Lego.com Case Study
Lego Mindstorms
The non-commercial website Lego.com has been an enormous success providing Lego with a strong presence on the Internet. However, implementing a website capable of handling sales transactions requires a great deal more than a non-commercial site. The firm has implemented an ERP system which may provide some technical support for the website. The details of the ERP system are unknown at this time; however, the goal of implementing the system was to optimize the supply chain from production to distribution, which will be a significant opportunity for the E-Commerce project. Another important consideration is incorporating the ERP system into the E-Commerce transactions so that separate systems and processes are not necessary.
The Lego company enjoys worldwide brand recognition; ranking 5th in the global toy market behind such giants as Mattel Hasbro Sega and Nintendo. The Lego.Com website is among the top 10 sites for children. Both of these factors represent a significant strength for the firm over competitors. The firm has traditional sold to retailers and other middlemen and has little experience in direct consumer sales. This has been the case in the past the typical buyer of Lego’s products are not the consumers’ of the product. The firm currently generates 5 % of total sales from the catalog sales of its products. The catalog operations may provide supporting resources for direct sales logistics and experience in direct consumer sales. The firm has both financial and employee resources to support the E-Commerce implementation.
Lego’s philosophy underlies all company activities and supports to a large degree their branding strategy. The Lego vision “Idea, Exuberance and Values” requires that all Lego products stimulate children’s imagination, creativity, and are high quality products. The LEGO MINDSTORMS products as all products in Lego’s offerings align with the firms overall philosophy and represent a strength for the company. However, the E-commerce site must handle sales in a way that supports the firms’ philosophy; such as quality service, creativity, and the belief that “children are the vital concern.” The LEGO MINDSTORMS product line already meets the standards; however, the website and the entire process including marketing to order fulfillment must be carried out in the traditional Lego phil...
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...rations has been established the firm could begin to integrate the entire process and other business aspects (flow of information).
In conclusion, the Lego’s strengths include brand awareness, significant resources that are already in place all over the world, and experience in terms of the catalog operation and the issues arising from selling to children. Weaknesses include concerns of selling to an international market (marketing, legal, language, and currency), lack of experience in the area of E-Commerce, handling the logistics of distributing and direct sales to the consumer, and as for any firm the added complexity in terms of business and technical considerations. Obvious opportunities arising from the E-Commerce operations are increased sales, new markets, integrating other areas of the business such as billing and distribution, and offering more an more of the products online. Threats such as customer’s having a great deal of pricing information, lacking the ability to meet the order to fulfillment speed expected, technical problems, and the problem of enticing customers away from the firm’s traditional buyers.
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Based on analysis of harvard case study
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