Subject:
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Re: Article text
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Newsgroups:
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lugnet.general
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Date:
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Mon, 1 Mar 2004 05:25:53 GMT
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Viewed:
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840 times
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In lugnet.general, Ken Nagel wrote:
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The store only sells merchandise. If it’s not selling then somebody is doing
a pretty poor job of marketing it.
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That’s not always true. Ever heard of something called the Law of Supply and
Demand? Demand has dropped because all of the people who absolutely had to buy
it did. Then the people who kinda had to buy it did. Then the people who sorta
wanted to buy it did. Finally, people who were holding out until it hit
clearance prices did. The market for the original Hogwarts has shrunk
dramatically, whether you’re willing to admit it or not. A brand-new Hogwarts
will enjoy the benefit of an mostly-unsaturated market. Yes, there will be
people who tell their kids that they already have a Hogwarts Castle and don’t
need another, but there is no way on earth, short of selling it at reduced
price, that the original Hogwarts could possibly outsell a refreshed Hogwarts in
2004.
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Hogwarts was expensive to produce because of the licencing fees.
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Yup, the design process for a set of that size, the development of new pieces,
and the cost of actually manufacturing it have no bearing on how expensive it
was to produce. None whatsoever.
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Instead of selling to the maximum market thus maximizing the profit they are
watching it fade in popularity.
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So you think that maximizing the profit on a single set makes more sense than
maximizing the profit of the company as a whole? Why not switch over to only
producing new sets for a given theme every three years? That way you can make
sure that every possible customer will have a shot at buying one. Of course,
all of the “buy everything” customers will buy 1/3rd as much stuff, but who
cares? It’s all about making sure that there’s not one unsatiated customer left
on the face of the earth, even if it requires calling every family and asking
them if they still need a copy.
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You can can argue this but it’s foolish as by Lego’s own admission they are
failures at making a profit with licenced lines.
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Show me concrete proof of that statement. Show me where they specifically
stated that they can’t make a profit at licensed lines. Star Wars is
profitable. Harry Potter is profitable. They’re two of the top five
best-selling themes. Spiderman...well, I’m sure it’s bringing in sales, but I’m
not sure how many compared to the other two movie licenses (two sets wasn’t
enough to hit the Top 5 list for 2002, and I haven’t seen one for 2003). Winnie
the Pooh was a bit problematic, but that’s because Disney sold them the rights
to produce it when they didn’t actually own said rights to sell. Galidor was a
flop, but that’s because the TV show was, not because the sets were designed
poorly. Bob the Builder sold well, as Dora the Explorer likely will. The
Ferrari sets are drawing a lot of attention already, though some of the NASA
sets (the Mars mission sets, in particular) should have been released much
closer to the Rover landings.
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Message has 1 Reply:
 | | Re: Article text
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| (...) Of corse I've heard of supply & demand. I'm the first to admit the castle sales slowed. That left Lego with two choices... 1)redesign the set 2)increase the demand. One of these choices is signifgantly more costly. Since they are whining about (...) (20 years ago, 1-Mar-04, to lugnet.general, FTX)
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Message is in Reply To:
| | Re: Article text
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| (...) The store only sells merchandise. If it's not selling then somebody is doing a pretty poor job of marketing it. That would be... oh, yea the guys with the weak shoulders... Hogwarts was expensive to produce because of the licencing fees. (...) (20 years ago, 1-Mar-04, to lugnet.general, FTX)
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