LEGO Continues to Build On Its Success with its ‘Retailtainment’ strategy

LEGO Continues to Build On Its Success with its ‘Retailtainment’ strategy

December 14, 2021
3 min read

Following the opening of LEGO’s new retail outlet in Malaysia, we explore why the high street is still an important part of shopping and how retailers could differentiate their in-store shopping experiences to respond to changing consumer needs. 

Online and Physical Stores are Complementary to Each Other

LEGO’s first ‘Retailtainment’ flagship store in Malaysia was recently opened at Kuala Lumpar’s Sunway Velocity Mall. The innovative store celebrates the local architecture of the Petronas Twin Towers and KL Tower, much as the Barcelona store incorporated inspiration from architectural icon Antoni Gaudí and other unique local features.

The move is part of LEGO’s global store expansion strategy which debuted at its New York store, called ‘Retailtainment Center’ back in June 2021. The company’s new shop format is being hailed as a groundbreaking retail innovation offering unique immersive digital and physical shopper experiences. LEGO’s strategy, published in 2023, outlines a view to maintain this global expansion in the interest of creating a memorable and accessible retail experience for all LEGO lovers, wherever they are in the world. They have also set out some longer-term strategic goals that prioritise reducing environmental impact and optimising digital technology.

The opening continues for  LEGO’s ‘Retailtainment’ store rollout worldwide. The financial results from 2022 confirmed that the high street is far from dead as channels, online and physical are complementary to each other. 

A shift in Shopping Habits

While the convenience of online shopping means it is here to stay, consumers are starting to visit brick-and-mortar locations again. This shift in shopping habits is not confined to the APAC consumer. It is posing unprecedented challenges to retailers to diversify their in-store shopping experiences from what they offer online, engaging consumers in physical locations with social and playful activities to build an in-depth brand/customer relationship. 

As highlighted in Mintel Trend Experience Is All, most consumers still value the advantages of shopping in-store, which include the ability to try products in person and to be helped by customer service associates which are also among the key USPs of LEGO. 

LEGO Leicester Square Store, London. Source: Mintel

Mintel’s Traditional Toys and Games US Report showcases that consumers need toys and games to bring more than just fun, and brands can connect with adults by appealing to their need for wellness. As explored in Mintel’s ‘Retail Watch’ blog, it is clear that LEGO got that right during the rather stressful (and gloomy) pandemic period and should continue to recoup the benefits in the short to medium term. 

What We Think

In an era where the price can often seem like the deciding factor, the value of a real, hands-on experience may be more welcome than ever. To combat the stay-at-home-or-stay-online mentality, retailers must pay heed. Brands and retailers need to extend their offer beyond mere retail and act as a venue, not just a shop. Investments in human resources need to deliver the differentiation of a ‘human touch’ and stores need to avoid ‘showrooming’ through initiatives like redeemable in-store credits and in-store exclusives.

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Utku Tansel
Utku Tansel

Utku Tansel LLB, MBA is Mintel’s Retail Analyst and is responsible for our research and reports covering European retail markets.

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