What is Lego’s business strategy?
The Lego Group is a Danish toy-making company founded in 1932 in Billund, Denmark by Ole Kirk Christiansen on the principle that “Only the best is good enough”. The company’s flagship product is the interlocking brick pieces game which was initially produced in wood but later changed to plastic for better quality, mass production, and longer durability.
From 1963 onwards, the plastic used was changed to another synthetic fiber called acrylonitrile butadiene styrene (ABS) and continues to be in use till date. Believing that creative building games help children as they are the builders of the future, LEGO works along the shared mission of “To inspire and develop the builders of tomorrow”,
The success graph of this family-owned business has as if always seen an upward spiral facing very few setbacks and losses considering the huge popularity and size of their venture. This is thanks to their special emphasis on the quality of their products refusing to compromise with the trust of their consumers even during times of business worry. Quality assurance testers perform numerous inspections and tests on Lego elements.
Talk about Lego’s stringent safety and quality strength which is one of its biggest competitive strengths wherein a range of tests such as drop, torque, tension, compression, bite and impact are performed to ensure LEGO toys are sturdy and safe for children.
Lego-themed family amusement all over the world including cities like Billund, Gunzburg and Nagoya among others and 3 more are set to open in New York, Gangwon Province and Shanghai by 2022. However, these theme parks are not completely owned by LEGO but in collaboration with Merlin Entertainments.
LEGO also provides services in videos games, board games, educational toys and children’s clothing under the brand name of LEGO wear. LEGO Dimensions is a toys-to-life adventure video game which involves playing with physical figures and figurines featuring already popular characters such as superheroes like Batman and Robin or movie characters like those from Star Wars. Their most popular range comes from Warner Bros. movie characters. Players assemble the figurines while the instructions roll on the screen. As of September 2017, the range was parked there are also several cancelled.
2018 has been a special year for the toy-making giant who celebrated the Diamond Jubilee year of LEGO brick, Ruby Anniversary of LEGO mini-figures and the 20th year of LEGO MINDSTORMS.
Aside from these anniversaries, LEGO has continued to expand in strategic markets opening 36 new stores across 13 cities in China with two flagship stores in Shanghai and Beijing set to open by next year. During the first half of this year, the top-performing themes were LEGO Technic, LEGO NinjaGo, LEGO Creator and LEGO Classic.LEGO also plans to open a store in Dubai by the end of this year to begin work on their expansion in the Middle East.
In November 2018, LEGO launched a new range of toys titled “Forma” especially to deal with stress and anxiety among adults. Players are required to build a fish out of LEGO bricks and can be decorated in customizable skins. The idea behind the entire endeavor comes from the study that combining organic forms and mechanical work can engage the mind very deeply and help reduce the strain.
There is immense scope in businesses in the times we live in and LEGO is striving for the best as it faces competitions from other toy-making companies that have begun to shake their stronghold in the markets. The detailed LEGO business strategy is very insightfully covered under the LEGO SWOT and PESTLE Analysis which gives a 360-degree view on the internal and external factors impacting this miniature toy giant’s business case.