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How Lego Clicked: The Super Brand That Reinvented Itself (theguardian.com) 191

managerialslime shared an article about how Lego executed "the greatest turnaround in corporate history." The Guardian reports: By 2003 Lego was in big trouble. Sales were down 30% year-on-year and it was $800m in debt. An internal report revealed it hadn't added anything of value to its portfolio for a decade... In 2015, the still privately owned, family controlled Lego Group overtook Ferrari to become the world's most powerful brand. It announced profits of £660m, making it the number one toy company in Europe and Asia, and number three in North America, where sales topped $1bn for the first time. From 2008 to 2010 its profits quadrupled, outstripping Apple's. Indeed, it has been called the Apple of toys: a profit-generating, design-driven miracle built around premium, intuitive, covetable hardware that fans can't get enough of. Last year Lego sold 75bn bricks. Lego people -- "Minifigures" -- the 4cm-tall yellow characters with dotty eyes, permanent grins, hooks for hands and pegs for legs -- outnumber humans. The British Toy Retailers Association voted Lego the toy of the century.
It's a good read. The article describes how CEO Vig Knudstorp curtailed the company's over-expansion -- at one point, Lego had "built its own video games company from scratch, the largest installation of Silicon Graphics supercomputers in northern Europe, despite having no experience in the field." And he also encouraged the company to interact with its fans on the internet -- for example, the crowdsourcing of Ninjago content -- while the company enjoyed new popularity with Mindstorms kits for building programmable Lego robots.
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How Lego Clicked: The Super Brand That Reinvented Itself

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  • by Anonymous Coward on Sunday June 11, 2017 @11:44PM (#54599547)

    Not really, I miss the old Lego, before they tried to make nothing but branded and licensed parts that sell well because of their associated content.

    • by jonwil ( 467024 ) on Monday June 12, 2017 @03:14AM (#54600101)

      As someone who has many thousands of LEGO pieces (old and new) and just spent all weekend at a big LEGO exhibition as an exhibitor, I can tell you that you clearly dont know anything about LEGO if you think that all they make is overpriced licensed crap.

      You need to check out sets like the 10255 Assembly Square, 42055 Bucket Wheel Excavator, 10194 Emerald Night, 10210 Imperial Flagship and 70751 Temple of Airjitzu. None of these sets are licensed and all of them are full of useful parts (including basic bricks and things).

      If all you want is basic simple generic parts then the Classic line has boxes full of bricks, wheels, windows, doors, roof pieces and other "simple" parts.

      Oh and if you think that all the licensed sets are crap, you clearly haven't seen sets like the 42056 Porsche 911 GT3 RS, 75827 Ghostbusters Firehouse Headquarters or 10179 Ultimate Collectors Series Millennium Falcon.

      • by Opportunist ( 166417 ) on Monday June 12, 2017 @07:09AM (#54600881)

        I envy you for your spare time.

        But even more that your parents didn't get a hold of your Lego and gave it away. *sniff*

        • by jonwil ( 467024 )

          That did happen, it got given away to someone who ended up using it more than me (I was there and I was happy to give it away).

          All the stuff I have now is new stuff I bought as an adult.

      • by AmiMoJo ( 196126 )

        You need to check out sets like the 10255 Assembly Square, 42055 Bucket Wheel Excavator, 10194 Emerald Night, 10210 Imperial Flagship and 70751 Temple of Airjitzu.

        Those do look amazing, but I think the GP's point about being overpriced might be true. The Bucket Wheel Excavator is £125 on Amazon, and I saw a nice Porsche that was £175 (RRP is £270).

        For kids that's an awful lot of money. To be honest I'd quite like to build those two myself, but only if they come on sale. And while they are well made and durable, it does seem a lot for a kit of plastic parts that aren't even unique moulds.

        I haven't tried any of the knock-offs, and ma

        • by ranton ( 36917 )

          Those do look amazing, but I think the GP's point about being overpriced might be true. The Bucket Wheel Excavator is £125 on Amazon, and I saw a nice Porsche that was £175 (RRP is £270).

          The Bucket Wheel Excavator has nearly 4000 pieces. Even the Lego Creative Large Box ($85) only has 1500, and their large creative box is a big set of blocks. But yes some of sets like the Porsche are very expensive but they seem to be targeting adult collectors not kids.

          For kids that's an awful lot of money. To be honest I'd quite like to build those two myself, but only if they come on sale. And while they are well made and durable, it does seem a lot for a kit of plastic parts that aren't even unique moulds.

          Lego is a high end brand and not the type of toy kids are going to buy much of with their allowance. It is more like an XBox which is more likely coming from the parents or Santa than from the kids' piggy banks. For the same price as an Xbox

          • I disagree. While yes Lego does have large, expensive sets, the majority of their sets are small and affordable. My kids love Their LEGOs and I have to double check when shopping for presents because half the set's I'm looking at they already bought (with their allowance). And compared to the other major toy-lines they are very competitively priced.

            LEGO sets can cost an arm and a leg, but they also market many at much lower prices. With a large variety between $15 and $40. (I'm not rich, I try to shoot
            • by ranton ( 36917 )

              Touche, I have to admit that my children haven't gotten to an allowance age and I never had one as a kid so my viewpoint here could be quite off. I know that even at the age of 12 I had a hard time even saving up $10 (around $20 in 2017 dollars) but I grew up in a working class family. I concede my children will probably not have that problem living in an upper middle class suburb and if they so choose could likely buy their own legos. Probably not the $100+ sets, but there are plenty of $10-$25 sets as wel

            • by jonwil ( 467024 )

              Yeah LEGO has awesome non-licensed sets starting as low as $5 (US RRP) and a huge range below $50 (US RRP)

        • by trabby ( 4123953 )

          Nevermind that the Millenium Falcon set fetches over $3k... used

        • I haven't tried any of the knock-offs, and maybe I'm missing something, but they do seem rather expensive to me.

          Maybe someone else will reply and show that this is BS, but SUPPOSEDLY (yes, I admit I am passing on something I heard with no proof) actual Lego interlock better and for a much longer time (i.e. don't wear out due to connecting/disconnecting).

          Supposedly "more accurate molding process" or something like that.

        • Kreo aren't bad. My kids have a few sets I got as an experiment - there was some theme that wasn't available in Lego. Transformers, maybe.

      • Oh and if you think that all the licensed sets are crap, you clearly haven't seen sets like the 42056 Porsche 911 GT3 RS, 75827 Ghostbusters Firehouse Headquarters or 10179 Ultimate Collectors Series Millennium Falcon.

        I've seen the Star Destroyer [amzn.to] (the three-feet version) in more than a few Fortune 500 companies, usually hanging from the ceiling in the marketing department.

      • The main problem with the Classic products is finding them. They've been crowded off the shelves by the huge numbers of other Lego products. For example, a Target store I was in recently had one and a half aisles of Lego products, but Target only sells 13 Classic Lego kits and that store didn't have all of them. All in all the Classic line represented less than 5% of their total Lego shelf space. Their larger stores do carry most of the 13 products (a couple of things like the 48x48 base plate appear to be
    • by Carewolf ( 581105 ) on Monday June 12, 2017 @04:34AM (#54600389) Homepage

      Not really, I miss the old Lego, before they tried to make nothing but branded and licensed parts that sell well because of their associated content.

      Actually they have less special parts now. It was one of the things they fixed during the turn-around. They have licensed models, but fewer special parts.

      • Not really, I miss the old Lego, before they tried to make nothing but branded and licensed parts that sell well because of their associated content.

        Actually they have less special parts now. It was one of the things they fixed during the turn-around. They have licensed models, but fewer special parts.

        You can still find generic kits: they're cheap too [lego.com]. There are also over-priced versions aimed squarely at adults [lego.com].

      • by mspohr ( 589790 )

        Check out this kit:
        https://www.amazon.com/LEGO-Di... [amazon.com]
        I doubt that there is a single "generic" brick in this kit. It's all special parts.

        • Actually, except for the little snowmen, I've seen every one of those parts in other sets. They were different colors & didn't have printing on them(or is that stickers?), but the mold was the same.
          • I haven't seen the slide or the spiral staircase though I can see use cases for both. The only ones I'd say are special are the large windows & the snowflake on top but you're a darn sight closer to right than he is.

    • by Salgak1 ( 20136 )

      Pepperidge Farms Remembers! (grin)

    • Re: (Score:2, Interesting)

      by mspohr ( 589790 )

      I agree. I miss the old simple Lego.
      The new kits don't leave any room for creativity. Just put the parts together (only one way to do that) and look at it.
      They have all of these unique parts that can't be used to build anything else.
      My granddaughter got a "Frozen" Lego kit for Christmas. It came with a 50 page instruction book and lots of little parts. I tried to put it together but gave up. I felt like a slave in a sweat shop.

    • They still make the big boxes of generic pieces. Might be hard to find them among the aisles and aisles of other Lego sfuff.
  • by dwywit ( 1109409 ) on Monday June 12, 2017 @12:36AM (#54599733)

    Lego still allows the user to exercise their own creativity. You might buy a Star Destroyer kit, but you can build other things with it.

    • Re: (Score:1, Troll)

      by fermion ( 181285 )
      I got an apple because it let me create right out of the box. Shape tables are awesome. Plug in a board and I was burning EPROMs. VisiCalc and excel were first in apple.

      People but h today but nobody solders thier hacks like I did on my apple. People plug in cable or plugin a chip and they think they have built a computer. Give me a break.

      I have python running on my mac, I have gcc. I have LaTex and I don't think nothing beats Texshop.

      The problem with legos now is you don't start with a blank sheet

      • by AmiMoJo ( 196126 )

        Lego Technic is the best for creativity. While they do give you instructions for a couple of models, the skills you learn when you build them are the tools you need to turn your imaginary machines into reality.

        Lego kits don't take away creativity, they teach kids mechanical engineering without them realizing they are being taught anything.

        • Indeed. And Lego kits, with the exception of the tub-o'-bricks, have always been like that: you got a box with pieces and instructions for building one or two models with it. After that, you're on your own.

          What is a bit different nowadays is how kids play with it. When we got a new Lego box, we'd build the model from plans once, then the bricks would disappear into a huge drawer with the rest of the Lego, to be used for building whatever took our fancy. And we learned to build a lot just by trying: s
          • However kids today treat Lego more like Revell kits: you build it once, then display it.

            Hence the recent feature-length public service announcement not to build something according to Instructions only to freeze it in place with KRAzyGLuE.

          • by fermion ( 181285 )
            I grew up with only a tub of bricks. Me and my friends never had trouble building anything we wanted. Same for the erector set.

            The problem with this from Lego point of view is they only sold one tub per family. Now they sell many sets per family

            I know people have trouble with a blank canvass that us because they did not do enough free play, which Legos can be a part.

      • by tlhIngan ( 30335 )

        The problem with legos now is you don't start with a blank sheet of paper. In terms of teaching creativity, getting people to not be afraid of the blank canvass is a critical step.

        True, but a lot of times, people stop at the blank canvas. Opening a word processor and staring at the cursor on the sea of white and trying to type something creative is almost impossible (it's referred to as writer's block).

        The real problem is creativity strikes randomly. The author who might be stalled at the blank screen on t

      • The problem with legos now is you don't start with a blank sheet of paper.

        The problem with computers now is you don't start with a blank sheet of paper. Pesky OS! I just expect to be dumped into BASIC!

        what the company has done is give up on its core mission for profit. Which is fine. The good parents can still buy real lego sets.

        It doesn't sound like they've given up on anything at all.

      • That's silly . It was always the same path: Get a set, build the set as instructed. Almost immediately start modifying it more and more. Then "crash" it, and try to rebuild without the instructions. Then crash again and build variants.
        Eventually it's pieces worked their way into a group of pieces.

    • Lego still allows the user to exercise their own creativity. You might buy a Star Destroyer kit, but you can build other things with it.

      Ain't that the truth. I rather liked this idea: http://www.thebricktestament.c... [thebricktestament.com]

      The part about camp deification was amusing: http://www.thebricktestament.c... [thebricktestament.com]

    • The part of the Apple comparison I was most interested in was the claim about profits. They're trying to tell us that topping $1 billion in sales (i.e. revenue) for the first time was sufficient to top Apple's profits in 2008-2010, right as the iPhone was gaining traction? I'm not buying it.

      In the fourth quarter of 2009 alone, Apple posted profits of $1.67 billion on $9.87 billion in revenue, which would already be enough to top LEGO's sales numbers for the entire year. I don't see how one billion in annual

  • by Eloking ( 877834 ) on Monday June 12, 2017 @12:53AM (#54599769)

    There, let me save you the trouble of reading a boring article by sharing this cool video instead, The Lego's Story : https://youtu.be/NdDU_BBJW9Y [youtu.be]

    • by Anonymous Coward

      >instead of reading this short(ish) text article, why not consume the same information in a format which will require a ten times larger time investment and annoy everyone around you?

      Screw you and everyone who thinks like you.

    • by ratbag ( 65209 )

      A new way to add an erroneous S to LEGO. Well played.

      That video is called "The LEGO Story". No apostrophe, no S (there never is with Lego or LEGO. Never).

      Yes, this irks me. No, I've no idea why (and I'm not looking for suggestions, thanks)

      • by Eloking ( 877834 )

        A new way to add an erroneous S to LEGO. Well played.

        That video is called "The LEGO Story". No apostrophe, no S (there never is with Lego or LEGO. Never).

        Yes, this irks me. No, I've no idea why (and I'm not looking for suggestions, thanks)

        Sorry about that, I'm french but I'm learning.

        • The folks who feel militant about an errant "S" at the end of Lego may be technically correct but they're certainly not worth apologizing to for their pedantry. You should have tried to convince him it was correct in French instead just to mess with him.
          • by Eloking ( 877834 )

            The folks who feel militant about an errant "S" at the end of Lego may be technically correct but they're certainly not worth apologizing to for their pedantry. You should have tried to convince him it was correct in French instead just to mess with him.

            True but I'm Canadian so we kinda apologize for everything, sorry!

  • In the late 80's I posted a warning to Alt.Home.Repair about a Sears garbage disposal that's inner coating grew and would block it from running (short version)

    Two months later Sears called (phone) to set things straight.

    Note: In those days we could create a finger file (which I put my phone number in). If someone fingered me, they would get that finger file. E-mail addresses at the bottom of ones post custom. A different Internet.

  • by nospam007 ( 722110 ) * on Monday June 12, 2017 @02:45AM (#54600045)

    My doctor always asks me:

    'On a scale of 1 to stepping on a Lego barefooted, in how much pain are you'?

  • by Ihlosi ( 895663 ) on Monday June 12, 2017 @03:34AM (#54600151)
    Fischertechnik is for geeks in training.

    Too bad it's been dumbed down compared to 30 years ago. No more circuit or pneumatic diagrams, no more logic gates.

    • Too bad it's been dumbed down compared to 30 years ago. No more circuit or pneumatic diagrams, no more logic gates.

      They have programming now. Get real.

  • The turnaround story has changed a lot over the years. They no longer talk about their failed outsourcing strategy or about how their push for extreme automation made their production lines so inflexible that they were constantly producing the wrong products.

    • The turnaround story has changed a lot over the years. They no longer talk about their failed outsourcing strategy or about how their push for extreme automation made their production lines so inflexible that they were constantly producing the wrong products.

      This version did mention it indirectly by saying they now prefer to produce locally so they can always have the right products on the shelves at the right time.

      • by amorsen ( 7485 )

        That is not how it happened, though. They outsourced and discovered that their bricks no longer stuck together properly.

        As for the thing about producing locally, Technic at least tends to come from all over the place, if you buy it in Denmark or England.

        The Lego reinvention story is primarily a marketing device.

        By the way, I completely support Lego, I think the vast majority of what they do is great and that they manage to act ethically most of the time.

  • Turn Around (Score:4, Insightful)

    by oshkrozz ( 1051896 ) on Monday June 12, 2017 @07:47AM (#54601051)
    Although mentioned in passing that Lego is a private company, that very fact is what has kept them around for so long. The customers of Lego are the actual people that buy the products and services, not the boardroom. This has given them far more flexibility then quarterly earning reports would.
  • They must have a design by now that doesn't hurt when you step on it and are just waiting for the right time to release it.

    Their business would double overnight from everyone having to rebuy and the large number of parents that would now be ok having them in their house.

  • "It’s about discovering what’s obviously Lego, but has never been seen before."

    https://www.fastcompany.com/30... [fastcompany.com]

  • by ledow ( 319597 )

    Company that sells bricks sells more bricks when they sell bricks that people want to buy.

    Honestly, I should sell my services as a consultant.

  • Excellent documentary about the interaction of Lego user clubs and the parent company. I hope to attend a lego convention one of these years.

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