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Lego’s big prospects in China

Danish toymaker Lego Group said it plans to ramp up its China retail rollout, with two new flagship stores poised for Shanghai and Beijing by mid-2019.

SEE ALSO: Lego opens first Beijing store

The Copenhagen-based Lego, which recorded double-digit revenue growth in China in the first half of the year, said a new store is slated for Shanghai as soon as this month, in the city’s downtown district, while the Beijing boutique is planned for early 2019.

For the first six months of the current fiscal year, Lego’s total sales hit 14.3 billion Danish kroner ($2.2 billion), a 5% drop from last year’s performance. Operating profit declined 4% to 4.2 billion Danish kroner, while net profit dropped 10% to 3 billion Danish kroner.

But China, which recorded double-digit growth for the brand, was a bright spot.

Jacob Kragh, senior vice-president at Lego, told China Daily that China has much room to grow, especially through the learning through way toy category, as parents focus on construction-based toys.

In May, Lego inked a video channel deal with Tencent Holding’s to appear on the media giant’s streaming platform.

Moving forward, Lego plans to invest more in innovative products and enhance its digital, alongside its physical presence in China.

Lego first entered mainland China two years ago, with a flagship store opening at Shanghai Disney Resort in 2016.

Most recently, in August, Lego opened four certified Lego stores in Wuhan alone, via retail partnerships in China, taking its total to 36 partnership stores.

By year-end, Lego is planning to have up to 60 stores across 15 Chinese cities, with the new stores mostly located in second and third-tier cities.

SEE ALSO: EXCLUSIVE INTERVIEW with IKEA Southeast Asia

Lego also recently joined forces with IKEA to encourage more play. The collaboration aims to increase the opportunity for more play, and the first step is to try to make the home a better functioning and more fun place as IKEA believes play to be an ‘essential part of a better everyday life’.

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