Lego SWOT Analysis 2022: A Creative and Detailed

Report!
swothub.com/lego-swot-analysis-2022-a-creative-and-detailed-report

By Ronique Gibson Last Updated: October 26, 2022

Who doesn’t love playing and enjoying the creativity of Lego toys? This Lego SWOT analysis highlights this beloved
toy brand. Similar to Disney, Lego is loved by young children and aged adults.

The Lego Group History

The world’s largest Danish toy manufacturer, Lego, famous for its interlocking brick toys, was formed in 1932. Ole
Kirk Kristiansen, the founder of Lego, began his business in a tiny carpenter shop in Denmark. He started his
company by making simple wooden toys. The Lego Group is a family-owned business that operates in 50 countries.
Lego distributes its toys in more than 130 countries, and 300 million children have used the company’s toys. Lego’s
business model is built on concentrating on children’s toy needs and preferences.

1/7
Watch Video At: https://youtu.be/qr_dTySMl7s

Lego – At A Glance

Company Name Lego (The Lego Group)

Industry Toys

Founded August 10, 1932

Founder Ole Kirk Christiansen

CEO Arvind Krishn

Headquarter Billund, Denmark

Annual Revenue $43.7 Billion (FY 2021)

Website https://www.lego.com/

According to Lego’s business plan, its main objective is to stimulate children’s imagination and creativity while
allowing them to explore their own creatively fun World.  Lego provides a wide range of colorful and attractive
theme toys. The company operates two theme parks – Legoland and the third is under construction. Because of
Lego’s outstanding business strategies and planning, the company stands in a leadership position in the toy industry.
Here we are going to do a SWOT analysis of a toy company, Lego.  This analysis will help to study the company’s
strengths, weaknesses, opportunities, and threats in depth.

Lego SWOT Analysis 2022

2/7
A company’s strengths, weaknesses, opportunities, and dangers are undeniably important considerations. As a
result, a SWOT analysis is performed to fully comprehend these factors and make sound decisions. SWOT analysis
can be extremely beneficial to a company’s performance. The same is true for Lego. If management is interested in
making a choice, a SWOT analysis is required. Today’s topic is the Lego SWOT analysis.

Lego SWOT Overview Template

3/7
Strengths of Lego in SWOT Analysis
Strengths are those characteristics, qualities, and features of a company that has a beneficial impact on the company.
The strengths comprise the worker’s aptitude, creativity, brand image, customer base, and many other crucial
elements. Lego has several advantages as one of the biggest toy manufacturers in the world. We will talk about a

4/7
handful of these in today’s Lego SWOT analysis. Here is where Lego competitive advantage

Worldwide Presence: Children are instantly attracted to Lego’s huge variety of toys, and its global presence in
more than 130 countries with 570 branded stores worldwide makes the company famous among its rivals. Lego toys
are famous among children globally.

Branding: A strong brand portfolio plays a critical role in a company’s success. Lego put a lot of effort into
branding its portfolio, as Lego’s main goal is to expand its product range. Lego’s strong brand portfolio played an
important role in the company’s extraordinary sound performance.

Expert Team Management: Lego’s successful learning and training programs for its employees helped the
company in accomplishing the company’s strategic goals. Lego is famous for its highly competent and skilled
workforce and management. The company’s expert management helped Lego to gain a competitive edge over its
competitors.

Market Strategies: Lego is highly successful in entering new markets and earning success in them. The company’s
“Go to Market Strategies” is a bonus to its thriving performance. Lego’s marketing strategies are considered to be the
mark in the global toy market.

Safe Toys: As a toy manufacturer, Lego is known for its emphasis on kids’ safety while playing with the company’s
toys. Lego is very concerned about its cute targeted audience (kids) safety who use these toys. The company
manufactures toys by focusing the parental concerns about the kid’s toys.

Weaknesses of Lego in SWOT Analysis

No company is perfect in every sector. There always occur such areas where a company deals with problems and
needs to make improvements, these are considered weak areas of the company. Similar to strengths, weaknesses are
inherent characteristics of a company that must be handled inside. The weaknesses of Lego are discussed in more
detail in the next section of the Lego SWOT analysis.

Pricing: Lego’s pricing is expensive compared to its rivals. Lego toys manufacturing cost is much higher than the
other toy companies because of the expensive licensing cost. However, Lego passes its licensing cost to its buyers
which is not a decent move.

Financial Planning: Lego’s current financial planning is not very productive and satisfactory. The liquid and
current asset ratios indicate that the company is not appropriately using cash. Not enough good financial planning
leads to future financial instability.

Online Gaming Trend: As we know, trends are changing immensely from traditional to modern or online
platforms. Kids are switching towards online gaming which creates intense competition between companies and a
loss of market share in the toys market as Lego’s large market share is based on the toys market.

IPR Protection: Lego is failed to stop its competitors from copying products, however, the toys made by other
companies are low in quality as compared to Lego. But Lego’s irresponsible gesture of not putting the focus on IPR
protection is considered one of its biggest weaknesses.

5/7
Opportunities for Lego Strategy Analysis
Just like internal elements impact a company’s success, the external environment has impacts too. The possibilities
from the external environment that can positively impact the company are known as opportunities. When speaking
of opportunities, Lego does have a lot of them. Today, in the Lego SWOT Analysis, we are going to discuss a few,
given below.

Virtual Reality: The future of the world is based on virtual reality technology. Lego has a wide range of toys but
with changing world trends towards new technology, the company launched a few augmented reality games. These
games involve an online view of toys through Lego’s augmented reality application.

Diversified Segments: Lego is trying its best to diversify into additional toys and games segments so that
company can continue to grow in all product segments in the market. However, in recent years company invested a
lot in online platforms. So diversifying segments can help the company to drive its sales sky-high.

Learning and Education: Lego’s school competition initiative is considered one of the finest opportunities to
develop a sense of strong affinity towards productive and fun games, known as the Lego foundation and Lego
education programs. Lego is emphasizing learning in the kids through playing. Lego’s initiatives help the company to
be in line with its vision to inspire and develop builders of tomorrow.

Economic Uptick: As the world is progressing, consumer spending is also increasing side by side. The higher
consumer spending and economic uptick increases in the world allowed Lego to grab and attract new customers that
in turn helps the company to increase its market share.

6/7
Threats for Lego in SWOT Analysis 2022
External impacts are not always pleasant and good, some of these factors can be quite difficult to handle. A threat is
something external to a firm that hurts that company. Threats are an aspect of a business’s microenvironment.
Threats exist for all businesses, including Lego. We shall examine some in the below section of the Lego SWOT
Analysis.

Competition: Competition is rising day by day in every sector of the market due to advanced technology adoption
and modern innovations trends in the world. With the rapid progress in technology, customers’ need to adopt
innovative technology in their everyday life is incredible. The top competitors of Lego in the market are highly
adaptive to innovative technology which is a great threat to the Lego Company’s sales.

COVID-19: The COVID-19 outbreak was still one of the major threats to the business sector. Lego sales were
massively effective due to the pandemic and lockdown. The company lost millions of dollars during the lockdown.
The Covid – 19 restrictions cause hundreds of retail branded stores of Lego to have low foot traffic.

Preferences: The preferences of children and parents are increasingly switching towards online learning tools as
compared to physical toys. The adoption of online games by builders rather than physical toys is also a major threat
to Lego’s future sales and success.

Fluctuating Currencies: The issue of fluctuating currencies is faced by the world’s business sector nowadays,
which is no doubt a threat to the business of all brands of the world. Fluctuations in currencies are majorly due to
political instability in many countries and as we know Lego is operating globally that’s why the threat of fluctuating
currencies is mainly faced by the company.

Copying: The rivals of Lego are immensely copying the toys and games designs of the company and the company is
facing difficulties in resolving the issue that is also a threat to the future company’s sales.

Conclusion and Recommendations for Lego

Lego, one of the top toy producers, should make sure that intellectual property rights are protected. One of the main
issues that need to be resolved right now is the production of knockoff items. One distinguishing feature is the Lego
license agreements. However, it raises the price of manufacturing games and toys. To make its pricing competitive
and reasonable, Lego must look into other creative and less expensive licensing options. Lego’s attention to
children’s toys and activities and worries about safety should be commended

Subscribe for the latest SWOT Analyses

* indicates required

7/7