Lego China flagship heralds fresh focus on the east

Danish toy brand Lego’s bounce back after a tough financial year has seen new enthusiasm from the brand for expansion into China.

The new energy has seen the retailer open its first Lego China flagship in Beijing last weekend.

A drop in demand for its products during the 2017 financial year – the first since 2004 – saw the brand take a sharp conservative turn last year in order to stabilise the business. Meanwhile, double-digit growth in China brought revenue up 4 per cent to US$5.5 billion with profits of $1.2 billion, accompanied by a degree of sales recovery in the US and western Europe.

“We are especially encouraged by our progress given the challenges facing the toy industry and the departure of specialist retailers such as Toys R Us that went under last year,” said Lego’s CEO Niels B Christiansen. “These shifts gave us the opportunity to strengthen our partnerships with retailers and find new ways to connect with shoppers and consumers across digital and physical channels.”

Buoyed by the encouraging results, and on the heels of the Lego China flagship opening, the company will launch 80 new physical outlets in 18 Chinese cities this year.

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