Anyone who has ever heard of LEGO® immediately thinks of the popular building bricks. But perhaps not everybody knows that behind this successful invention there are many other valid products and a century-old history punctuated by success stories and failures, too. http://bit.ly/pjl45-thelegostory

Andrea Dovichi and Luca Silva - Studio Wasabi

The adventure begins in 1916 when a Danish carpenter, Ole Kirk Christiansen, opened a workshop in Billund to build houses and furniture for the region’s farmers. His shop burned down in 1924 in a fire (caused by mistake by one of his young children). Undaunted, Ole Kirk took the disaster as an opportunity to build a larger workshop but the Great Depression of 1929 would soon impact his livelihood. In finding ways to minimize costs, Ole Kirk began producing miniature versions of his products as design aids and soon begins making wooden toys, enjoying a modest amount of success. Families were poor and often unable to afford such toys and so Ole Kirk had to continue producing practical furniture in addition to toys in order to stay in business.

IN THE MID-1930S, the yo-yo toy fad gave him a brief period of activity, until it suddenly collapsed. Once again, Ole Kirk turned disadvantage to his favor, transforming the disused yo-yo parts into wheels for toy trucks. His son Godfred began working for him, taking an active role in the company. It was in 1934 that the company name “Lego”, a self-made contraction from the Danish phrase leg godt, meaning “play well”, was coined. At the end of the 1940s, when plastic came into widespread use, Ole Kirk kept up with the times and began producing plastic toys: a truck that could be taken apart and re-assembled. In 1947, father and son obtained samples of interlocking plastic bricks produced by the company Kiddicraft. The LEGO® bricks were not the first of their kind: others existed in plastic, inspired in turn by wooden bricks, differing in the position of the studs on top used to fix one building block to another, and having a hollow rectangular bottom.

IN 1949 THE LEGO GROUP BEGAN PRODUCING WHAT THEY CALLED “AUTOMATIC BINDING BRICKS” manufactured from cellulose acetate, and in 1953, the bricks were given a new name: LEGO® Mursten, or “LEGO® Bricks”. But the success that we all know today did not arrive immediately. The use of plastic for toy manufacture was not highly regarded by retailers and consumers of the time. Additionally, the blocks still had some versatility issues to be resolved and did not allow for many locking possibilities. By 1954, Godtfred had become the junior managing director of the LEGO® Group and promptly tried to solve these problems, succeeding in doing so in 1958, the year that the modern-day brick design was developed. The main evolution was the introduction of bricks with hollow tubes on their underside, enabling better locking ability and improved versatility. That same year, Ole Kirk Christiansen died, and Godtfred inherited leadership of the company that greatly expands. Showing the same entrepreneurial farsightedness as his father, he created the “Futura” division (responsible for generating ideas for new sets). We cannot yet speak of a true marketing strategy, but the behavior of the two entrepreneurs - father and son - illustrates the interest and inclination to becoming market leaders.

ANOTHER WAREHOUSE FIRE STRUCK THE LEGO GROUP IN 1960, CONSUMING MOST OF THE COMPANY’S INVENTORY OF WOODEN TOYS, and this production was abandoned. Many product innovations arose: wheels were “invented”, allowing to produce vehicle models; ABS plastic (acrylonitrile-butadiene-styrene) replaced cellulose acetate to make non-toxic pieces, less subject to deformation and color fading (it is interesting to note that the building blocks produced in those years still preserve their natural color and shape and can be locked in with those produced today). This may seem just an added value, but it is instead an extremely important characteristic from a marketing point of view because it confers the product a strong identity, making it easily recognizable on the market. In 1968 LEGO® took the first step in a different direction from games and toys, but always remaining true to its building blocks. Billund, native city of the Christiansen family and headquarters of the company, inaugurated Legoland, a LEGO® theme park. The next year, to broaden its reference target, the LEGO® Duplo line was launched, characterized by larger bricks, safer for younger children. The two systems are compatible: Lego bricks can be fitted neatly onto Duplo bricks, making the transition to the Lego system easier for older children.

THE 1970S SAW AN EXPANSION OF THE COMPANY IN TERMS OF STAFF AND A SHARP RISE IN TURNOVER. Godfred’s son, Kjeld Kirk Kristiansen (his last name has a “K” instead of the “Ch” due to a mistake, never corrected, by the birth registration officer) joined the managerial staff, having worked his way up from the design of new sets. Kjeld, business expert thanks to college degrees earned in Switzerland and Denmark, immediately decided to create a new research and development department that would be responsible for keeping the company’s raw materials and manufacturing methods up to date. Kjeld certainly inherited this propensity for innovation from his grandfather Ole who was one of the first to introduce plastic as raw material for his toys. During these years, the focus in concentrated on children’s preferences and “demands”, and specific sets are produced for different market fields: for girls (1971), sets dedicated to transportation (1972), sets for expert builders (1975) and for adolescents, and 1977 saw the birth of the line that in 1981 will take on the new name of LEGO® Technic.

A NEW MILESTONE IN THE HISTORY OF THE LEGO® WORLD ARRIVES IN 1978 with the introduction of “minifigures”: the little yellow people. In reality, the introduction of anthropomorphic figures had already been experimented in previous years but with poor results. Expansion continued in the ‘80s: new divisions were inaugurated, first among them the Educational Products Department (Kjeld’s purpose is not just to build fun toys but above all to create toys that also focus on the educational aspect – a very important factor for parents, the ones who have the ultimate purchase decision). Riding the company’s wave of success, in 1987 the LEGO® Club Magazine is published. It is a magazine for LEGO® enthusiasts born simultaneously with the official brick lovers’ Club. And in addition, several independent organizations are born, such as the ItLUG association in Italy in 1999 as an independent community of LEGO® enthusiasts; the AFOL (Adult Fans Of LEGO®) that in 2010 became an officially constituted Cultural Association for Social Promotion. These independent Clubs are not sponsored by the LEGO® Group at all, but the Group acknowledges them to the extent that in 2006 it instituted the figure of the LUG Ambassador who represents them within the company itself.

PRODUCT EVOLUTION TOOK PLACE IN 1999 with the launch of the first computer-programmable system comprised of a control panel, a cable and a card to be installed in the PC. This, together with two engines previously sold (in 1966 and 1977), sets the foundations for one of the company’s most successful products: the LEGO® Mindstorm set. In these years, the bricks’ most popular colors were red, yellow, blue, black, white and light gray. Other colors were added but not green because LEGO® feared that they will be used to build military vehicles, associating the product with war. Green was added later following a change in the company’s behavioral policy.

FOR THE SKIN COLOR OF THE MINIFIGURES, yellow was used exclusively for many years and the expression was always the same, too, while starting from the LEGO® Pirates line, new facial expressions are introduced. In 2000, as if further confirmation of the success of the bricks was needed, both Fortune Magazine and the British Toy Retailers Association elect LEGO® toy of the century. But despite these openings to new markets and recognitions obtained, LEGO® closed 2003 with a 188-million euro deficit; the President resigned and Kjeld once again took over the reins of the company. The following year, however, loss was even higher. Kjeld resigned and placed about 130 million euro of his own private funds into the company. “The Lego Case Study” (that can be found on the website having the same name) documents how after two years of deficit the company was able to turn itself around. A foundational element to overcome the crisis was setting up a partnership with Disney (and later with other famous brand owners) to start producing theme sets. Still in 2003 the company produced the first official film featuring LEGO® building bricks. Already back in the ‘70s, LEGO® fans produced the first Brickfilms (short films created by combining the stop motion technique with the famous bricks) and came together in a community of fans that meet on the website BrickinMotion.com. Many other LEGO® films have come out in DVD or as TV series until 2014, when “The LEGO® Movie” came to theaters worldwide (http://bit.ly/pjl45-legofilms). These productions, both big and small, bear witness to the fact that after the period of crisis, the company was able to turn itself around by opening up and undertaking partnerships with film studios, too. In an effort to attract a different audience – this time prevalently adult – the LEGO® Cuusoo project was undertaken (later renamed LEGO® Ideas). Users can propose prototypes of sets that are then assessed by other brick enthusiasts. If 10,000 favorable votes are obtained, then the project passes to the company’s R&D department who may decide on the feasibility of putting it into production. Of course, the name of the designer – who will receive 1% of the sales profits of that set – is disclosed. Thirteen prototypes have already been put into production, among which the car from Ghostbusters and the Delorean from Back to the Future (in the flying version, too), and sets inspired by the most popular TV shows (The Big Bang Theory, Doctor Who) and many others (https://en.wikipedia.org/wiki/Lego_Ideas).

AT THIS POINT, LOOKING BACK ON ALMOST 100 YEARS OF THE COMPANY’S HISTORY, we can safely state that success was due not only to the optimal quality of the product but also to the attention to consumers’ requests (both children and adults), to their natural mutations in time and meeting these needs was possible also thanks to the partnerships we spoke about earlier. The strategy adopted by LEGO® on social networks, too, must be kept into consideration: from 2012, it has improved considerably and succeeded in engrossing the general public. Naturally, the enthusiasm that the bricks arouse in those who buy them is foundational and the Danish Group’s strategy is based on this aspect. According to Lars Silberbauer Andersen, responsible for LEGO®’s social networks, in order to have success online you must create a long-lasting relation with your users strengthened through interaction. His strategy was to drastically cut funds to the communications department to make the team focus more on the dynamics of communication than on how to invest money. This is how the “Life of George” campaign was born, where the public was asked to build the famous mascot, photograph it in the most disparate environments and post the pictures on Facebook. Within a few hours, an infinite amount of photos had already been shared and each of them obtained hundreds of likes.

THIS YEAR, A NEW CAMPAIGN WAS LAUNCHED WHERE ADULTS AND CHILDREN could build a kronkiwongi and post the photo on the FB page. “An adult may have no idea of what it is” says Andersen, since it is a an invented term that before the campaign gave no search results on Google, Twitter, Facebook or Instagram, “But children have demonstrated that they have very clear and original ideas: in just one week, the results were incredible”. (http://bit.ly/pjl45-kronkiwongi). And in June 2015 a new campaign was launched in Italy to involve the public and build a tower of bricks together #torredarecord (http://bit.ly/pjl45-torredarecord) These examples prove that LEGO® is one of those brands that has found success on social networks without recurring to tricks or shortcuts but simply by studying users’ demands and answering the needs of its target audience with timeliness, courage and personality!

AND WHAT ABOUT CUSTOMER CARE? Well, LEGO® has always been a sensitive company at the vanguard. You don’t think so? Here’s the story of a 7-year old child who had lost an accessory of a character series and what the company answered him. A fantastic handling of the situation by management and a very sweet story. http://bit.ly/pjl45-letteraallalego We have examined the behavior of the company’s management in the course of the years, the different improvements brought to the products, the openings towards market branches different from toys, the strategy adopted on social networks. But what about LEGO®’s behavior in post-sales? Going back to what we said at the beginning of the article, when we think of LEGO® we immediately think of boxes full of small pieces with which to build our wonderful sets. But what if one of those pieces was missing? As further testimony of the fact that the special attention dedicated to the public contributes to making LEGO® a leader in the field of toys, we can say that all you have to do is go to the website, request the missing piece and wait for the package to arrive with no added costs! And if we wanted to create something new starting from a photograph or an image? Here is the address of the Legoizer site that turn your projects into reality: (http://bit.ly/pjl45-legoizer) As a conclusion to this article, we would like to speak about how LEGO® has renewed itself by interacting with the audience. A perfect case-in-point is Brickmented Reality: Christmas 2012 saw the start-up of the Happy Holiplay project, the right mix between reality and bricks (http://bit.ly/pjl45-happyholiplay) Everyone loves LEGO® ... to the point of creating stackable jelly candies: (http://bit.ly/pjl45-legocandies).This fantastic company has shown that it is not only attentive to detail, capable of reacting, innovating, listening to the public and acknowledging its mistakes, trying to fix them, but also capable of “opening itself up” to consumers and seizing opportunities even in the worst of times. Just what every company should do today in order to be competitive.

Sources: lego.com, , wikipedia, adnKronos, ItLUG.org Thelegocasestudy.com, Wired.it/

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