Image source @ Visual China
Text | ECO New Trend, author | No, edit | Too white
According to a survey by HSE University, Russia's State Research University, one commodity yield has outperformed gold and bonds in recent years.
Its name is Lego.
In particular, discontinued and limited legos continue to increase in price at a rate of 10% per year. If you had bought a "one-hand" Lego a few years ago, you would have outperformed those pheasant stock gods.
If it is used as an investment product, Lego can be described as yyds. You know, Lego is an all-age toy, and the price itself is very expensive. The brand side also developed a set of educational concepts centered on Lego, and the tuition fees are often tens of thousands of dollars a year. And Lego Education can join, and the franchise fee is also not cheap.
Looking at this circle, I have to admire Lego. When I was a child, I could play With Lego, and when I grew up, I could take Lego education classes, and when I went to society, I could also trade Lego to make money. Lego gives you most of your life, and the arrangement is clear. In some content communities, many players admit that they have changed from Lego fans to Lego dealers.
Today we will talk about the story behind the lego wealth myth.
01 Lego Snowball: Little bricks make a business empire
LEGO was founded in 1932 and is headquartered in Denmark.
Just like Coca-Cola, it defines the drink "Coke". The word Lego also defines a kind of building block.
Lego bricks are called "patchwork plastic blocks", this kind of building block has convex particles on one side, grooves on the other side, two blocks can be easily put together, and after being put together, they are very strong and not easy to fall off. As a result, endless shapes can be created. There are currently more than 1300 kinds of shapes, each of which has 12 different colors, so it is also known as magic plastic building blocks.
Lego bricks look simple, but they embody the ingenuity of the designers: the top of the brick has protrusions and small holes to ensure that the pieced parts can be tightly connected based on friction. The forerunner of Lego is that it never sells disposable toy products, but a comprehensive system of interconnection between different toys, that is, "Lego System", all Lego products are compatible, different shapes, different sets, different generations of products can be combined together, which not only allows players to fully release their imagination, but also allows lego bricks to continue to expand the consumption empire.
In 2018, LEGO advanced to the top 500 world brands with small bricks. In the first half of 2021, LEGO's revenue increased by 43% year-on-year to DKK 23 billion (approximately US$3.6 billion) and net profit increased by 140% year-on-year to DKK 6.3 billion (approximately US$1 billion), both of which set a record record.
Lego's development has not been smooth sailing. In the early nineties, with the explosion of video games, Lego faced a huge crisis.
Children's attention is taken away by electronic toys, and Lego's market environment begins to be unoptimistic. In 1998, the company even suffered its first loss. In order to seek a breakthrough, Lego began to try content and IP exploration after two years. In addition to improving the building block assembly experience, new popular elements and story lines have been added, IP licensing products have been created, and the transformation from manufacturing to cultural and creative industries has been completed.
Harry Potter, Star Wars, The City series and NINJAGO® became LEGO's highest-selling products at the time. With the help of these super IP stories, LEGO also segmented consumers.
At present, lego's brand map has as many as nearly 25 product lines corresponding to different ages and groups. Lego products in different categories, such as boys, girls, mechanics, buildings, robots, etc., bring LEGO loyal fans in various fields. In order to better understand consumers, LEGO has set up laboratories around the world to capture local market trends and cultural elements, and incubate new creative products, such as launching various festive patchwork products specifically for the Chinese New Year.
Not only that, Lego will also work with consumers to create a co-creation to fully stimulate the creativity of fans. Lego has created an online community called Lego Ideas for its own fans, where users can upload their own creative product proposals and seek likes from other users.
When the number of likes reaches a certain standard, Lego's product team will step in, and it is possible to actually produce the idea, and the user of the proposal can not only leave a name, but also receive a 1% sales dividend. For example, the playset of the American drama "Friends" and the Saturn 5 rocket suit from NASA are all created by fans.
These works, which embody the enthusiasm, creativity and imagination of fans, were well received by the market as soon as they were launched, and even 90% of the products were sold out during the first period. This "consumer co-creation" approach has also greatly increased the participation and loyalty of fans, and has become an important part of Lego brand building. Today, LEGO is no longer a children's toy, and it is also rapidly becoming a fan in the adult world, with millions of fans showing off their LEGO works online every year.
In lego circles, building a car model and a spaceship model with Lego bricks is no longer a big deal, and the Golden Gate Bridge composed of 64,500 Lego pieces and the ancient Roman theater composed of 22,500 Lego pieces are not uncommon... James May, a well-known program narrator of BBC Radio, once built a 1:1 scale, two-story house with about 6 meters high with 3.3 million LEGO bricks, all furniture is the same as the real size, and the bathroom and bathroom can be used directly. In the eyes of fans, everything is Lego.
02 "Death is expensive", the rise of Chinese building blocks
With the transformation of parents' cognition of games, the function of building blocks in educating and developing creativity and promoting brain development has gradually been recognized. Lego, which saw the prospects, introduced the education business and made Lego a course. However, whether as a course or a toy, Lego is too expensive. This price positioning has dissuaded many consumers at the beginning.
Lego seems to be dissatisfied, and once put an advertising slogan: "There is only one kind of building block, which can be called Lego brick." ”
Maybe consumers don't care whether they are called Lego bricks or not, people only care about which building blocks are the building blocks they can afford to play. According to research firm Research And Markets, the global building block toy market is estimated at $7.3 billion in 2020 and is expected to reach $10.4 billion by 2027.
The growing building block market and the brand gap of low-end building blocks have given China's manufacturing development window.
In 2003, the domestic toy brand Guangdong Bangbao Educational Toys was officially established. Two years later, it was successfully listed, and the revenue in the year of listing reached 309 million yuan.
In May 2021, Bruker Group, founded in 2014, officially announced the completion of a Series B financing of RMB 600 million. TOP TOY, which is positioned as a global tide play collection store, also takes the promotion of Chinese brick culture as its corporate goal. In addition, there are Senbao, Xiaoluban, Jixin, Jigao, Enlightenment, Woma and other brands, all of which are deeply cultivating this track, and Mingchuang Premium and Xiaomi have launched dozens of dollars of LEGO parity bricks.
Domestic building blocks have a similar shape to Lego, and can also be assembled and spliced at will, but the price is much cheaper. Once, domestic building blocks did give consumers a sense of cheapness in flat substitutes, OEM and cottages, and now, the above-mentioned domestic building blocks brands are on the road to boutique, not only in the pursuit of excellence in research and development, manufacturing, but also in China's traditional cultural IP authorization. Chinese understands Chinese better, and domestic building blocks have inherent advantages in this regard, so it is no wonder that they can quickly capture the hearts of Chinese consumers.
The "Wandering Earth" movie fire has made the brick brand of Senbao appear in front of consumers. Senbao bricks signed the copyright around the blocks of "The Wandering Earth", and the armored vehicles and personnel carriers that appeared in the movie were extremely restored, making science fiction fans have a good addiction.
Enlightenment Building Blocks launched the "Nezha Magic Boy Descending" series: Jiang Ziya, Nezha, Ao Bing and other animated characters came alive. There are also some building brands that focus on Chinese national style buildings and scenes, such as the Dart Bureau, the Academy, the Forbidden City, and the Taihe Hall, while Chinese IP such as Journey to the West, White Snake, and Peking Opera Face are also very popular with Chinese consumers.
03 The rise of new domestic products breaks the Chain of Lego contempt
On social platforms, the issue of Lego's high pricing has been debated endlessly.
One view is that Lego parts are of high quality, have a good educational concept, and have a lot of IP and brand added value. Coupled with the expectation of appreciation, it is absolutely "no loss in shares". Not only that, but there is also a view that domestic building blocks are equal to copycat goods, which is not inferior to Lego at all.
This kind of stigmatization is unfair to Chinese bricks. Today's Chinese head building blocks, whether from the concept, to the factory equipment, product research and development, IP licensing applications, etc. can face international brands head-on. Compared with Lego, the cost control of domestic building blocks is also more dominant, and even some building block general parts research and development companies have begun to layout. Once the scale effect is accumulated, the profit of domestic building blocks will go up the ladder, lego can do, domestic building blocks can also do, or even do better.
Take a recent example, lego's Christmas set giveaway was later cancelled because it did not meet the quality standards of the LEGO Group, but the 40489 that had flowed to the market was still speculated to a sky-high price.
It can be seen that many people's pursuit of Lego is already inconsistent. Forcibly holding Lego is aimed at turning the gloves around. As for those educational courses, they should appear in the form of universal benefits and benefit more users.
It is true that there is still a gap between domestic building blocks and Lego in some details, such as the splicing effort and hand pain that many consumers react to, and the building blocks are easy to scatter after being spelled. In this regard, aspiring enterprises have improved by updating equipment and iterating on technology. Actively embracing many popular trends such as national tide, military, science and education, film and television IP, etc., also makes the theme of domestic building blocks more rich and diverse.
The past life of Chinese building blocks can be traced back to the ancestor Lu Ban, with two pieces of wood, made into a convex and a concave combination, do not need a nail and a rive, this is the mortise, as the Chinese inheritance of generations of construction skills have continued for thousands of years. Nowadays, it has come to the "year of fighting" of Chinese building blocks, and the Chinese brick market with a hundred schools of thought and flowers has further taken shape. The day when Chinese building blocks with both traditional cultural connotations and the concept of tide play art will crush Lego may not be far away.
I believe that it will not be long before the chain of prejudiced building blocks of contempt will be completely broken!