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Table of Contents
INTRODUCTION ............................................................................................................................................ 2
BRAND EQUITY……………………………………………………………………………………………………………………………………….3
BRAND EQUITY OF LEGO…………………………………………………………………………………………………………………….……….3
CLEAR PRODUCT……………………………………………………………………………………………………………………………..…………3
FUN………………………………………………………………………………………………………………………………………………………….3
BRICK INTELLIGENCE…………………………………………………………………………………………………………………………………..4
COLORFUL AND CREATIVE……………………………………………………………………………………………………………………………4
HOW LEGO CREATED BRAND EQUITY……………………………………………………………………………………………………………4
FOCUSING BACK ON KEY SEGMENT………………………………………………………………………………………………………………4
COMPETITIVE ANALYSIS………………………………………………………………………………………………………………………………5
MARKET OFFERINGS……………………………………………………………………………………………………………………………….6
BRAND POSITIONING………………………………………………………………………………………………………………………………….6
SHAPING THE MARKET OFFERING…………………………………………………………………………………………………………………7
PRICING STRATEGY………………………………………………………………………………………………………………………………..7
DELIVERY VALUE……………………………………………………………………………………………………………………………………..8
COMMUNICATING VALUE……………………………………………………………………………………………………………………….9
CEATING SUCCESSFUL LONG TERM GROWTH………………………………………………………………………………………10
REFERENCES…………………………………………………………………………………………………………………………………………12
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Introduction
Lego is considered as one of the leading companies of toys in the world, this is largest retailer of
toys. In various surveys Lego is considered as number one company. Lego is a family based
Denmark company initiated in 1932. In Latin Lego means I tie or I collect, (Davidson 2014, p.
1).
This paper explores different aspects of LEGO Company. Brand equality and its competitions
are explored. LEGO always want to develop nurture and educational aspect in its toys. It needs
to develop more advertisement and distributive strategies to reach to better retailers. Personal
shops are also very much required to develop exclusivity in marketing. It is working on movies,
LEGOLAND parks and social media strategies. The product positioning is done because of
uniqueness and the strong message that LEGO products deliver. It is advised that old products of
LEGO must be sold on higher prices; the set prices are higher than single piece prices due to
which it is only good for retail business. Another positioning strategy is to reach the customers at
right time, for this purpose it is shaping its retailers.
It expects to target teenagers and girls as well. More colors and career kits are present in girls
segment, but social media strategy and movie working can provide it extra benefit in market
shaping. The other is to open own shops in which element of individuality is not ignored by
working more on the new products. On the other hand, the firm must not only manage the
profitability on set of pieces but on individual pieces as well. It can be said that the company is
lacking in property retailing and proper ways to reach the market.
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Lego valued and managed its brand equity
Brand equity
Brand equity is value of a brand in the market which defines that how much
Good name the company holds. This is an idea that owner of the product can generate
much money because of his name. The consumer’s expectations and satisfaction levels
are very much reacted to the brand equality.
Brand equality of Lego
The equality return has increased from zero to seventy percent,
On the other hand there is one other type of brand equality which is
Consumer based, in this in just eight working years Lego has tripled its
Revenue which shows that it is a consumer based brand equality. The equality
Has increased from 400 million to 11 billion DKK, (Ashcroft 2014, p. 3).
The consumers have really good image about Lego they find its product
Reliable and sustainability is there in its products.
Clear product and Longevity
It products are clear; this is a firm of toys. Though it is making some wrist watches and
lifestyle products but these are not the main product.
Fun and Educational toy for children
Lego makes sure that children must learn something from the creativity. As per Lego
Brand, “it is what children parents expect from us”, (Ashcroft 2014, p. 4).
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Intelligent Brick
The concept of intelligent brick is there, children needs to brains from to understand the
toy; moreover the professionals make it according to great brain storming. The concept
of Lego Mind storm is always present in its products, (Ashcroft 2014, p. 4).
Colorful and attractive. Create your own
The creation of children is motivated. There are some new toys as well; there are power
products such as Bionicle which is there. Now there are physical as well as online
learning opportunities in these games, a child is given challenges in these games which
help them develop their own product.
How has Lego valued their brand equity?
There are various ways adopted by brand to reach people, these ways are simple and add product
differentiation for example it is making theme parks for children who are always open and easily
reachable. These parks are called as Lego land parks. This is there to come closer to children and
develop brand equity. The computer sales and online references of games are important things
which are there. The software losses are a challenge which LEGO is trying to overcome,
(Ashcroft 2014, p. 10).
Focus back on the key brand segment
But it does not mean that producing wrist watches and development of parks has decreased value
and emphasize of toys. The essential product of company is toy. Parents and children both are
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valued. Moreover the intelligence and brain storming are there in the production process, the
purpose is not anything else but “nurture the child in every one of us”.
Lego stores were to connect with the consumers closer but had to manage the issues with
retailers.
The market potential is present in UK, USA and Japan. This year there was a plan to strengthen
the consumer experience of having Lego products and thus new twelve retail stores were opened.
The 15 total shops under these strategies were opened under this strategy to reach near
customers. The long run objectives of the firm are there to add 300 shops all around. The key
retailers of this firm are Wal-Mart, Kmart and target. Retail stores are becoming expensive and
thus there are issues present with management of retailers. Expensive direction can change the
direction of the company, (Ashcroft 2014, p. 11, 12).
Competitive Analysis
The major market competitors of Lego are Hasbro, Mattel, and Meccano.
Strengths

It is strong, unique and quality wise its products are higher.

“Sales rose from 9.5 billion DK in 2000 to 10.7 billion DK. Higher sales to the American

Market was the biggest single factor behind the increase,” (Ashcroft 2014, p. 9).

Mail order and internet sale

“Product programmer which has proved more attractive to the consumer”.
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Weaknesses

Negative development strategy.

There are premium prices.

Environmental profile is not strong, (BBC News 2014, p. 1).

The pre canned products have less utility.

Decline in US market affected sales by 35 percent where decline in Asia market affected
sales by 28 percent, (Ashcroft 2014, p. 9).
Threats

Intensified competition.

Private labels and trendy products in the market.
Opportunities

There are opportunities present in packaging, retailing and creativity.

Central European markets have good business structure.

The new products of girls and other product diversities have great scope of development.
Market Offerings
Brand Positioning
The current position of Lego is strong, it is shaping market offerings and there are market
offerings for girls, new born babies etc. the sense of touch can be developed in new born baby’s
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b providing them such toys. There are Duplo products for small children and Friends for girls.
The market leaders and competitors must not be allowed to take market share, but market share
must be enhanced by LEGO. There may be two types of technique adopted to deal with
competitors; these are defensive and offensive techniques. Increasing market share is also very
important, (Ashcroft 2014, p. 18).
Shaping the Market offerings
Lego make sure that the brand positioning is done in such a way that there is maximum brick
present. The Lego brick system is such a play in which there is so strong blocks which two years
child cannot part away. LEGO wants to get a place of master of the mould quality.
Another positioning strategy is to reach the customers at right time, for this purpose it is shaping
its retailers.
It expects to target teenagers and girls as well. More colors and career kits are present in girls
segment, but social media strategy and movie working can provide it extra benefit in market
shaping, (Alina 2014, p. 1).
The market offerings can be affected further by working on the science and industry interaction.
Innovation can take place or new designs can take place. LEGO must not indulge itself in gender
war that this toy is for boy and this is for girl but yes it can do so only to enhance segmentation.
Pricing Strategy
Star War and Harry Potters have provided lots of revenue to the firm; these are the powerful and
influential products of the company which are having high prices as well. It is advised to LEGO
not to reduce prices but to develop new ways of production which are cost effective. The product
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development and management can mingle to decide about pricing strategy, the stamp game has
provided little focus from pricing as well as management point of view, (Ashcroft 2014, p. 12).
Retailing plays a great role in deciding success of pricing strategy. Sales no doubt are going
above but bottom line is decreasing. Pricing strategy can be revised but management decision
and strategies play a role.
There is no way to decide price of bricks without knowing what set the brick is in. there are sets
which contains only 25 pieces but the promotional sets are always there and their price is vague.
In 1980s the price per piece was 0.10 $ but real price at that time was 0.30 dollars and now real
price is 0.10 $ and nominal price at 0.10 dollars as well. The price per piece is declining but
retail price is increasing. The old Lego products must have higher prices, the company must not
lose the per piece price at all, (Wordpress 2013, p. 1).
Delivering value
There are various things that LEGO can do in delivering the products, this focus on retailer such
as Wal-Mart, Kmart, and Target Toy R Us. Lego also wants to open its own stores. Moreover the
online retailing is a very good option.
Lego can place individual importance to each and every retailer; it is quite possible that new
products must be provided at Wal-Mart for the first time so most of the customers know about it.
The new products can also be used to overcome premium retailer, in this case the own stores of
LEGO can become more prominent no doubt exclusivity does matter.
The delivery value can be more if LEGO comes in interaction with schools and food stores.
There can be some rewards in schools in shape of LEGO toys. Are food shops small franchise of
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LEGO can help developing family environment in food stores as well?
Communicating Value
The communication value can be made much stronger though social media.
LEGO must rediscover its bricking system and make sure that social media knows about
it. The social media advertisement is strongly suggested because it leads to various
advantages. It is quite possible that whenever there are sales of something 30 percent off,
or whenever there are occasions like Christmas a strong message must be circulated on
behalf of LEGO on social media. Better segmentation of DUBLO, Friends and LEGO
can be done online. The website design can help in specifying customers, (Metcalf &
Lafranco 2013, pg. 1).
Interactive Marketing means including with different hybrid channels, this will help
LEGO in explaining and developing awareness about its products. There are
different hybrid groups present online. There can be reviews on hybrid regarding
its own products.
There are various software which are considered as game retailers, this software
must be used in achieving Lego objectives. This is a very famous concept if LEGO
develops online interactions with Disney and associate in its different products.
Moreover it can reach educational institutions online.
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Creating Successful long-term growth
The good base of workers is very much required. It is seen that LEGO is making quality products
but there is less in environmental profile of firm, on the other hand, the company’s employees are
not very happy from it. As per article, “The planned closure resulted in further job cuts of
approximately one hundred.” The good companies are always having good services and relations
with their employees. Employees can provide their best potential.
For better marketing strategy the management surely has to play a great role.
The successful steps that company must take are providing diverse protects, the Super Star
Destroyer in $400 is not something for children but for adults. But currently the advertisement of
LEGO is not strong, there are products for girls, teenagers who do not have children etc but they
are not aware about these products. One of the specific steps if proper advertisement. The other
is to open own shops in which element of individuality is not ignored by working more on the
new products. On the other hand, the firm must not only manage the profitability on set of
pieces but on individual pieces as well. It can be said that the company is lacking in property
retailing and proper ways to reach the market. Though it has plans for UK and Japan market as
well but it must develop good and loyal customers in UK and US before moving to new places.
There was a time when children were fighting for LEGO toys but these children are not old, new
generation is there and new revival of advertisement and marketing is required.
The successful long term growth must not ignore values of LEGO which are creativity,
education; quality, sense of community; 3D printing and creating own movies. On the other
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hand, LEGO must work along with Face Book and Disney Land to target more customers
worldwide.
LEGO must understand the needs of people that what kind of designs they require. It is possible
that citizens have something in mind, (Ashcroft 2014, p. 22).
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References
Alina, S 2014, Lego Listens to the Girls. The Copenhagen Post. Pp. 1.
Ashcroft, J 2014, The LEGO Case Study 2014. Annual Report. pp. 1-26.
BBC News 2014, “Lego 'won't renew' contract with Shell after Greenpeace campaign. Pp.1.
Davidson, J 2014, Lego Is Now The Largest Toy Company In The World. Pp.1
Metcalf, T & Lafranco, R 2013, Lego Builds New Billionaires as Toymaker Topples Mattel. Bloomberg News. Pp.1.
Wordpress, 2013. What Happened with LEGO. Pp. 1