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Lego aims to expand toy market

By Korea Herald
Published : July 23, 2012 - 20:23
Local unit chief says more competition will help parents realize the ‘play value’ of toys


Danish toy firm executive Steen Lauge Kokkenborg understands that all work and no play makes for a very dull person.

So Kokkenborg, who has been serving as the general manager of Lego Korea for the past two years, has made it his personal mission to spread the importance of “play” in sparking a child’s imagination and helping him or her develop into a well-rounded, well-adjusted adult.

“Korean parents....(sometimes tend) to think that if children have too much fun, they are not learning enough ... but a lot of research (shows) that playing helps develop (their) brains,” Kokkenborg said in an interview in Seoul with The Korea Herald.

In order to tap this potential market, more local and foreign toy companies need to enter the toy business in Korea, according to the local unit head of the famous Danish company, best-known for its colorful plastic brick toys.

“We would like to have more companies coming to Korea...(because) the more companies there are...the better parents will understand the value of playing with (good-quality) toys,” Kokkenborg said.

The Lego Group celebrated its 80th anniversary this year, and the Korean branch has been able to build upon the success of its parent company, according to Kokkenborg.

The local unit was established in 1985, and Lego Korea’s current market share hovers near 25 percent, placing it firmly in the lead among foreign as well as local toy companies in Korea. 

Steen Lauge Kokkenborg (Lee Sang-sub/The Korea Herald)


“(So) our goal for Korea in the next period is actually....(not oriented toward) expanding our own business, but much more on expanding the toy business (here). We want the whole market to grow,” he said.

European toy companies have been slow in tapping the potential of the Korean market, according to the Danish businessman.

Japan’s toy market had its heyday in the ’70s and ’80s, and during the ’90s, European companies turned their eyes toward the Chinese toy market, which became the “next big thing,” Kokkenborg said.

“To a certain extent, (the Korean toy market) was cheated a little bit from getting press coverage in Europe,” he said.

But in the future, he expects attention to turn to Korea, due to the interplay of several factors, such as the greater global prominence of Korean conglomerates such as LG and Samsung.

“(Even) five or six years ago, people would think that Samsung was a Japanese (company). Today...I think everyone’s aware that (it) is...a Korean company,” the Danish toy executive said.

In addition to the greater market prominence of Korean companies, a “made in Korea” label no longer has a stigma attached to it, according to Kokkenborg.

“A ‘made in Korea’ stamp (used to mean) a cheap product that would break down (easily),” he said. But now it tends to be associated with a high- quality product, he added.

All these factors will help make Korea a more attractive market for potential toy investors. But there is a formula that these new players should follow, he said.

In order to enjoy success in the Korean toy market, Kokkenborg said foreign as well as local toy companies should appeal to a unique market audience: Korean parents.

“In Europe there is a tendency to focus exclusively on kids. In Korea, (we) have a different (marketing) strategy,” Kokkenborg said.

For the Lego Group, which boasts a global presence, the company’s product inventory remains pretty much the same from country to country, apart from special limited edition products. So the difference comes in the way the products are marketed or presented to customers.

“(In Korea), we have a much stronger focus on parents than we would have in a Western market. In a Western market the shop would be laid out purely for the kids...(but) here we actually try to make it a little bit easier for parents to navigate, to find out which products are actually best for their kids,” the toy executive said.

“It’s important that we don’t just hijack the children but actually take parents into that dialogue,” he said.

While Korean households with children share similar purchasing power compared to those in other developed countries, Korean parents tend to be more critical in their choice of toys, especially compared to Europeans, according to Kokkenborg.

“They want to make sure that the toys they give their children are high quality and that they also have a purpose. So in that sense Korean consumers are actually better...more concerned consumers,” he said.

This means that Korean parents will tend to buy longer-lasting, high-quality toys like Lego, rather than “throwaway” toys, Kokkenborg said. They also tend to prize a toy’s educational value above all other factors, he said.

Korean children in general also tend to get fewer toys compared to European children, according to the Danish toy executive, adding to the parents’ wish for quality over quantity when purchasing new toys for their children.

Kokkenborg said that he sees a bright future ahead for the domestic toy business.

“We see a potential for the toy market in Korea being at least two to three times bigger than it is today,” Kokkenborg said.

Even the declining birthrate will not drastically affect the domestic toy market, according to Kokkenborg, as this phenomenon is already occurring in other developed countries and it has not had a big impact on toy sales.

“Birthrates are also falling in a lot of European countries, (but) we have seen that the spending per child will go up,” he said.

In short, one should not underestimate the power of the imagination, Kokkenborg said.

For example, just two Lego bricks stacked on top of each other can mean very different things for different people, he said, as he staged a personal demonstration of how to play with the company’s representative, plastic brick toys.

“To (one) kid, this would be a truck. To another kid, it might be a car. And if you put...another top brick back here, you have a small ship. You don’t need a lot of bricks to actually start your imagination. You only need very little,” he said. The Dane has played with Lego toys since childhood.

By Renee Park  (renee@heraldcorp.com)

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