Marketing Strategy of Lego

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Introduction

Lego is a leading brand name in the Toy industry. The company was founded by Kirk Kristiansen in 1932. It is a family owned business located in Denmark. However, starting from its humble beginnings in early 30s, the company has come a long way to become a global business with strong brand recognition. The toy industry has undergone rapid changes during the recent years driven mainly by higher digitalization. Lego is famous for its lego bricks and toy sets. However, the brand is equally excellent in terms of marketing as its products. Heavy sales and growth of Lego are a result of consistent focus upon quality combined with a perfect marketing strategy.

Due to the growing competition in the Toy industry, Lego has grown its focus upon customer engagement as well as product quality and customer relationships. 2018 was a challenging year for the industry. However, Lego maintained stable financial performance with modest top and bottom line growth. The company has brought a large range of products for kids and adolescents ranging from Lego bricks to toy sets and web games. From time to time, it has used marketing campaigns to drive brand awareness and popularity as well as sales growth. Lego has also been named Toy of the Century twice. 

Target Market :-

The target audience of Lego is mainly the kids in 1 to 15 years age group. However, the company also has a large base of customers and followers among the grown ups. Lego has brought special products for customers segmented on the basis of age. For example, there are simple toys for the 1 to 3 years old and bigger, higher complexity toys and toy sets for kids above 10 years. Apart from that, Lego has brought a large range of games to engage the adolescents and grown ups.

Marketing channels : –

Lego utilizes a variety of marketing channels including traditional and modern. Traditionally, it has relied upon tools like media publications, magazines, in-store promotions and campaigns for marketing. However, with time a lot has changed about its marketing strategy and the brand is using digital tools in plenty for marketing its brand and products. It is also using digital technology for customer engagement and to connect with customers.

Digital campaigns are now an integral part of its marketing strategy. The brand has also grown its investment in marketing. The sales and distribution expenses of Lego which include its advertising and promotion costs were 2.66 billion Danish Krone in 2018. Apart from its own websites, gaming websites and e-commerce channels, the brand is using other digital tools too for marketing and promotions as well as customer engagement.

 

Marketing Campaigns and customer engagement :-

Customer engagement and customer relationships management have become all the more important in the context of marketing for international brands.   To connect with its customers, the company created an online community of Lego fans. This community has around a million adult members. Lego launches four products each year based upon the designs proposed by these members. However, for an idea to win, it must have at  least 10,000 votes. Ideas having received more than 10,000 votes are sent to a panel of experts for consideration.

A “Women of NASA” idea proposed by journalist Maia Weinstock in 2017, managed to pass through and became a best seller on Amazon right within 24 hours of launch. The lego ‘Millenium Falcon’ model created by the company in 2017 is also one of its largest sets. These products are also highly useful in terms of marketing and apart from generating publicity they also drive higher sales. Lego has brought products and product sets based on several themes including ‘Star Wars’ and ‘DC heroes’. The focus of Lego is now on customer experience and on making the best use of digital technology to create safer experiences for both children and adults. 

Social Media marketing :-

Social media is also an important part of the marketing strategy of Lego and from Facebook to YouTube, the brand is actively using all these channels to grow its customer base and engage followers. Lego has more than 13 million followers on Facebook. It has also achieved excellent user engagement rate on Facebook. The company makes 1 to 2 posts daily and most of these receive thousands of likes. While this on the one hand shows the popularity of Lego as a brand, on the other, it also proves that Facebook can be an excellent marketing and customer engagement channel for toys, games and entertainment brands.

Instagram is also one of the leading marketing channels Lego uses. On Insta, Lego has more than 4 million followers. The company shares both images and videos through Instagram and has achieved a highly attractive level of engagement through the image and video sharing, social networking website. Some of these posts have received more than 100K likes.

Video marketing is also an important part of Lego’s marketing strategy. The company regularly publishes videos through its YouTube account. It has around 7 million followers on Youtube. The company uses Youtube to publish videos of all kinds including educational and promotional videos where the aim is to raise brand awareness, drive sales and also grow the number of fans and followers.