LEGO expanding experience-centered stores in nation

Amid surging enthusiasm for out-of-home novel and leisure activities, LEGO, a global leader in toy manufacturing, is strategically expanding its presence by introducing more experience-centered stores in China to captivate more new consumers and forge deeper connections.

On Saturday, the Danish firm unveiled in Joy City shopping center in Xidan, Beijing, its third beacon store in the country, following earlier openings in Changsha, Hunan province and Xi'an, Shaanxi province, last year.

The store is designed to offer an immersive and culturally resonant playspace and amusement destination to build connections with visitors from the minute they step into the elevator. The lift and surrounding product display spaces in the store are adorned with ancient palace-themed decor, creating an inviting vibe for the immersive world of play.

The new store's decor and vibe are fashioned after the corners of ancient palaces and modern urban street views in the Chinese capital. Moreover, 3D brick figures are built depicting iconic cultural scenes inseparable from Beijing. For example, in one LEGO structure an elderly man strolls with a bird perched on his hand, reminiscent of the tradition of taking pet birds to parks in old times, and another depicts a child holding a sugary fruit treat.

Xu Jie, vice-president of LEGO China, who oversees offline retail business, said, "These beacon stores serve as hubs for fostering connections with consumers and have often hosted themed gatherings and events to attract more visitors."

Paul Huang, general manager of LEGO China, said the company has been exploring how to blend the local culture with personalized experiences to become the go-to play destination in local communities.

With eight flagship stores in the country and more than 460 certified stores in over 120 cities, Huang said they are expanding into more cities to tap into the market's vast potential. The company has built more than 40 percent of its retail stores in cities smaller than third-tier ones.

While the brand enjoys strong recognition in first-tier and coastal cities in China, the company has also become increasingly popular among families and children in smaller urban areas.

"Still, more than 100 cities are untapped for LEGO, prompting more concerted efforts to bring LEGO play closer to home for more children," Huang said.

He added the company has confidence in the Chinese market, buoyed by its sizable young population and middle-income families.

Its confidence is further bolstered by its continuous investment in digital hubs, expansion of production capacities in Jiaxing, Zhejiang province, and the upcoming opening of Legoland Shanghai.

As for digital options, the company has invested in a digital hub and a membership system that provides services and benefits to LEGO players, including the latest product launches and reservations for themed activities, said Huang.

In 2023, the toy market in China saw retail sales up slightly compared to the previous year, with the offline toy market showing a significant recovery.

Department stores and shopping centers showed a significant growth trend. Total retail sales of toys — excluding trendy and collectible varieties — reached 90.69 billion yuan ($12.52 billion), up 2.7 percent, said the China Toy & Juvenile Products Association.

Despite a challenging year for the global toy industry, LEGO Group posted a 2 percent growth in revenue and a 4 percent increase in consumer product sales in fiscal year 2023 compared with a year earlier, with plans to add 40 new stores in China for long-term growth in the market.

CEO Niels B. Christiansen believes there is significant long-term potential for LEGO in China. "We are on the growth journey in China and are hoping and expecting to get back to growth," he said.

wangzhuoqiong@chinadaily.com.cn