LEGO too Awesome?

For the AFOLs out there, a peculiar trend has been noticed from the maker of those little binding bricks we love so much. Average docket values for sets have been raising and licensed sets have increased in quantity and price.

Business has been so brisk at the world’s most profitable toy manufacturer, that Lego did something unusual last year: It began looking for ways to discourage customers from buying its products.

Lego scaled back its advertising efforts amid a 25 per cent rise in annual sales, according to Reuters. Lego simply couldn’t make enough toys to quell demand in North America and Asia, and needed a break while it boosted capacity at its factories and increased its workforce by nearly a quarter.

The increase in demand in the product explains the lack of sets in stores that many AFOLs have expressed. Series 1Disney CMFs have been very difficult to find after initial release here in Australia, and many AFOLs have complained of the same issue in their countries.

Lego, has enjoyed booming growth for decades and the company’s dominance has extended into the company’s seven Legoland theme parks, 125 retail stores (none in Australia) and dozens of video games. The Lego Movie, a full-length movie released in 2014, brought in $US468.2 million ($610.4 million) at the box office.

The company’s revenue has increased by an average of 15 per cent a year in the past 12 years, according to Reuters.

The efforts to disuade demand seem to have worked. Sales in the Americas remained flat during the first half of 2016, according to the news agency. (Revenue in Asia and Europe, meanwhile, continued to grow by double digits.)

Executives at Lego are hoping to ramp up production in time for this year’s Christmas season,

Everything has been a bit too awesome for the world's most profitable toymaker, which is struggling to keep up with ...
 

“We are working very closely with our retail partners to ensure that as we go into the important holiday season, the back half of 2016, that we’ve got all of the levers pulled to get back on the growth trajectory.”

What this means on price strategy moving forward and quantity of sets remains to be seen.

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