Thursday, August 29, 2019

Affecting Consumer Behavior Toward China Children Toys

Lego is one of the most reputed organizations known for having amused and nurtured the building as well as the motor skills of children all over the world. Lego’s reputation lies especially in the fact that it appeals to the children, and parents alike. While the children are attracted by the fact that the toys produced by Lego let them build their own creations, the parents are simply attracted by the educational purpose these toys serve (Moreau & Engeset, 2016) .However, the growth of the organization has never been free from challenges, and in order to sustain itself in future, Lego must be able to evaluate the variety of strategic choices available to the company. Before developing the effective strategies necessary for Lego, a SWOT analysis will help in understanding the situation in a better way: It is not just a toy factory, but it serves to educate the children as well. Its educative value has a great appeal to the consumers. It has earned huge brand recognition across fifty five countries. The market is diversified, as it consists of video games, movies and merchandise. Good advertisement and promotional strategies. Huge competition from rival organizatons. The growing popularity of online games among the children. Further product diversification for different age groups is beneficial. Lego can extend its production to other parts of the world, which are experienced in the manufacture of toys. There is a huge lack of innovation. The organization can face huge competition from other low-cost toy products, as well as the new electronic products (Biancamaria et al., 2014). Although Lego has gained unprecedented popularity among the children, the organization has recently failed to retain its high position in the consumer market, and this would not have happened if the organization could keep on innovating itself with time. Definitely, the Lego brand has been introducing a variety of products, such as video games, jewelry sets as well as amusement parks, however, what went wrong was that it failed to keep its focus on the products, and needless to say it was taking haphazard business decisions.   The discipline in the management system was totally missing. There are organizations such as Mega Blocs, which though are imitating the products of Lego, are offering the products at too cheap a price. Hence, these organizations, which are imitating the products of Lego, are using cheaper materials and yet attracting consumers (Koh et al., 2012). Besides, with the emergence of video games and the variety of free online games, children are losing interest in t he toys offered by Lego. Another emerging issue with Lego has been the organization’s focus on a narrow target audience, as a result of which it is unable to gain the attention of a huge number of consumers. The organization has also been encountering a stiff competition from China, as the nation is much popular for its toy markets, which are also operating globally, and apart from the theme-based toys or traditional toys, educational toys are also popularly found in the market (Hawking, 2013).    Robertson claimed that an organization, before introducing innovation must possess sufficient knowledge about what would be the direction of the innovation. Controlled innovation is highly important for an organization, and here in case of Lego, it can be seen that though it tried to introduce disruptive ideas in business, it failed to overlook the commercial gains for the sake of too much focus on creative ideas (Drucker, 2014).   While the Lego group thought that it was enhancing its revenue through market diversification, the over diversification of the products made their business highly irrelevant and directionless (Power et al., 2016). Certain toy-manufacturing organizations are using the competitive pricing policy for selling their products, and hence the parents irrespective of the brand recognition, are getting attracted to their products, since they are reluctant to invest too much for a toy. The main target customers of Lego has been the children aged between 3 to 12 yea rs, and though the organization has gradually diversified its products for manufacturing toys for toddlers and teens, it did not manufacture anything attractive that could gain the attention of the adults (McGraw et al., 2013). To make the business more sustainable in future, Lego must adopt innovative business ideas that will help in pushing the business forward. The organization must focus on a few products, very much relevant and meaningful in the toy- manufacturing business, instead of the theme parks and the apparels. The organization needs to shut down its theme parks, as it is very much capital intensive, and is hardly offering any lucrative returns to the owners. The organization has been tapping a huge number of franchises; however, before doing the same, the organization must have a strategic and well-integrated approach. Lego is losing market to the virtual games and other rival organizations and hence it is important to stick to the Lego movie concept. Further, the organization must adopt very effective promotional strategies, and the organization must keep on interacting with the consumers via social media platforms. Knowing the target market, broadening the market, and instead of diversifying too much, producing limited products for a wide range of consumers, is always a highly beneficial idea. The organization must come up with compelling online game ideas that can attract the consumers irrespective of age and sex. In addition, it should also introduce a few interesting, participatory games in the â€Å"family fun† category. The organization instead of setting up stores in China, should tie up with a popular Chinese toy-manufacturing organization. In order to bring consumer interest in the toys produced by Lego, it can not only take use of social media marketing strategy, but also can arrange competitions in schools, launching new or re-introducing existent products (Anh, 2014). As and when the organization will stop its aggressive expansion, it will be able to focus much better on limited products, both in terms of production as well as promotion. Online gaming is achieving enormous popularity among the children of the present generation, and hence creating great graphics introducing fun and interesting games via online sites, can help in boosting the recognition of Lego. Strategic alliance with the famous Chinese companies can considerably help Lego in achieving greater recognition in the Chinese market, while also helping it acquire greater expertise necessary for serving the changing needs of the consumers. Anh, V. N. (2014).  Analysis factors affecting consumer behavior toward China children toys in Ho Chi Minh City  (Doctoral dissertation, International University HCMC, Vietnam). Biancamaria, S., Lamy, A. and Mognard, N. (2014), May. Analysis of SWOT spatial and temporal samplings over continents. In  EGU General Assembly Conference Abstracts  (Vol. 16, p. 16904). Drucker, P. (2014).  Innovation and entrepreneurship. Routledge. Hawking, S. (2013). Rebuild your childhood with ourLego brick competition.New Scientist,  220(2948), 85. Koh, K.K., Choo, K.W.J. and Chong, K.C. (2012). Lego Challenge for competition project. McGraw, J. J., Wallot, S., Mitkidis, P., & Roepstorff, A. (2014). Culture’s building blocks: investigating cultural evolution in a LEGO construction task.Frontiers in psychology,  5. Moreau, C. P., & Engeset, M. G. (2016). The Downstream Consequences of Problem-Solving Mindsets: How Playing with LEGO Influences Creativity.Journal of Marketing Research,  53(1), 18-30. Powers, C., Spear, R., Wood, D., & Harish, A. (2016). The Re-designed Lego. Getting academic assistance from

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.