Lego’s success leads to competitors, spinoffs

The Philippine Star

When Paul Hollingsworth tried to recreate “Jurassic Park” in a video using Lego bricks, he ran into a roadblock. Lego offers plenty of T. rexes, velociraptors and other dinosaurs, but not Richard Attenborough or Jeff Goldblum, who played characters in the movie.

Fortunately, Mr. Hollingsworth had been collecting Legos since he was a child and had amassed $40,000 worth of bricks, so he combed through older Lego sets like Harry Potter and Indiana Jones until he found the pieces he needed to recreate those characters.

“They have so many different themes and bricks, you can build anything you want,” said Mr. Hollingsworth, the founder of Digital Wizards Studios, a production company in Sherman Oaks, Calif., that makes stop-motion animation shorts using Lego bricks. The company grew out of his hobby of making videos with his daughter, Hailee, 9, who reviews Lego sets on YouTube.

For others, the task of simply building a Lego set is worthy of a video. Emily Lakdawalla, a senior editor for the Planetary Society, a nonprofit organization run by Bill Nye, was undaunted when she set out to build a replica of the Taj Mahal, which, at 5,922 pieces, is Lego’s largest set.

A longtime Lego collector, she has sets that date to the 1980s. “I obsessively organize them,” she said. “Everything is separated by type and color. I have file folders I use to organize all the instructions.” So with help from her two daughters, she completed the Taj Mahal in five days and posted a time-lapse video on YouTube.

Videos like these are one reason sales of construction toys have surged. They can mix and match multiple entertainment properties — such as a “Simpsons” character using a castle from Disney’s “Frozen” or “Star Wars” and Halo characters engaged in a battle — and they encourage fans to show off their creativity and building skills.

“User-generated content has drawn a lot of attention to the brands,” said Jim Silver, the editor of TTPM, a toy review website. “You could have a Scooby Doo set and find Darth Vader inside.”

Lego, the undisputed construction toy king, has more than doubled its profits in the last five years and many of its sets are top sellers during the holiday season. Its success and the fact that it lost a long-running trademark battle over the interlocking brick in 2010 have encouraged competition.

Big toy makers like Hasbro, Mattel and Spin Master have also turned to construction toys to help bolster their sales. And smaller companies like the Bridge Direct, Cobi and OYO Sports have entered the field, putting more pressure on Lego. Interest in construction toys has even led to a secondary market of brick rentals.

Lego’s competitors say they want to distinguish themselves from their biggest rival. MEGA Brands, a subsidiary of Mattel and Lego’s closest rival, goes “above and beyond the squares and rectangles,” said Andrew Sparkes, vice president for global brand marketing at MEGA Brands.

“We are creating some of the most realistic sets out there,” he said, including sets based on the Halo video games and the movie “Terminator Genisys.” MEGA recently signed licensing deals for the classic “Star Trek” TV series and Teenage Mutant Ninja Turtles.

MEGA Brands was acquired by Mattel in 2014 in a deal that increased MEGA Brands’ worldwide distribution, said Gerrick Johnson, analyst for BMO Capital Markets. That global reach may have helped MEGA Brands secure licenses for brands like SpongeBob SquarePants and Teenage Mutant Ninja Turtles, because with a smaller company like MEGA Brands, “you might get more attention and innovation,” Mr. Johnson said.

Other companies are exploring themed sets that do not fit with Lego’s more wholesome brand.

“We have values in place that the brand is known for that we focus on,” said Michael McNally, brand relations director for Lego. “We don’t do military themes or anything overly violent or grotesque.”

Todd McFarlane was happy to pick up the mantle. He started McFarlane Toys in 1994 with a focus on sophisticated action figures, but he recently began to apply his attention to detail to construction toys. He wanted a theme untouched by Lego, so he started with sets based on the immensely popular television show “The Walking Dead,” which was soon followed by “Game of Thrones” sets.


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