Lego builds greater communication with shoppers
With the continued trend for consolidation among retailers around the world Lego is finding the best way to promote its brand is to engage with customers through the various other channels available to it including its website, catalogue, magazine and Legoland theme parks.
By Glynn Davis in Barcelona
Speaking at the World Retail Congress in Barcelona Matt Harker, vice president of operations for consumer, education and direct at Lego, says: “Demand is consolidating to fewer more-powerful retailers, which chokes us off in conveying our messages. We need these retailers in order to get our product out into the marketplace but we’re now looking towards using our other channels to communicate more to consumers.”
This is increasingly involving the use of digital channels so the company is engaging with Lego-related groups on Facebook as well as through its website that is transactional in 23 countries. This is in addition to it communicating more through its 35 company-owned stores, its magazine that has 3.5 million subscribers, its massively successful Robotics competitions that are held around the world, and its Legoland theme parks.
By connecting with customers through these various channels, Harker has the objective of pushing consumers further up the company’s communications pyramid, which has one-to-one marketing at the pinnacle. “When we end up communicating on a one-to-one basis then these customers deliver five times the average spend and have a higher frequency of spending,” he explains.
He says that Lego is fortunate in having such a powerful brand as this makes it a lot easier to gain “permission” from customers to let the company communicate with them: “Fifty per cent of people who buy a product with us have some form of interaction with us and let us market to them.” When these people become fully engaged then they recommend Lego to other consumers, which then provides a further opportunity to push more people up its communications pyramid.
To increase the number of ‘tough points’ for consumers Harker says Lego is adding 15 new stores this year and is developing new formats with two new concept stores due to open in the US in the third quarter of this year. These outlets will be offering teaching classes and will further enhance the Lego in-store experience that Harker says has some similarities with that of the Apple stores.
Lego also intends to launch a multi-player online game in 2010 whereby players can “create their own characters, build things, play with others and connect with people around the world”. Harker also highlights that the company’s tough points do not necessarily have to be Lego-owned as the theme parks are operated by Merlin Group: “Sometimes it does not make sense to do it ourselves as we can’t do it as well…but it is still a touch point for consumers.”
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