This week Lego, which was first founded in 1932, reported that its revenues had grown 46% in the first half of this year. That's the kind of growth usually associated with tech companies or early-stage startups — not 91 year-old plastic toy brickmakers.
Brick by brick
For Lego, those remarkable results are partly down to a pandemic bump (nothing quite says "indoor activity" like building Lego), but also 15+ years of a new strategic direction.
For the first 66 years of its life, Lego never posted a loss, but by 2003 the company was in a lot of trouble. Indebted, with sales declining, Lego needed to make some changes. They decided to embrace their fans, young or old, and diversify away from the humble brick.
They gave people the ability to design their own Lego model and then buy the elements required to build it. They made Lego movies. They made Lego video games. Sold Lego city replicas. They started a YouTube channel (which now has 16 billion views). They built new Legoland theme parks (there are now 8 in total) and opened more interactive stores, shaping the entire Lego experience for fans.
But perhaps their biggest stroke of genius was to start engaging more with other brands and IP. Star Wars Lego. Marvel Lego. Harry Potter Lego. Super Mario Lego. Disney Lego. Batman Lego. The list goes on and on of mega franchise IP that Lego has tapped into — routinely charging $100, $200 or even $500, for some of the highest profile sets.
Lego is named after a Danish phrase "leg godt" — meaning "play well" — and play well they have.
