RETAIL
LEGO Sales & Profit Reach Record Highs Cementing Its Position as One of the Biggest Winners of The COVID-19 Pandemic
2021 was an extraordinary year for LEGO. Its global sales increased by 43% to hit £2.6bn ($3.5bn) in the first six months of the year while profits rose by a whopping 140% during the same period. The company announced that its sales were up by more than 10% across all markets while online sales rose by 50%. Top performing themes included LEGO Star Wars, LEGO Harry Potter and LEGO City. The company opened more than 60 new branded stores in the first half of 2021, over 40 of which were in China. This brought the total number of LEGO retail stores to 737 as of mid-2021, with 291 of those located in China. This is part of LEGO’s business initiative towards what it calls an ‘omnichannel By Utku Tansel
network’, operating in tandem with LEGO. com. LEGO’s announcement did not come as a surprise to many in the industry as shoppers stayed at home even after lockdown continuing to spend on both for themselves as well as their kids. After the holiday season, the growth should stabilise to more sustainable levels while consumers return to pre-COVID spending habits. In the UK, these news stories had come amidst rising concerns around stock shortages around the Christmas period caused by the ongoing driver shortage as well as higher transport costs. Previously, LEGO had addressed part of the threat by revealing that the company had secured enough shipping containers to keep up with the demand over the holiday season. LEGO continues to build on its success with its ‘Retailtainment’ strategy LEGO’s first ‘Retailtainment’ flagship store in Europe was recently opened in Spain’s Barcelona. The store celebrates the architectural icon Antoni Gaudí offering engaging new play and product experiences with many unique local features, including the 3D LEGO model of the Sagrada Família as well as Park Güell. The move is part of LEGO’s global store expansion strategy which debuted at its New York shop, called ‘Retailtainment
PAGE 30
Center’ in June 2021. The company’s new store format is being hailed as groundbreaking retail innovation offering unique immersive digital and physical shopper experiences. LEGO’s ‘Retailtainment’ store concept roll out worldwide and its enviable financial results confirm that the high street is far from dead and as channels, online and physical are complementary to each other. As I investigated in my “Retail and Ecommerce: Shopping Reinvented” Opinion piece in my Total Licensing column previously, the high street is just evolving as it always has, and inevitably, there are winners and losers. The retailers that have disappeared in recent years are the ones that had already been struggling and the pandemic just accelerated the trend. In city centres, particularly, newer and better retailers are coming in which will undoubtedly help with the footfall into the high street. Going forward, this should accelerate as life gradually goes back to full normality. A shift in shopping habits Consumers are starting to visit brick-andmortar locations again while continuing to embrace the convenience of online shopping. This shift in shopping habits is posing unprecedented challenges to retailers to diversify their in-store shopping experiences from what they offer online, engaging consumers in physical locations with social and playful TOTAL BRAND LICENSING
