Lego Story: What the Company Learned From Its Mistakes

Summary

In this interview, the LEGO Group CEO reflects on the company's recovery from near bankruptcy, emphasizing the importance of listening to customers, especially children. He discusses LEGO's success in adapting to evolving market demands, such as creating the LEGO Friends line for girls and integrating digital play. The company learned valuable lessons from past failures, improving both product development and marketing strategies. LEGO's commitment to creativity and hands-on play remains at its core, with the company aiming to inspire future innovators. The CEO also touches on the LEGO Movie's impact and a planned sequel.

Takeaways

• 😀 Lego's past failure stemmed from not listening to customers, leading to a near bankruptcy.
• 😀 After recognizing their mistakes, Lego focused on listening to children’s needs and interests, leading to sustained growth over the past decade.
• 😀 Lego spends significantly on product development and retail partnerships to improve in-store and online brand execution.
• 😀 Lego's success in recent years is attributed to its constant adaptation to digital trends and kids' evolving interests.
• 😀 The Lego Friends line, introduced in 2012, was a response to the needs of girls and has been growing by 20% annually.
• 😀 Lego's approach to targeting girls involved understanding their play habits, which are more focused on smaller, step-by-step processes and role-playing.
• 😀 The company learned from previous failures in the girls' market and refined their approach based on customer feedback.
• 😀 Lego embraces the digital space by allowing children to transition seamlessly between physical and digital play experiences, enhancing the Lego brand's appeal.
• 😀 Lego's philosophy focuses on inspiring creativity, with a goal to nurture the engineers and architects of tomorrow.
• 😀 Despite the success of The Lego Movie, it was notably omitted from the Oscar nominations for Best Animated Feature, but Lego created its own 'Lego Oscar' as a fun response.
• 😀 Lego's commitment to the development of children's creativity is central to the company's mission, as seen in their pride in watching children engage with their products.

Q & A

What led to Lego's near bankruptcy, and how did the company respond?

Lego's near bankruptcy was partly due to the company becoming too insular and failing to listen to its customers. After a period of consecutive success, Lego became more introverted and ignored the evolving needs of its consumers. The company learned to truly listen to customers, which has since contributed to its ongoing success.

What has been the key to Lego's success in the last decade?

The key to Lego's success over the last decade has been a focus on understanding the needs of children at every age and stage. This involved continuous product development and ensuring the brand remains relevant to both kids and retail partners, especially through digital integration.

How did Lego change its approach to product development and marketing?

Lego shifted its focus to product development by spending more on designing products and working closely with retail partners to improve the in-store and online execution of the Lego brand. This shift also included embracing the digital space to engage with children in new ways.

What challenges is Lego currently facing in the market?

Lego is currently not facing major challenges and is enjoying a period of success. The company credits this success to their constant ability to listen to the needs of children and adapt to the digital space, including leveraging storytelling and interactive play experiences.

What inspired the creation of Lego Friends, and why was it successful?

Lego Friends was created to appeal to girls and break away from traditional gender stereotypes in toys. The success stemmed from understanding how girls play differently, preferring smaller building steps and role-playing elements. This approach led to a consistent 20% annual growth for the product line.

Why did it take so long for Lego to develop a product line aimed at girls?

Lego's development of products aimed at girls took longer because the company initially struggled to understand what girls wanted in a building toy. It took multiple failures before Lego realized that girls preferred shorter building processes combined with role play and figurines that were more relatable.

How has the digital age affected Lego's approach to toys and marketing?

The digital age has significantly impacted how Lego markets and designs its products. The company integrates digital experiences, such as video games and online platforms, with traditional physical play. Lego believes in the importance of bridging these two worlds to maintain engagement with children.

What is Lego's perspective on its role in fostering creativity in children?

Lego views its role as one of inspiring and nurturing the builders of tomorrow. The company is deeply committed to encouraging creativity and imagination in children, helping them develop important skills through hands-on play and problem-solving.

What was Lego's reaction to not receiving an Oscar nomination for 'The Lego Movie'?

While Lego did not receive an Oscar nomination for 'The Lego Movie,' the company was proud of the film's success. One of the directors humorously created a 'Lego Oscar' as a response. The company views the success of the movie as more important than any formal recognition.

Will there be a sequel to 'The Lego Movie'?

Yes, a sequel to 'The Lego Movie' is scheduled for release in 2018.