Live from NEMOA: Lego Builds Brand Brick by Brick

Mar 31, 2005 4:49 AM  By

Cambridge, MA—Staying true to its mission of providing creative, confidence-building toys for children while continuing to expand its number of customer touch points has been integral to the success of Enfield, CT-based Lego, Steve Hawco, vice president, direct marketing and e-commerce, told attendees at the New England Mail Order Association’s spring conference last week.

The company uses its multichannel approach to get to know its customers better, said Hawco. “Children are our role models,” he said. The Lego Website has recorded 4.3 million unique visitors a month, while its 25 stores boast of 100 million visitors a year. In addition to its Shop at Home catalog, the company stays in touch with customers through Lego Club, a loyalty/promotional club that is self-selected online or through the catalog by the child. A key benefit of the club is the bimonthly “Lego” magazine, said Hawco. The company has received photos of children’s bedrooms with old copies of the magazine and catalog serving as wallpaper. Ninety-two percent of club magazine recipients say that they talk about the content with friends, sharing the publication with an additional 3.5 contacts. “What great word-of-mouth endorsements,” Hawco enthused.

There is a difference between club members and nonmembers in the level of involvement with the product, with 56% of those registered with the club reporting that they play with Legos every day. Club members are also three times more likely to buy the company’s product than U.S. boys in general. More than half of its customers are male, with those ages 5-14 making up the company’s marketing “sweet spot.” “We’re trying to make Lego part of their daily life,” Hawco said.

To further involve customers, anyone can post pictures of Lego creations on the company’s Shop at Home Website “for a sense of pride and achievement,” said Hawco, who explained that the site had become a key point of contact for the company, with 90% of its customers reporting that they have online access. The Lego Factory, a sitelet that users can get to from the home page, hosts Lego building contests, in which the winning entry gets a building set modeled after it. The creations are made electronically through a proprietary Lego design program that can be downloaded onto the customer’s computer.

Offering customers the choice of channels is also essential, said Hawco, as only 27% are known to shop solely from the Website and/or catalog; 73% shop from all of its sales channels. The company sells wholesale to retailers such as Toys ‘R’ Us, but it isn’t concerned about cannibalizing sales among its other outlets. While Toys ‘R’ Us offers 100-200 Lego products, more than 700 pieces of Lego merchandise are available on the Shop at Home Website. Forty-six percent of buyers say they prefer to make purchases on the site due to the added convenience. “If they can’t find it in retail, that’s when they come to us, and that’s when we drive loyalty,” Hawco said.

The company is aware of the need to maintain a consistent brand creative across sales channels, “translating retail packaging into a catalog spread.” It also knows when less branding is more. Hawco said that the company now delivers products to customers in unmarked, plain brown boxes, after years of receiving complaints from mothers that Christmas was ruined because the child in the house saw the box with the Lego logo on its side waiting at the door.