Lego: Strategy Analysis & Business Model
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Transcript of Lego: Strategy Analysis & Business Model
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Evgenii, Roelof & Sjoerd
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TEN slides - TEN models1. PESTLE 2. Porters five forces 3. Market life cycle4. Value chain5. Core problem
6. Confrontation matrix7. Canvas model8. Canvas model +59. International strategy10. Ansoff's model
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Mission, Vision & Brand ValuesMission: ‘Invent the future of PLAY’
Vision: ‘Inspire and develop the builders of TOMORROW’
Values: • Imagination • Creativity• Quality• Learning• CARE!
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Company History & Profile1932 – Started by Kirk Kristiansen – “Only the best is good enough”
1958 – Plastic cubes were introduced – “There’s one word I can say - ‘plastics’
1966 – Lego train toy – “Who said you can’t have a train in your house?’
1968 – Legoland Park in Billund – “Now you can be LEGO too”
1988 – Lego World Cup – “Show the world how good you are”
1997 – Lego Video Game – “You won’t lose your bricks anymore
2012 – Four billion minifigures produced – “Now we are the world’s biggest
population group”
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PEST analysisPolitical
• Adverse geopolitical representation
• Gender neutrality
• Corporate tax games
• Labor politics
Economic
• Currency fluctuations
• Positive economic downturn
• Advanced Economies Growth
Social Technological
• OECD Fertility Rates
• Targeting China and India
• Renewable Energy & Zero Waste Prog-s
• Three Dimensional Printing
• Virtual Platform Development
• Tablet & Mobile Market
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Five Forces AnalysisThreat of new entrants – moderate (patents, oil prices) Threat of substitutes – high (simplicity, design, China)Bargaining power of customers – high (B2B, retailers control)Bargaining power of suppliers – high (Oil, Chem&film mkt, CoC)Intensity of rivalry – low (distribution channels, online sales)Complementors – moderate (Mega Blocks, Mattel, Oxford Toys)
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Market Life Cycle
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Value chain Model
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LEGO has only 1 product,
which is easy to copy.
Core problem
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Strenghts – iconic brand, product portfolio, experience
Weaknesses – size, easy to copy , only variations on one theme
Opportunities – NEM (Asia), complex logistics, complementors
Threats – trends, competition, lack of legal protection
SWOT analysis
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Confrontation matrixSWOT Asia Logistics Partners Trends Legal Competition
Brand ++ o ++ ++ - +
Portfolio ++ ++ ++ + -- o
Experience ++ ++ o ++ o +
Size + o + -- + +
Copy -- o - o -- --
Theme o o + -- o --
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C Ma o n dv ea ls
DisneyWarnerEASonyParamountSchools
LegoDuploFriendsLegolandGamesVideoMovieEducation
ChildrenAdults
Families that are themepark visitors
Children in schools
ProducingPromotingR&D
HRInspirationBrands
StoresLegolandSchools
CSRPick-a-brickDesign
Production R&DPromotion Legoland & stores
Purchases AdvertisingTickets Partnerships
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C Ma o n dv ea lS +5
Great wall film company
Annapurna studios
School system
IKEA
Lego
Great Wall
Bollywood
Furniture
Art
Education
ChildrenAdults
Families that are themepark visitors
Children in schools
ProducingPromotingR&D
HRInspirationBrands
StoresLegolandSchools
Popular movies/characters
Production R&DPromotion Legoland & stores
Purchases AdvertisingTickets Partnerships
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International strategy
HIGH
LOW
GeographicallyDispersed
GeographicallyConcentrated
Configuration ofActivities
Coordination ofActivities LEGO
Oxford Toys
Mattel
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Ansoff’s strategic diagnosis model
…
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Strategic recommendations• Invest in emerging markets (China, India, Mexico)
• Increase market share in Eastern Europe
• Expand ‘direct to customer’ activities
• Increase Product Placement in Movies
• Find more complementors & make exclusive agreements
• Expand Lego Friends segment