Subject:
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Re: Are *we* part of TLG's problem?
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Newsgroups:
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lugnet.general
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Date:
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Sun, 24 Oct 2004 04:24:54 GMT
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Viewed:
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737 times
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In lugnet.general, Chris Gray wrote:
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I’ve been reading the recent articles about The Lego Group’s financial
problems. Its sad to see a company with a long history of good practices
in trouble.
But, it has occurred to me that we AFOL’s might be part of the problem.
What do we do? Well, we buy lots of Lego - often far more than parents
would ever buy for their children, and certainly far more than kids could
ever buy for themselves. But, and here is the big thing, we do our best to
buy most of our Lego on sale. We do that because we want lots of it, and
because it is expensive.
I know that there is a large markup on Toys, so stores have quite a bit
of ability to sell at reduced prices without losing money. But, I’m thinking
that the stores don’t absorb all of that reduced price. I’m thinking that
Lego takes some of the hit too. Consider also the recent sale items
available at Shop@Home. Sure, this is old stock that Lego needs to sell
off, but they are most certainly making less money from the reduced prices
(some as much as 50% off).
I only need to look at what happens here in Edmonton to know that this
can’t be good for someone, and I’m guessing that Lego itself is part of
that unknown “someone”. Whenever sales of interesting sets are spotted
by any of our members (some of who check the stores almost every day),
an email about it is posted to our mailing list. The result is often a
horde of locusts descending on the stores, buying up all of the on-sale
items. Some goes into personal collections for use, and some ends up in
online stores. Judging by the size of some online stores, we certainly
aren’t the only group that does this, and there are likely other groups
that are worse than we are.
When we buy up all of the stuff on sale, that means that parents and kids
can’t buy it. That means there are fewer people exposed to more Lego, and
quite possibly there is then less demand for new sets at regular prices.
In the past, perhaps the effect we had wasn’t that big. But, it seems to
me, looking at projects people are doing, that the size of the projects
is steadily increasing. That means the amount of Lego being bought (and
how often is that at full retail price?) by AFOLs is increasing. Are we
in fact contributing to the trend of fewer new young Lego fans because
we are buying up all the cheap Lego?
Do we compensate for all of this by getting more people interested in Lego?
Probably not, because what we do is just increase the number of people who
are not paying full retail price!
Another possible contributor is the tremendous consolidation of the retail
market for toys. What percentage does Walmart sell in the U.S.? Do you
think they pay as much for their huge bulk buys as other stores do? I think
we’ve heard in the past that they most definitely don’t. This is yet
another reduction in income for Lego, for the same production costs.
Comments?
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All good points! And while we (AFOL) might be contributing to the overall
problem like you show we are a small percentage of the problem. AFOLs for all
their wallet power (AKA $$$) are only a very tiny fraction of the total sales of
LEGO.
The biggest problem with LEGO (in my opinon) are the kids and their culture
themseleves! Kids grow up (or think they are more grown up) faster than every
before. I remember playing with LEGO and my GI Joes until I graduated 11th
grade in high school *cough* when I traded those in for girls. *cough* =)
My baby sister is in 10th grade and do you know that last time she played with a
toy... 4th grade! 4th grade! I asked her freinds during her brithday party a
few months ago in private if they still played with any type of toy (I was
building a tie bomber at the time) and of the 15 boys and girl she had over only
the boy scout kid (admitted to me that he still plays with hot wheels!) The
rest stop playing with their toys whenthey got to middle school (6th grade)!
As is typically of most US kids the boys (which LEGO is really target for) don’t
play with cars, action figures or LEGO. They play with video games! Those few
that do play with the other toys eventually get “pushed” into the video game
relm due to their friends. So you see we might contribute to the problem but
the US “kid culuture” is the biggest factor. The US market has stopped
marketing to “teens” and are now hitting the “tweens (age 8-13)” with all the
stuff they use to hit the teens and young adults with.
Even if you have a “tween” who still plays with toys s/he won’t admit it to
his/her peers. They might play alone but in the end the peer pressure is too
great and the toys go out the windows for a cellphone, “dating”, “hanging out at
the malls”, etc...
The age of inoccence as we knew it is no more. TLC as all the other toy makers
have a smaller and smaller window to capture the attention of the kids.
That boys and girls is the major problem in the US Market.
-AHui
A&M LWorks
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Message has 2 Replies:
 | | Re: Are *we* part of TLG's problem?
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| (...) I agree. It's the "Kool Kids" culture that Madison Avenue advertising (can you say "low-carb food") and Hollywood (TV/Movies) propogate. No wonder the rest of the world hates the USA (well that and our current president). But I don't think (...) (20 years ago, 24-Oct-04, to lugnet.general, FTX)
| | | Re: Are *we* part of TLG's problem?
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| (...) I've been wondering about this for a while. I've played with LEGO my whole life, but I didn't get my first Legoland set (Space Dart I Value Pack from 1984) until my 7th birthday. It wasn't until 1986 when I was 9 years old that I really got (...) (20 years ago, 24-Oct-04, to lugnet.general, FTX)
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Message is in Reply To:
| | Are *we* part of TLG's problem?
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| I've been reading the recent articles about The Lego Group's financial problems. Its sad to see a company with a long history of good practices in trouble. But, it has occurred to me that we AFOL's might be part of the problem. What do we do? Well, (...) (20 years ago, 23-Oct-04, to lugnet.general)
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