Lego Analysis

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Table of Contents 1. Introduction2 2. Company Background3 3. Market Analysis4 3.1 General Situation 4 3.2 Toy Industry in China 6 3.3 Market Capacity in China 6 3.4 Customer Analysis 7 3.5 Competitor Analysis 7 3.6 Supplier Analysis7 4. LEGO’s Development in China8 5. LEGO’s Strategies in Chinese Market 9 5.1 Rapidly Expanding Retail Shops Both Online and Offline 9 5.2 Offering Special Versions of Products 10 5.3 Marketing Promotion 10 5.4 Telling a Good Story 11 5.5 No Compromise to Quality and Safety Problems 11 5.6 Understanding Customers Better 12 5.7 Stressing the Importance of Education 12 6. Potential Challenges LEGO Will Be Facing13 6.1 Electronic Entertainment Challenges 13 6.2 Copycat Challenges 14 6.3 Legal Challenges 14 6.4 Quality Challenges 14 7. Conclusion14 8. Reference16 LEGO Group’s development in China 1. Introduction Profit Sales Profit Sales Famous for its little colorful bricks, LEGO is one of the world’s most well-known toy manufacturers. Currently, the company is the world’s 2nd largest toy manufacturer. Once combined with imagination, those fundamental normal bricks can transform into a variety of figures and subjects. Not only teens, Lego also has accumulated a huge number of adult followers worldwide, who made up nearly 5% of LEGO’s customers. They even have their own acronym – AFOL (stands for Adult Fans of Lego). LEGO has a huge user base in Western countries, where parents grew up with LEGO bricks and thus have a strong customer loyalty. In Northern Europe, a typical LEGO player has on average 8 sets of LEGO products. Figure 1: LEGO’s Profit and Sales from 1997 to 2011 The development of the toy giant is not always smooth. As shown in Figure 1, the company suffered huge loss and a decrease in sales from 2002 to 2004. LEGO’s original focus was Western Europe and North America

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