LEGO confident in growth in China
The LEGO Group, known for its brick sets, remains optimistic about its long-term growth in the Chinese market, focusing on innovation and local relevance.
CEO Niels B. Christiansen reaffirmed the group's commitment to continued investment in the market during a recent trip to Shanghai.
Over the past decade, the group has achieved significant market share and rapid growth in China, one of its most important international markets. The group has opened more than 500 stores in China.
"We've experienced a fantastic journey of growth here, and we strongly believe in the future of the market. There are still many children and families who haven't had the opportunity to experience LEGO," Christiansen said.
He expressed confidence in the company's ability to return to growth.
"What matters most is our commitment to the Chinese market and our confidence that we will achieve growth again in China," he added.
Although consumers have become more cautious about non-essential purchases, Christiansen remains optimistic. "Consumer might be hesitant to spend now, but I'm certain confidence will return, and we'll be ready to capitalize on that," Christiansen said.
To support future growth, the group plans to continue to expand its operations in China.
A key strategy is the development of culturally relevant products, such as the LEGO Monkie Kid series, inspired by the classic Chinese legend Journey to the West.
"Monkie Kid is unique to the Chinese market and reflects our commitment to ensuring the LEGO brand resonates with local consumers," he said. "We're proud that Monkie Kid has been well-received in China, and we plan to continue developing products that speak to local culture."
The company is gearing up for the new items for the upcoming Chinese New Year, although specific details have not yet been disclosed.
The group is doubling down on expanding its physical and digital presence in China. The company has recently added investment in its factory in Jiaxing, Zhejiang province, with the opening of a new processing line, a molding center and two high-bay warehouses, to bolster its supply chain and support future growth.
Retail remains a crucial pillar.
The company plans to open more stores, upgrade existing ones, and relocate some to better locations to improve customer experiences, said the CEO.
"Stores will continue to play an important role for us, but they'll be complemented by digital and online experiences," Christiansen said.
The company's digital innovation center in Shanghai is not just focused on the Chinese market but is also contributing to the group's global operations, he added.
The opening of LEGOLAND Shanghai next summer is expected to be a key driver of the company's growth in China. The park is set to be one of the largest and most modern LEGOLAND parks globally.
Globally, the LEGO group has outperformed the broader toy industry globally over the past five to six years, growing at an average 13 to 14 percent, compared to the industry's two percent growth. The company introduced more than 300 new products in the first half of this year alone.
One growth driver for the LEGO Group is to combine creative experience with physical products. Key partnerships, such as collaborations with sportswear giant Nike and F1 this year, have helped the company stay relevant and trendy with consumers around the world, said the CEO.
"If you ask me what keeps me awake at night, it's our ability to stay relevant and come out with exciting products all the time," said Christiansen.
