration. This perspective could be worked in a balancing and iterative way. After all, new products that perfectly meet consumers' needs and wants can be developed, which then succeed in the market.