Lego Licensing Strategy

One of Lego key to success is probably their licensing strategy. They are currently working with ten different licensers including prestigious ones such as Disney, Lucasfilm and Warner Bros.

This way, they propose a wide range of different products and are able to stick to the new trends. Their sets include Pirates of Caribbean, Prince of Persia, Toy Story, Cars, Harry Potter, Spiderman, Sponge Bob and their greatest success Star Wars (Lego best sale is the rebel Trooper Battle Pack from the Star Wars collection), as well as Winnie the Pooh Duplo sets for younger children.

They also developed their licensing partnerships in the video games sector, which appeared to be very successful : the video game Lego Pirates of Caribbean reached 63 000 sales in only five weeks, and their new release Lego Harry Potter year 5 to 7 (see trailer below) is probably going to be a success too.

Why did Lego choose this policy ? Jill Wilfert, Lego VP Global Partnerships and Alliance Management, explains this strategy : “we want to stay relevant and top-of-mind with children, and we see licensing as a way to reach a new audience of kids while still appealing to our core users -- but we are extremely selective […]. The marriage between the property and Lego has to make sense in the mind of the consumer, and we want to be able to deliver unique products that express the creativity and imagination of our brand". 

Lego favors licenses that are globally relevant and known in the whole world. They also prefer to license mature properties or those with characteristics that present an opportunity to leverage both brands. 

Playmobil on the other hand refuse to use licenses to increase their sales : Bruno Bérard, Director of Playmobil France explains that “Using licenses is contrary to our DNA […]. Children have to imagine their own stories”. 

Whose strategy is the best one, it is not us to judge. The only thing we can say is that Lego's turnover is about 2 billion dollars, as against 474 million for Playmobil, which seems to underline how profitable Lego's licensing strategy is.