Marketing

1. For the purposes of assessment, this case study has been adapted from real events within
the organization.
Lego has come a long way over the past 80 years - from a small carpenter’s workshop to a
modern, global enterprise that is now one of the world’s largest manufacturers of toys.
The LEGO brick is our most important product. We are proud to have been named “Toy of
the Century” twice. Our products have undergone extensive development over the years – but
the foundation remains the traditional LEGO brick.
The brick in its present form was launched in 1958. The interlocking principle with its tubes
makes it unique and offers unlimited building possibilities. It's just a matter of getting the
imagination going – and letting a wealth of creative ideas emerge through play.
Sales have been declining across some of Lego’s core markets; in the USA sales dropped by
35% from last year, Germany finished the year approximately 20 percent below prior year’s
level, and the UK, Holland and the Nordic markets fell by 13 percent. Only the new markets
in Eastern Europe and distributor markets maintained sales on a par with prior year. Sales of
movie tie-in products developed unsatisfactorily. Interest in the Star Wars range and, to an
even greater extent, the Harry Potter series fell below expectations without new movie
releases. The drop in sales of these products accounted for more than 50 percent of the
overall sales decrease.
One ex-employee is quoted as saying: “Lego’s off track and management don’t really
understand how far it is off track. Most employees and customers are very clear about the
problems but there are no lines of communication to enable the key messages to get through
to the top.”
The owners of the company (Lego is privately owned) had been spooked by the patent expiry
of the basic LEGO brick. Competitors like Tyco Toys and Mega Bloks had developed ‘me
too’ products. New products including software, games, PlayStation, Xbox and the like had
convinced senior management the move would be digital. “The LEGO brick was going to
die!”. Hence the rush into adjacent markets in the perceived need to diversify away from the
original business.
LEGO had tried to develop a diversification strategy which included software (LEGO
Moviemaker), learning concepts (LEGO education), lifestyle products (LEGO Kid’s wear),
girls toys (LEGO dolls), books, magazines, television, theme parks and own retail with a goal
of over three hundred retail stores.
Each move had demanded a special set of skills away from the basic skill set within the
LEGO business. Knudstrop was to herald a return to basics, reminiscent of the “Stick to the
Knitting” mantra of Peters and Waterman [1982]. The company had been guilty of chasing
too many fads and ignoring the focus on key LEGO kit construction products. There had to
be a return to the LEGO brick. Back to the brick as a building system. A coherent expandable
universe of toys. There had also to be a focus on profitability, especially the basic potential of
the core products.
The LEGO Company have recently shelved certain initiatives outside of the core business,
including wristwatches, publishing and other lifestyle products. At the same time, LEGO
intends to reduce losses in software and the LEGOLAND parks. The strategy is to refocus on

2. the LEGO brand – stimulating imagination, creativity and learning – “it is what children and
parents expect from us. We will continue to expand within this area, applying a growth
strategy with a huge potential and lower risk”
Assignment Tasks. Answer ALL Tasks
Scenario: You are a marketing Consultant for Lego. The senior management team of the
organisation have asked you to conduct detailed research on their current situation and then
prepare a formal report that includes:
a) A SWOT analysis on Lego highlighting the most important/critical Strengths,
Weaknesses, Opportunities and Threats facing Lego at this time (15 Marks)
b) From the SWOT findings recommend and justify 3 SMART marketing objectives (10
marks)
c) Recommend and justify ONE appropriate marketing strategy to help Lego achieve
these objectives (15 marks)
d) Based on the above tasks justify what changes you would make to the current
Marketing mix (7Ps) for Lego. (20 marks)
e) Include an implementation chart (10 marks)
f) Describe what metrics you would use to help you measure the success of the plan (15
marks)
g) Transferable Skills: (15 Marks) including professional format, references and in text
citations, use of the ICP House Format.
Core text
Brassington, F . and Pettitt, S ., 2006, Principles of Marketing, FT/Prentice-Hall.

3. Marking Criteria
Assessment criteria and Distinction Higher Credit Credit Pass Fail
(LO’s) (100-70%) (69-60%) (59-50%) (49-40%) (<40%)
1. External audit Exemplary exploration and Locates & explores a wide Locates & organises an Locates & organises an Relies on inadequate range of
(Cognitive) evaluation of information range of information/ acceptable range of acceptable range of poor quality information
from an extensive range of evidence. information/evidence information/evidence
sources.
2. SWOT analysis Exceptional critical Largely consistent and Applies some aspects of prior Limited application of prior Fails to apply learning to
(Cognitive) judgement in analysis, critical judgement in learning in different contexts learning to new contexts different contexts
evaluation and reformatting analysis, evaluation and
of information and reformatting of
application of prior learning information and application
in different contexts of prior learning in different
contexts
3. Marketing objectives and Exceptional critical Applies some aspects of prior Applies some aspects of prior Limited application of prior Fails to apply learning to
four SMART marketing judgement in analysis, learning in different learning in different contexts learning to new contexts different contexts
objectives evaluation and reformatting Contexts
(Analytical) of information and
application of prior learning
in different contexts
4. Marketing strategies then Exceptional critical Critical judgement in Largely consistent and Applies some aspects of prior Fails to apply learning to
identify which type(s) of judgement in analysis, analysis, evaluation and critical judgement in learning in different contexts different contexts
strategy and why you evaluation and reformatting reformatting of information analysis, and evaluation of
have chosen that strategy. of information and and application of prior information and application
(Analytical) application of prior learning learning in different contexts of prior learning in different
in different contexts contexts
5. Marketing programmes Exceptional critical Largely consistent and Applies some aspects of prior Limited application of prior Fails to apply learning to
(Analytical) judgement in critical judgement in learning in different contexts learning to new contexts different contexts
analysis, evaluation and analysis, evaluation and
reformatting of information reformatting of
and application of prior information and application
learning in different contexts of prior learning in different
contexts
6. Business Report format, Excellent presentation and Presentation and organisation Satisfactory organisation & Organisation and Work is disorganised, poorly
tables/diagrams labelled, organisation of work with of work appropriate to presentation of work, com- presentation of work and presented with poor/
spelling and grammar. lucid communication in all context and purpose, munications mostly communications adequate in inappropriate expression/
Harvard Referencing. contexts; exemplary communication clear; appropriate to the context/ most contexts, with some communication ; substantial
(Transferable skills)) referencing/citation. referencing/citation purpose/referencing/ citation mistakes/irrelevancies errors errors in referencing/
consistent and accurate largely consistent in referencing/ citation citation, or none
[ ] Please tick this box to ensure you have read and understood the above criteria
International College Portsmouth, Associate College of the University of Portsmouth, St Andrew’s Court St Michael’s Road, Portsmouth, Hants, PO1 2PR
T: +44 23 9284 8540 F: +44 23 9284 8541 W: www.port.ac.uk/icp

4. International College Portsmouth, Associate College of the University of Portsmouth, St Andrew’s Court St Michael’s Road, Portsmouth,
Hants, PO1 2PR
T: +44 23 9284 8540 F: +44 23 9284 8541 W: www.port.ac.uk/icp

5. Contents
Executive summary.................................................................................................................................................1
1. SWOT Analysis................................................................................................................................................2
2. SMART marketing objectives......................................................................................................................4
3. Recommendation of marketing strategy....................................................................................................4
4. Recommendation of changes to Marketing Mix 7Ps ..............................................................................5
5. Implementation chart.....................................................................................................................................6
6. Metrics to measure the success of the plan ...............................................................................................7
Reference ...................................................................................................................................................................8
Executive summary
Headquartered in Denmark, Lego is the well-established Danish company specializing in toys
and teaching materials for children since 1930s. The company has offered its flagship products,
1

6. minifigures or bricks, over more than 130 countries all over the world including Europe, the US,
Australia and Asia. Besides, Lego also extend its business portfolio with theme parks, retail
stores, video games, board games, films, books, magazines and children clothing. The
company’s mission is stated that “ our mission is to nurture the child in each of us, and this
means that we actively encourage self-expression through creation, thus enabling children of all
ages to bring endless ideas to life.” (Lego Group, n.d)
This report will first analyze Lego’s strengths and weaknesses as current opportunities and
threats that the company is facing, thereby, propose SMART objectives, marketing strategies and
changes in marketing mix decisions for Lego in next three years to help the company continue its
business growth in such competitive global market
1. SWOT Analysis
The following table presents SWOT analysis for Lego Group:
Strengths
- Strong global brand name of play and
learning materials with high brand
equity
- Huge loyal customer base
- Exclusive licensing arrangements with
well-established highly appealing
global brands such as Star War, Harry
Potter, DC Comics, Lord of the Rings,
Disney and Marvel (Marketline, 2013).
- Strong international market experience
and expertise in toys and teaching
materials for children since 1934
- Wide and solid distribution network
with more than 125 retail stores
throughout the US, Europe and
Australia (MarketLine, 2016)
- Wide product ranges including core
products and new digital experience
ones (i.e. 600 products available in
2016) (Lego Group, 2016)
- Sustainable materials (Lego Group,
2016)
- Partnership with UNICEF for even
stronger brand image (Lego Group,
2016)
- Strong research and development
team(Lego Group, 2016)
Weaknesses
- Brand identity is losing due to the increasing
emergence of me-too products (MarketLine ,
2013).
- High pricing
- Still low present in Asian countries with no
retail stores
- High diversification of markets and products
upon aggressive expansion but lack of focus on
core products with which Lego has well
established competitive advantages (Metcalf &
LaFranco, 2013)
2

7. - Healthy financial status according to
the latest report in 2016 (Lego Group,
2016)
Opportunities Threats
- Stable and strong economic growth in some - Intense competition in global toys and
of core markets (World Bank, 2016) games
- Increasing household disposable income in - Customers’ low switching costs to me-
core markets (OECD, 2016) too products from competitors such as
- The rising of global middle class who may be Fisher Price; Hasbro, Inc.; K'NEX
willing and affordable to spend for children’s Industries, Inc.; Sababa Toys and
entertainment and education, especially in Simba Toys which can offer similar
Asian and South African developing countries products at lower prices (MarketLine,
where Lego has not targeted such as Brazil, 2016)
Malaysia, Vietnam, Indonesia, Thailand, - The expiry of licensing agreements
Philippine, etc. (World Population Review, with film brands may lead to more me-
2017). too products
- New movies and brands available are coming - Increased labor costs due to policies to
for licensing agreements raise average wages in many countries
- Reduce production costs through outsourcing - Increased raw material prices in long
- Reduce transaction costs by producing right run
at the markets where finished products are sold - Decreasing birth rates and old
- Increasing population and high birth rate at population trends in core markets
some of current core markets, especially in especially in the US and European
South African and Asian countries (World countries (World Population Review,
Population Review, 2017). 2017).
- The widespread of Internet enabling digital - Children grow up faster and their play
promotional activities and reaching wide range patterns are changing towards digital
of global customers games due to the increasing adoption of
smartphones, computers and tablets as
well as the wide spread of Internet even
in developing countries (Majken S. &
Mary, J. H, 2003).
- The rapid development and wide
coverage of the Digital World across all
age ranges lead to even more intense
competition with digital games, play
software and electronic toys (Majken
S. & Mary, J. H, 2003).
- A life cycle of a toy product is shorter
since toys become out of fashion more
rapidly (Majken S. & Mary, J. H,
2003).
3

8. According to the above SWOT analysis, although Lego has acquired solid global market position
with many valuable resources which give the companies competitive edges, such competitive
advantages are not really sustainable enough to make sure that Lego can defend its marker
leadership without enhancements in marketing strategies since other competitors can quickly
imitate and offer me-too products with lower prices (Whittington, 2011).
Besides, although Lego has faced many threats in current core markets especially in European
and American markets while there are great opportunities for production and sales in South
African and Asian countries, its presence in these potential markets is still low.
As a result, the main objective of Lego Group in next three years should be expansion to South
African and Asian markets, thereby, increase sales and market share.
2. SMART marketing objectives
Specifically, SMART marketing objectives of Lego can be presented as below:
From March, 2017 to March, 2020, Lego Group will
- Open 5 new factories and 20 new retail stores across 5 new country markets in South
Africa and Asia including Brazil, Malaysia, Vietnam, Indonesia, Thailand, Philippine
- Increase global sales by 40%
- Increase global market share of toy and game market by 5%
3. Recommendation of marketing strategy
Upon a long history since 1930s, Logo has well established as high quality toy brand of high
educational and healthy value that are familiar with parents all over the world. Such strong brand
name and high brand equity form sustainable competitive advantages for Lego that are not easily
to acquire. Besides, Lego has strong international market experience and excellent expertise in
toys and teaching materials for children. Therefore, these current strength should be adopted to
pursue new opportunities in Asian and South African markets.
In this report, Ansoff Matrix will be used to recommend the best marketing strategy for Lego’s
future growth concentrating on products and markets or customers (Kotler & Armstrong, 2011)
4

9. Figure 1: Ansoff matrix (Kotler & Armstrong, 2011)
According to the SWOT analysis and SMART marketing objectives that have been set, so as to
use its strengths to take advantages of opportunities and minimize risks resulted from threats in
current European and American markets while overcome weaknesses to ensure such
opportunities work the best, Lego Group should adopt market development strategy so as to
introduce its core products which includes toys and teaching materials to new markets including
Brazil, Malaysia, Vietnam, Indonesia, Thailand, Philippine. In these markets, target customers of
Lego are children and families of the rising middle and upper class
4. Recommendation of changes to Marketing Mix 7Ps
4.1.Product
Although Lego’s core products including toys (i.e. bricks with theme)and teaching materials will
be launched in the five new country markets, these products will be carefully designed so as to
suit each country’s culture and education levels. Specifically, each country has its own folk
stories that parents often tell their children. These folk stories can be familiar and inspiring
themes for Lego brick collection besides global famous licensed movie themes.
4.2.Price
Optional Product pricing strategy should be adopted in which each Lego collection will include
two parts the main products which are sufficient to play alone and optional accessories including
additional bricks to enrich the collection. This pricing strategy will help reduce the current price
level of Lego while still offer better products at higher prices for customers of the upper class.
4.3.Promotion
Digital marketing should be adopted more aggressively since there are more and more global
customers are available on the Internet. So as to reach customers in new markets, the following
digital advertising channels should be used:
5

10. - Websites in local languages
- Social network fanpages in local languages such as Facebook, Twitter, Istagram
- Youtube channel with videos featuring famous kids in each country are playing Lego as toy
reviews
Personal selling should be used more efficiently so as to sell Lego teaching materials for kinder
gardens, primary schools and elementary schools
4.4.Place
20 new retail stores will be opened in Brazil, Malaysia, Vietnam, Indonesia, Thailand and
Philippine that help increase Lego brand presence and sales opportunities in these new markets.
Websites should also act as online stores where customers can make online purchase easily
4.5.People
Lego should build separate research and development teams in each country and recruit talented
local people to work for R&D departments since they will understand the best their culture and
education characteristics in their own countries
Lego sales staff will be trained to be expert in children education who can give valuable advice
for parents about how can use and select the suitable Lego toys and teaching materials
4.6.Physical evidence
Each retail store should be designed as a playful places which delight and attract children with
colorful themed walls and free trial Lego toys and teaching materials for both children and
parents that will attract customers better while enhance their desire to obtain Lego products
4.7.Process
Customers can either experience Lego shopping through traditional retail stores or online
platform. By either way, they can firstly enjoy some trials or digital demonstration as well as ask
for helpful advices before making purchasing.
5. Implementation chart
Tasks March – September March – September March – September
September 2017- September 2018- September 2019-
2017 March 2018 March 2019 March
2018 2019 2020
Marketing
research
and
6

11. customer
research
Recruit
local
managers,
sales and
and R& D
teams
Product
designs for
new
markets
Test
marketing
in new
markets
Open new
retail stores
in new
markets
Build
websites
for new
markets
Create and
maintain
new social
networks
for new
markets
Make and
share new
videos
6. Metrics to measure the success of the plan
The following table presents key metrics to be used and factors to be measured and monitor so as
to ensure the success of the marketing plan
Factors Metrics
Revenue In USD per 3 months
Costs In USD per 3 months
7

12. Profit In USD per 3 months
Market share % per 3 months
Brand equity, customer satisfaction, Findings from customer research
customers’ attitude
Reference
Brassington, F . and Pettitt, S . (2006). Principles of Marketing. FT/Prentice-Hall.
MarketLine (2016). Company Profile: The Lego Group. [Online]. Available at <
http://advantage.marketline.com.yorksj.idm.oclc.org/Product?ptype=Companies&pid=DA2B9C 81-
51E9-451E-88E2-198AFB4A4D11 >
Kotler, P. & Amstrong, G. (2011). Principles of Marketing, 14th ed. Pearson
Lego Group (n.d). About us. [Online]. Available at < https://www.lego.com/en-us/aboutus >
Lego Group (2016). Annual Reports. [Online]. Available at < https://www.lego.com/en-
us/aboutus/lego-group/annual-report >
MarketLine (2013). The Lego Group: Iconic bricks find the better model. [Online]. Available at
<http://advantage.marketline.com.yorksj.idm.oclc.org/Product?ptype=Case+Studies&pid=ML00
007-077 >
MarketLine (2016). The Lego Group. [Online]. Available at <
http://advantage.marketline.com.yorksj.idm.oclc.org/Product?ptype=Companies&pid=DA2B9C
81-51E9-451E-88E2-198AFB4A4D11 >
Majken S. & Mary, J. H (2003). The Cycles of Corporate Branding: The Case of the LEGO
Company. California Management Review. Vol .16, No.1
Metcalf, T., & LaFranco, R. (2013, March 13). Lego builds new billionaires as toymaker topples
mattel. Bloomberg. [Online]. Available at <http://www.bloomberg.com/news/2013-03-13/lego-
builds-new-billionaires-as-toymaker-topples-mattel.html >
OECD (2016). Household disposable income. [Online]. Available at <
https://data.oecd.org/hha/household-disposable-income.htm >
Whittington, R., Scholes, K., & Johnson, G. (2011).Exploring strategy. (9th ed.). Pearson
Education Limited.
8

13. World Bank (2016). GDP growth. [Online]. Available at <
http://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG >
World Population Review (2017). Population review by country. [Online]. Available at <
http://worldpopulationreview.com/countries/>
Bạn đang phải vừa học vừa làm. Các bài ESSAY, ASSIGNMENT, DISSERTATION,
COURSEWORK... làm cho bạn cảm thấy lo lắng và căng thẳng.
Với 5 năm kinh nghiệm , mình tự tin sẽ giải quyết mọi bài vở theo yêu cầu từ A đến Z
cho các bạn du học sinh. Đừng chần trừ hãy liên hệ ngay với mình.
Mr Đỗ Tấn Hoàng
dotanhoang91@gmail.com
https://www.slideshare.net/HoangDoTan một số bài mình đã làm để các bạn tham khảo
Cảm ơn các bạn đã và đang ủng hộ mình trong 5 năm qua
#assignmenthelp #dissertationhelp
Kết nối với mình tại:
Facebook: https://www.facebook.com/dotanhoang91