LEGo: Successfully Reviving the Positioning Strategy and Value Proposition off rapidly the following year.

In the absence of those blockbusters, LEGO discovered how unpopular, unprofitable, and “non-core-
like” in terms of brand identity its other toys were. The future looked far from splendid when the
company brought in former McKinsey management consultant Jørgen Vig Knudstorp to run the
company as chief executive. In order to get back on track again, Knudstorp started to redefine the
company’s positioning strategy in 2004 by focusing its approach and returning to the core of its business
—the plastic bricks. More importantly, the company started to reconnect with its customers and listen
to them again. Instead of selling the same standardized products to their customers like in the past, The
LEGO Group changed their positioning strategy and value proposition by enhancing customer
relationships and involving them in order to better tailor products to their specific needs. LEGO started
testing new product ideas during the product development process by using focus groups for children
and adult fans of LEGO (AFOLs). A recent example includes Cuusoo, just one of the company’s many
successes in crowdsourcing ideas after the year of turnaround. Launched in Japan in 2008 and globally in
April 2011, Cuusoo has invited users to submit and vote for ideas for new LEGO sets. If a design wins
more than 10,000 votes, LEGO reviews it for possible production; if the design is developed and
launched, its creators get a 1 percent cut of the product’s total net sales. In 2011, a Cuusoo concept for
a LEGO set based on online game Minecraft racked up 10,000 votes in just 48 hours, compelling LEGO to
announce production of the set. Only six months later, LEGO Minecraft Micro World hit the market. The
unifying purpose behind all subsequent moves has been to focus and structure innovation and customer
orientation as key elements of the value proposition, taking ideas that were “obviously LEGO” and
making them profitable within a short time. LEGO also returned to Christiansen’s idea of a “system of
play” when it cut the number of pieces it made in half, keeping only those “universal” pieces that were
used in many different sets, thereby leveraging economies of scale and condensing the over-diversified
product portfolio. The majority of its revenue still comes from refining classic LEGO lines such as LEGO
City and LEGO Star Wars, licensing more recent mega-hits such as Lord of the Rings, and launching
innovations such as LEGO Friends for the girls’ toy market in 2012. LEGO continues to experiment with
new offerings. For example, through its partnership with Chicago architect Adam Reed Tucker, it
developed its Architecture line, which encompasses reproductions of iconic buildings rendered in LEGO.
Additionally, the iPhone game Life of George, which was launched in 2011, is a mash-up of digital and
physical LEGO play. Few companies have made a successful return to their roots and many who do fail
because they cannot keep up with an everchanging marketing environment. Take Mattel, for example,
which was once the king of the toy aisle, but in 2015 dethroned CEO Bryan Stockton just a few months
after it was reported that the maker of Barbie dolls and Hot Wheels cars is no longer the world’s leading
toy maker. Mattel has struggled lately as its iconic Barbie doll has fallen out of favor with young girls,
who prefer electronics today and dolls based on Disney’s hit animated movie The LEGO Group is a
familyowned company based in Billund, Denmark, and best known for its superior-quality LEGO toys.
The company was founded in 1932 by Ole Kirk Christiansen. The word Lego is derived from the Danish
words “leg godt,” meaning “play well.” On average, every person on earth owns 86 LEGO bricks and a
mind-blowing number of 400 billion LEGO bricks now populate the planet, enough to build a tower to
the moon 10 times over. The LEGO Group patented the