LEGO grows faster by reaching customers faster

LEGO grows faster by reaching customers faster

One of the major challenges facing global brands today is ensuring their marketing reflects the real interests and behaviour of consumers, whilst getting into the market much faster. Previously, companies and agencies could spend months developing marketing strategies before product launch. This is not possible today if you want to beat your competitors.

What media habits do your customers have today? In six months? A year?

The media landscape is constantly changing, and corporate marketing must reflect the habits and interests of consumers if competitiveness is to be assured.

This puts pressure on both product development and marketing strategies. Because if a company is to create value and be present where its consumers are, go-to-market strategies need to be better and set up faster.

This is one of the conclusions of a recent survey by Worldwide Partners and The CMO Council among 350 CMOs worldwide. The study shows that time-to-market has become a decisive factor for modern-day CMOs, especially in a changing media landscape.

40% of respondents claimed their main focus in the coming year will be to improve the process of developing their go-to-market strategies.

The potential benefits of this are clear to see.

 

Slowing down to focus up

For LEGO in 2017, a slowing of their astonishing growth over the previous 12 years provided an opportunity to take a closer look at their go-to-market strategies. By investigating what dynamics had changed in the market, they hoped to ensure further growth and enhance their competitiveness.

“Continuously adjust the collaborative relationship between your in-house resource and external agencies, so that both parties are able to constantly challenge each other. For a long time in marketing, we were in a situation where we had to cut down on our demand-driven activities because we simply couldn't keep up,” said Lena Dixen, LEGO's Senior Vice President.

LEGO realised that the entire global retail market around them had changed with the rise of e-commerce. Crucially, the media habits of children had also been completely revolutionised, and as a result they were growing hungry for news and products on platforms such as YouTube.

In addition, the rapidly changing consumer media habits have meant that “consumers have become less loyal to products and brands”, according to our CEO here at Advance, Claus Wittenborg. This coincided with increased competition, as “new players enter the market with new solutions or offer solutions faster and cheaper.”

Fierce competition naturally means getting products to market as quickly as possible was imperative for companies such as LEGO.

LEGO needed to keep in sync with their consumers.

Real-time response

That’s why today, LEGO has prioritised being able to respond quickly to current issues and trends in the market, to be present with relevant content on the platforms that consumers are currently using, and to communicate more in real-time – rather than just tying marketing up in more traditional product launches.

“On the product side, we have shortened our development time for just under half of our products,” Lena reveals. “In terms of marketing, we work much closer to launch today, and marketing is an integral part of product development.”

With this revaluation of marketing strategy and responsiveness, came a resurgence in consumer confidence.

LEGO used to spend about 90% of their marketing budget associated with this year's product launches, the year prior. Today, it’s closer to 50/50.

And it has led to a growth in consumer sales of 3% in 2018 and 4% in the first half of 2019.

The time for time is over

When products need to be faster in the market, marketing also has to go faster. For Claus, “it is no use for the agency to receive a brief and then work for several weeks on the concept that the whole campaign should be built on.”

“That time is over.”

Of course, the demand to produce more products, at speed, creates an added threat to a company’s long-term business strategy, unless product development and marketing go hand-in-hand.

In order for this to happen, companies and agencies must collaborate in entirely new ways.

A huge paradigm shift

At LEGO, the increased focus on consumer insight and media habits has meant that marketing has become an integral part of product development—something which Lena Dixen describes as “a huge paradigm shift.”

“We have our advertising and media partners on board in product development because we have to keep our fingers on the pulse of where the kids are, what platforms they are on, what's happening in markets and how our competitors are acting.”

To keep as agile as possible, it therefore makes sense to think about marketing early in the process.

When this happens, we tend to create the best solutions and achieve the strongest results. Including throughout Advance’s 45 years of partnership with LEGO.

In 2019, to coincide with the launch of the third season of Stranger Things, we worked with LEGO’s in-house advertising agency to develop and execute a targeted campaign for adults on social media, featuring LEGO's Stranger Things products, including a 1980s-style commercial – famously the same decade in which the TV series is set.

“It was a piece of brilliant marketing work”, states Lena, “and it has given us fantastic publicity and a product that really sells well. It's an example of us working closely and quickly when the opportunity arises – instead of following a campaign plan laid out the year before.”