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From $800m in debt to $660m in profit. Hear about how engaging with Lego customers changed everything for this business.

TRANSCRIPT – BRANDING BEFORE BREAKFAST EP49

Hi, today I want to dedicate the next two minutes to talking about how really listening to your consumers can revolutionise your brand. And I think the best way to look at this is by looking at a company that has been there, done that and bought the T-shirt, and that is Lego. A family-owned business, actually. They founded in 1932 and until 1998 it was all plain sailing. They never posted a loss. But over the next five years, by 2003 sales were down and they were 800 million in debts. Fast forward another five years and profits had quadrupled, outstripping Apple’s. So that by 2015 they were 660 million in profit. How did they do this? So they would do things that I guess you would immediately think of. They had diversified into theme parks and they had to stop doing all of that. They had moved into products that weren’t true to the brick and they stopped doing those things and interestingly, and I think most importantly, they actually started engaging with Lego fans. Something which previously had been a no-go area.They introduced a crowdsourcing competition. Winners from that competition would get 1% of the sales. That was where they discovered their Ninjago line Lego. Designers had actually been focusing on superheroes, but through crowdsourcing they discovered that ninjas was where it was at and Lego Friends allowed them to crack the girls market. It took four years of research. Lego do the largest ethnographic study of children in the world.They call it ‘camping with consumers’. They found that boys were all about good vs evil.They weren’t too into the details. Whereas girls found the mini block figures too difficult to relate to. They had a stronger sense of realism and wanted the figures to represent themselves. And my most favourite bit by far, when they introduced a loo to the sets that you could build in Lego Friends sales went through the roof. Boys couldn’t give two hoots but girls had that pragmatism and needed to know that a toilet was available. So today, have a thing about how you can engage with your consumers. What can they bring to the way that you are developing your brand and the products that you have out there. That’s it from me. Time for brekkie.

Written by: Jo Whelan
Published: June 15, 2020