883. Lego's dilemma
Originally, on a day like the Chinese New Year, when the men of the Zhou family played poker, the women should not be idle.
According to the rules of previous years, women should set up stalls to play mahjong at this time.
In this regard, the second aunt is a cow, not to mention at home, even if she plays cards in the mahjong hall outside, she also wins more and loses less, and her combat effectiveness is quite high.
The old Zhou family has people who love to play cards, Zhou Fangyuan's grandmother is another mahjong master of the Zhou family, when the old man is ninety years old, he can still play eight laps in a row, many young people can't sit for so long in one breath, just ask you if you accept it. It's a pity that the old lady passed away last year, and it's really hard to say about this matter, obviously a good person, looking very energetic, and it won't work in the next day. Zhou Fangyuan has a deep relationship with his grandmother, because he has basically never lived with his grandmother since he was a child, but his father has a very high relationship with his grandmother, because it is his own grandmother.
The old lady's living habits are very good, in the morning, it is to boil water to wash eggs and then make cakes to eat, at noon they fry a dish and stuffy rice, take a nap for a while, in the afternoon is a mahjong game that can not be beaten every day, and do not eat staple food at night, generally drink some milk, or drink some oats or something. My health has always been good, I am not sick or sick, and my spirit is comparable to that of young people. But in the middle of last year, one of my relatives, according to the generation, Zhou Fangyuan should be called uncle, is the grandson of the old lady, that is, the youngest son of Zhou Fangyuan's uncle and grandfather, who got married.
At the wedding, as soon as the old lady was happy, she drank an extra drink.
Yes, just a glass.
Usually the old lady attends something, and she only has a tempered cup of two to three taels of drinks, and the old lady was happy that day and drank almost two cups. As a result, when I went home, I felt unwell, and within a week, the person was gone.
At that time, Zhou Fangyuan was abroad, and he was supposed to come back, but his grandfather called him not to come back in a hurry, when he had time, he would come back and put a stick of incense in front of the tomb.
It's not impersonal, it's mainly because there is too much difference in seniority, and I usually see each other at most once a year, so I really don't have any feelings. And the old man is going too fast, hold on a little longer, and you can still send it to the capital to see if you can't keep it, but the old lady's body at that time was in a sharp turn for the worse, and it didn't work in a blink of an eye, and it was too late to send it to the hospital, and the people were gone. This incident hit the family very hard, especially Zhou's father and Zhou Fangyuan's grandmother, who were the saddest.
Now that half a year has passed, they have gradually let go of their worries, but Zhou Fangyuan is at this moment, seeing the Three Kingdoms killing game that Xiaohui has completely "ruled", he feels something.
"Brother, play games with me. ”
The little sister of the third uncle's family ran over, dragging Zhou Fangyuan's clothes and not letting go.
The daughter of the third uncle's family is named Zhou Fangyu, nicknamed Xiaoyu, and she is now the pistachio in the family. Only four years old, officially kawaii age. As for the second uncle's second daughter, Xiaohui's own sister, the little guy is still in infancy, and he doesn't even have the qualifications to play by himself.
Zhou Fangyuan was dragged to the second floor by Xiaoyu, and there was a special game room on the second floor, which was prepared by children. It's just that the old Zhou family is prosperous and yang, Zhou Fangyuan's generation, he was a man in his previous life, and he is still like this in this life. Therefore, there are more dolls in the tollroom, and there are very few entertainment items for boys, only game consoles are one.
But don't say it, Xiaoyu doesn't look like a girl, but she's not very interested in dolls, but she's full of interest in cars, game consoles, and building blocks.
But it's not the kind of simple geometric volume wood, that kind is too low-level, Xiaoyu likes to play with Lego bricks, it is said that she has several large sets of building blocks in her own home, anyway, the third uncle's family is rich, just a few sets of Lego, it's nothing at all. If Zhou Fangyuan has time, he will also find some series abroad that are not yet available in China, buy them, and then give them to Xiaoyu.
Of course, this is already a matter of the past, last year, Yuanfang Group also did a lot of work that is not known to outsiders, one of which is to acquire 11.7% of the shares of Lego through special channels.
Yes, Zhou Fangyuan is already a shareholder of Lego at this moment, and he is quite high in the ranking, and he has the right to speak in the board of directors.
Speaking of Lego, then everyone must be familiar with it, as the world's largest building block brand, Lego has already entered the country.
Since opening its first 20-square-meter store in 1993 at Beijing Lufthansa Department Store, it has taken several years for LEGO to gain a firm foothold in the domestic market. In the previous life, as of 2010, the market growth rate of Lego in China was 45%, and in 2012 it soared to 80%. Since 2013, however, this figure has gradually declined, reaching 25% in 2016. Based on optimistic expectations, LEGO has started to build factories in China, and plans to expand and open stores in second- and third-tier cities.
However, despite the bright future of the market, the toy giants still cannot feel "safe". In this emerging market, local toy manufacturers, toy start-ups with Internet genes, and domestic consumers with more and more choices have grown. Lego is still doing well, but there are hidden dangers. This hidden danger is that there is a gap between its brand positioning, business model, and profit model, which is unsustainable.
How much does it cost to make a block?
David Robertson, a professor at the Wharton School of the University of Pennsylvania, revealed in the book "Lego" that each brick is copied from the corresponding mold. The tooling cost of a Lego standard part is typically between $50,000 and $80,000. A mold can make 60 billion building blocks, so the cost of the mold allocated to each building block is close to zero. However, when it comes to producing special parts, only 50,000 bricks can be made from one mold, and the cost of each part is at least $1.
In addition to the cost of molds, building block manufacturers also need to bear the costs of design, operation, marketing, publicity, logistics and other links. Due to the cost of R&D, materials, company operations, employees and other costs can not be reduced, the profit of Lego toys is actually not high, at least, compared with many multinational companies at the same level, Lego's profit is not enough at all.
During the LEGO transformation in 2004, the product manager gave the designers a specific return figure: 13.5%. If a designer doesn't create a toy that meets this expected rate of return, the toy won't really hit the market. But at the time, most Lego toys didn't meet this standard. Low product margins mean that if Lego wants to get more revenue, the company needs to increase sales or develop other businesses, so the market in China is undoubtedly an important battlefield for Lego to improve its performance.
However, is it easy to get hold of the market in China? It is easy to say that it is difficult, but it is also really difficult, and the first thing to consider is the domestic market environment.
There is a phenomenon, ten years ago, we can call it a cottage, put it ten years later, it is not interesting to talk about cottages, because many small factories in China are indeed no longer satisfied with cottages. They also have their own ideas, their own ideas, and their own brands and directions. But it must be admitted that although there are many things of their own, the foundation is ...... It's still this Lego thing.
As the market becomes more and more competitive, LEGO, which is difficult to reduce costs, will face several serious market challenges.
Before the cake can be divided, LEGO needs to build its own moat. If LEGO education can be combined with toys to create differentiated courses around 'soft' education, direct consumers to LEGO stores and build a brand, then education is LEGO's moat. However, if Lego fails to build a moat in the Chinese market, then the high cost seems to be doomed to Lego to share the market with a group of "imitators".
That's where it is today.
I still remember that at the end of 2015, Lego advertised in Shanghai: "There is only one kind of building block, which can be called Lego bricks." ”
Next to the picture of the yellow bricks, which has been enlarged several times, Lego wrote, "This little brick in front of you is different and cannot be copied." ”
The difficulty of replicating Lego bricks lies in the high manufacturing standard of the building block parts, the size of the Lego bricks is as low as 0.002 mm, and the "ABS" material is chemically stable, brightly colored and harmless. However, two years after this advertisement, Lego is still repeating the Lego brand in the Chinese market. To this end, LEGO also created another advertisement that reiterates that "LEGO products are LEGO products with the LEGO logo". It looks like saying, you imitate it, but don't call yourself "Lego"!
However, this has not affected the fundamental competitiveness of local toy brands in the face of Lego - price.
"Lego is too expensive. It cost three or four hundred yuan, and the child spent a day to build it, and it was a waste to put it away. ”
This is the idea of many parents.
It's not that everyone is reluctant to spend money on toys for their children, as long as it is beneficial to children, many parents are willing to spend this money. But the problem is that when there are a large number of similar products on the market, although the quality is slightly poor, but the price gap is huge, it is an individual who knows how to choose. Even at the time of Zhou Fangyuan's rebirth, there were already a large number of products on the market that were highly similar to Lego bricks. These building blocks can also be assembled and spliced at will, and the quality is not too bad, but the price is much cheaper. Someone has calculated that a box of toys with 200 blocks costs 100 yuan soft girl coins, and two palm-sized Lego fire trucks are about 300 yuan, and the cost performance of the two sides is not at the same level at all.
Of course, LEGO products are more elaborately designed. But due to the price, many people don't take the initiative to buy genuine Lego toys most of the time.
It's like when foreign fast food such as McDonald's and Kentucky Chicken first entered the country, people would celebrate their birthday at the fast food restaurant and treat it as a high-end restaurant. But when consumption becomes more rational, consumers will find that McDonald's is an ordinary fast food restaurant. So very simply, when ordinary consumers feel that there is no need to buy Lego bricks, small brands will eat away at Lego's market share little by little.
It's not about one giant beating another giant at all, it's a pack of wolves taking over the territory little by little, robbing Lego of its own modest profits.
Moreover, ordinary people do not know much about the market, and may feel that the development of the domestic toy industry is average, but what is the fact? Although the domestic toy market has not improved for many years, there is no shortage of toy manufacturers in China. About 80% of the world's toys are produced in China, and most of the exports of China's toy industry are processed and produced for foreign brands. Among them, Guangdong Province is also a major toy province in China.
What does this mean, it shows that we have a complete enough industrial chain and enough small toy companies. Mainland toy manufacturers have a large price gap with international brands, so they have strong competitiveness in the mid-to-low-end market, which is prone to a long-tail effect. At the same time, with the growth of the toy market, local toy manufacturers are also trying to transform into toy brands, and carry out their own product research and development, marketing and sales. In 2010, Lego tried to turn things around, and in 2010, Lego filed two lawsuits against a toy company in Guangdong Province for infringing its copyright, but the court rejected both cases. But in 2006, the Canadian building block brand Meigao appealed to the European Union Trademark Office, arguing that granular blocks should not be the patent of any one company, and the case was won.
It can be seen from this that even if it is imitated, there is nothing Lego can do, because the bricks themselves are not the patent of a certain company.
You can use it, and others can naturally use it, it's just that you used it early and became more famous.
For imitators, it can be said that as long as it is not too excessive, the kind that is completely copied without brains, even if it is as strong as Lego, it can only be swallowed by breaking teeth in the stomach.
In addition to intellectual property rights, cultural and educational differences are also two other important reasons why Lego is prone to imitators in the domestic market.
In 1997, two years before the official release of the movie "Star Wars Prequel", Lego was discussing with Lucasfilm, the film's production company, to discuss the licensing of the partnership. Eventually, the LEGO Star Wars series became a bestseller in the LEGO Group. However, domestic consumers are not very familiar with the Star Wars series of movies. Most of the products favored by domestic users are complete sets of automobiles, rockets and other products that do not have IP halo and have strong reproducibility.
For parents in China, they value the educational function of LEGO, that is, children can play with bricks to flexibly fingers, so as to improve brain development and develop creativity. But this feature isn't exclusive to LEGO bricks, either.
In fact, all building block games, more or less, have similar capabilities, so why does Lego compete with small domestic companies? The international market has been basically saturated, but the Chinese market is not easy to carry out business in the case, Lego is also forced to have no choice, when the distant group released some goodwill, Lego after a short discussion, or feel that strategic cooperation with the distant group, the two sides cross-shareholding, is the good thing for Lego.
So when Zhou Fangyuan was watching Xiaoyu play games, he began to think about how to help Lego carry out various promotions and marketing in China.
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