Retail

LEGO Plans To Bring 35 Additional Stores To China

Even with a shift toward eCommerce sales, LEGO plans to bring 35 additional stores to China by the close of 2019. The move would take the total to over 140 in that country and almost 600 around the world, Reuters reported.

“You cannot say the physical experience is not necessary, just because more is bought online,” said Chief Executive Niels Christiansen, highlighting the importance of “try-vertising,” in which children try new products in shops.

Christiansen also noted that he hopes LEGO’s move into India would mirror its success in India, where it sells through third-party shops. However, the company has not yet determined whether to bring its own stores there.

“I wonder if we might have LEGO-branded stores in India one day too. I think so,” Christiansen said.

LEGO came back to sales growth in 2018 following a decade of double-digit increases that stopped suddenly in 2017. The company said that sales increased 4 percent to $2.2 billion between January and June. Sales increased 2 percent in local currencies.

The company grew share in its biggest markets, with single-digit growth in western Europe and the United States and double-digit growth in China. Operating profit, however, fell 16 percent to 3.5 billion crowns because of new investments, per the report.

The Chinese toy market stood at $31 billion as of January. Representing under 10 percent of LEGO’s sales, it is seen as a growth avenue that is important for the firm. The expansion for LEGO in China, however, reportedly comes as the country is facing the worst slowdown in economic growth in 28 years.

China is also embroiled in a trade war with the United States that is shaking consumer confidence. Beyond the Chinese economy, the toy company does reportedly have to deal with copycat products and counterfeits that hurt sales.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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