Consider the construction of a building. What is the first thing that is finished? The foundation laying out a plan upon which the building is constructed. With a glimpse, pillars and walls can be identified and as the construction proceeds, the finer details can be carved out. The same principle can be used for creating products.
Prototype, if well-thought-out, can be the foundation of a great product. Prototyping builds on the ideas of Agile Development where incremental changes are made to shape the final product. In a similar fashion, first, a basic prototype is created which should be able to convey the core product idea to the users while stimulating more ideas to supplement the product. Iteratively, those ideas are incorporated or discarded in a systematic manner to create newer versions of the prototype until there is enough confidence that the vision of the product and the latest version of the prototype are similar.
Prototyping allows different perspectives to bring in changes in the vision of the product as well and hence, the plant can be a lot different from the seed. This approach might sound counterproductive, is more business minded. Every stable prototype is usually tested by a focus group which is not much different from the consumers. The early adopters can help developers understand the features from a user perspective and eliminate the biases that affect development teams. Multiple iterations allow incorporation of more knowledge and ensuring that outliers are not affecting the development.
Product development is as much about technology as it is about understanding users. User interaction from an early stage increases the utility of the product. It might trade sales for innovation, it ensures that the probability of success is higher which ultimately increases the scope of innovation. One can only enhance a product that sells.