We all know about LEGO. It was a rite of passage growing up. Dump that big bag/box of multi-coloured pieces out and start building something while hoping the family dog didn’t chew up pieces needed to complete your masterpiece. All good fun (although sometimes not so much for the dog).
So, if you are LEGO, how do you embrace culture change and compete with the noise in today’s crowded toy category with a well established brand? Well, it was not without creating some culture change of their own.
Jake McKee, blogger at CommunityGuy, was the Global Community Relations Specialist for LEGO and spoke about how he transformed things at the legendary toy company at BlogOrlando back in October this year.
Having used LEGO as an example in many of my own speaking engagements it was very interesting to hear Jake provide the insight into how he helped lead the process through which they ended up thriving in the world of digital and community.
His story is framed with the Cluetrain Manifesto and how it's principles were adopted to a build a better brand experience. One of the first points Jake makes is that it all began by listening to the market. LEGO had apparently got into a habit of asking retailers (e.g. Wal-Mart) what they should make for stores to stock and sell. Retailers (rightly so) turned around and responded along the lines of "shouldn't you figure that out and tell us"?.
Jake speaks to four lessons in terms of how they embraced a new way of doing business. Below are the main points directly from his presentation that I have adapted.
1. Paranoia kills conversation: Institutional paranoia was pervasive. It surrounded unsolicited ideas from consumers who were proposing new LEGO sets. The problem was that many ideas that LEGO received were projects they were already working on. The threat of lawsuits from litigious individuals who felt their ideas had been stolen stifled conversation with the market.
To keep potential lawsuits at bay (from a minority of individuals), LEGO sent a clear message to everyone that they were not comfortable with, nor could they trust, consumers or their ideas.
LEGO also was protectionist, acting out of the fear that being more open, communicative and collaborative around the core product would provide counterfeiters with valuable information to produce LEGO knock offs better, faster and cheaper. The fear of brand erosion and lost revenue and was driving a mindset of playing their cards too close to their chest, creating layers of secrecy around the brand.
Unfortunately, it took some time to realize that paranoia was actually preventing the brand from furthrer success more than protecting it from potential harm.
2. Small groups mean big power: Companies that fail to understand or care about pockets/segments of their consumer base will lose out. LEGO used to classify adult consumers as “weird”. After all, LEGO is for kids, right? Wrong.
Adult consumers that buy LEGO (those life-long fanatics of the brand) spend close to $2,000 a year on products. Compare that to the average child who has approximately $20-$40 of the product per year bought for them.
LEGO decided it was time to work with the "weirdos". In Seth Godin terms they decided to embrace the LEGO tribe and develop product directly for them. How about a 3,000 piece Star Wars Death Star Destroyer set that costs $300? It sold out in a couple of months and is now on its 15th production run. It continues to sell out.
That's knowing your customers.
3. Air cover and tenacity: The hierarchy needs to be hyperlinked. Organizational structures are not well suited to create open and collaborative dialogue. Internal conversations are typically controlled by job title, but should never be.
When layers prevent ideas from being exchanged, or when speaking your manager’s manager is not allowed, you can’t expect to get anywhere near progress and innovation. You have to be tenacious to get those conversations and meetings happening and break down the barriers. Of course this means being sensitive and respectful to others as you make change happen.
It also means you have to be well prepared and expect that you won't win hearts and minds all on day one.
4. Community solves its own problems: Community members turn to each other for answers and rely on contributors. LEGO had a thriving online community that was posting and cataloguing information as far back as the mid 90’s.
LEGO did not rush out to build something and try to own or dominate the conversation. They chose to go the way of understanding and supporting what was already there. They joined in with their core fans in the established communities and added tremendous value to experience by asking what they could do to enhance what was already going on. Sound smart? You bet.
In summary, this is not rocket science. No slight on Jake as it takes an internal champion like him to make it work. However, it is really common sense when you think about it.
Understanding how to apply the wisdom brought forth in the Cluetrain is an exercise that just might reinvent the way you see the market and ultimately the way the market sees you.
Check out Jake’s presentation at BlogOrlando from his blog, or view the slides via SlideShare (or the embedded one below). While you watch, ask yourself how you might be able to become an agent of change in your company. It can be done.
