The power of brands (and public relations)
A week ago (on 5 September 2017) the LEGO Group announced its first decline in half-year revenues in ten years, a drop in profit, and 1,400 job redundancies.
My eventual reaction was surprise and interest — I am after all a LEGO watcher in a professional (marketing) capacity, but also an adult fan of LEGO.
My immediate reaction, though, was almost one of sorrow. I was upset for the company, not at the company.
Such is the power of a brand that knows what it’s doing.
I noted Chairman Jørgen Vig Knudstorp’s tone in the media release, expressing sorrow at having to make 1,400 employees redundant, all of whom had made contributions to the company’s success, and acknowledging the pain this will cause those affected.
Jørgen Vig Knudstorp’s narrative went further: he was candid about his part in the dip, and equally candid about not being able to guarantee growth for a couple of years. The tone of the media release was calm and clear. It was language unusual to me in such a scenario — and I’ve written, and been part of, many similar announcements in my career.
The reaction around social and mainstream media has been equally measured. The LEGO Group has built a reputation for being open and authentic.
In my own case, I also realized that my brand connection has been built over 50 years. I still have LEGO I had when young (a common experience). There are few brands that can maintain that strong a connection over that length of time, ride the highs and lows with its community and come through intact, and create a genuine reservoir of goodwill with its audience on which to draw in harder times (a tenet of great public relations).
The last time the LEGO Group faced financial uncertainty was back in 2003. Last week’s announcement is nowhere near that serious — but it will be interesting to follow the company’s declared changes, observe (and be part of) these changes, and see how it communications them — all the while maintaining its brand values.
The company took the lead in communicating the news, creating and establishing a position it could defend, and making what appears to be business decisions very quickly. This is a company with steel beneath the smile on the minifig’s face.