Investing.com – The toy industry is facing its second straight year of declining sales, but Lego's success offers a silver lining. While many toy companies are struggling to maintain the sales spike they saw during the pandemic, Denmark-based Lego is seeing rapid growth. The company's revenues increased by 13% in the first half of the year, enabling it to increase its market share.
Eric Handler, managing director of Roth MKM, noted that Lego's success is driving the industry's growth this year. After nearly going bankrupt in the early 2000s, Lego transformed its business and diversified its customer base. This strategy has allowed it to boost sales even under inflationary market conditions. The company has reported positive growth in its annual revenues over the past six years.
Lego's growth strategy included licensing agreements, targeting adults and children, branching out into digital games, collaborating with studios and streaming services to deliver Lego content, and building manufacturing sites near distribution centers to streamline the supply chain.
Among the company's successful products, “emotion points”, or collections that meet the needs of a wide range of consumers, have recently been highlighted. These include fans of franchises like Star Wars and Harry Potter, car enthusiasts, and animal lovers.
James Zahn, editor-in-chief of The Toy Book, praised Lego's ability to challenge industry trends. According to Zahn, Lego tends to thrive when other companies suffer. He also credited Lego's ability to stay “ahead of the curve” with its agility during periods of inflation, disruptions in the entertainment industry, and potential tariff increases. He noted that Lego appears to be two to three steps ahead of its competitors.
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