Why Lego Is So Expensive | So Expensive | Business Insider

[Music] this thief is stealing $1,500 worth of Lego according to the store's owner but that's just the tip of the iceberg in the past decade there have been a slew of Lego thefts including one totaling about $300,000 but why are thieves around the world targeting a toy well one reason might be that the most expensive Lego sets cost more than an iPhone 15 that's why this guy was trying really hard to reach the top shelf these went from around $120 to overnight selling on eBay for several th000 my friends and family don't actually know about

this room I think they'd probably be quite shocked if I ever open the door and they saw the Lego that was in here but it wasn't always like this in 2006 Lego's most expensive set was $270 so how did we get here how did Lego go from a children's toy to a collector's item and why is it so expensive today Lego is the world's largest toy company a but its story didn't start with plastic bricks it started with wood while Lego found success with wooden toys the company's first first major turning point came in 1949

when its founder took a Gamble and started manufacturing plastic bricks plastic toys were cutting edge technology at the time but Lego wasn't the first to pursue this idea here are two patents by a company called Kitty craft from 1939 and 1945 and well you can decide how much inspiration Lego took plastic bricks didn't click right away leg had to stick with the product and innovate to pull kids away from wooden and metal toys and to understand the price of Lego today we have to rewind to its very first set it was just a box of

bricks without instructions some of the earliest gift sets cost 25 Danish Crone about $60 today but in 1955 Lego released the town plan a simple version of the sets we have today kids built buildings and combined them to create little Lego cities with this release Lego solidified what it called the system in play its guiding philosophy would be that every brick should fit together and stand the test of time allowing kids of all ages to build in unlimited ways and we can't not mention the reasonably priced line then in 1958 Lego perfected its bricks with

the stud and Tube method an interlocking design that enabled large yet stable builds Lego uses that design for its bricks to this day Lego is brilliant pieces that were built from the beginning of Lego interact with pieces that were built today with just a few [Music] exceptions do you know about Brown there were some brown bricks that were made like during a certain period Lego that were more delicate than others and like if you try to build with some of those bricks today they're a little brittle but 99.9% of all Lego that has ever been

made is designed to stand the test of time and is Awesome by the 1960s plastic bricks were a hit and Lego made them its full Focus but at the time Lego's products were still pretty simple aside from Reinventing the wheel in 1962 its builds were blocky and predominantly used the classic rectangular brick Lego's second major turning point came in the 1970s when it started to release more creative sets like the 1978 space cruiser it had1 170 pieces and cost $10 or about $48 today Lego referred to these themed sets as the system within the system

they added new pieces that expanded the Lego palette like colored transparent parts and thrusters for Builders like Dave these pieces expanded the possibilities of Lego it's really fun to have other options because it's not like drawing where you have unlimited possibilities like your limitations are the brick that exists so every time a new piece or a new color gets added it's exciting so builds that I built like 10 years ago I would build totally different now because there's an expanded pallet of what's available to build with throughout the 70s Lego transformed from a toy into

a creative [Music] medium releasing dozens of new parts sets and even debuting the iconic mini figure the company experienced huge success and worldwide growth in the 1980s hour after hour day after day year after year Lego changes there's no end to Lego but much like those brown bricks cracks were starting to show by the late 1990s sales slumped and the company was losing money for the first time ever Lego had grown rapidly and spread itself too thin investing heavily in theme parks media properties and merchandise meanwhile sales for its original Focus the brick or slipping

Lego released sets that required less building ignoring what fans loved about the toy take the galador theme which barely resembles a Lego Product every Dimension needs a hero every hero needs a special power in galador it's glitching glitching was not going to save Lego that'ss like those had oneoff pieces that didn't fit into the Lego system they cost more to manufacture and were less profitable an executive would later say we had actually seen a decline in profitability yet we continued to invest as if the company were growing very strongly we failed to realize that we

were on a slippery path the company's annual report described 2003 as a very disappointing year for Lego company Executives were also concerned that physical toys might not keep up with the exploding video game industry one of the few things that kept Lego afloat was Bionicle the company's best seller for 4 years straight another bright spot was its licensed Star Wars sets first released in 1999 these ranged in price from $6 to $90 and they flew off the shelves licens sets would become hugely important for Lego but more on that later outside the company something unexpected

was growing all on its own it turned out that kids weren't the only ones who thought Lego was fun even in college I was like my friends were like going out to the bars and I was like well but I could buy some more Lego with that money Dave is what some people refer to as an a adult fan of Lego which I don't know I mean it's it's a term that we use somewhat endearingly but uh you know it's also a little cheeky his skill and passion for Lego earned him a spot on the

TV series Lego Masters which millions of viewers watch weekly for its competitions between adults I'm like a super fan I watch like the international versions too I love it but the hobby looked a lot different when Dave first started building before the 2000s even Lego's most complex sets had young age recommendations like N9 and up or 11 to 16 but that didn't deter creative people like Dave from getting into the hobby this is like 40 years of collecting Lego it's almost embarrassing to think about how much the dollar value is of this Lego if I

buy a a set I'm taking that apart I'm building it once to like learn the techniques but then I'm taking that set apart and integrating that into this collection so that I can use the pieces for my own ideas by the 1990s there was a growing group of passionate fans like Dave who had either played with Lego as a kid or discovered it in adulthood as a creative outlet and they were spending a lot on Lego for enthusiasts having a room or an entire base dedicated to Lego is a common practice everybody has a different

system that works for them it's in here somewhere you just have to find it the system's always changing one of my favorite containers right here I sold those three goats recently got quants and bottles and eggs chicken legs so this is a whole container that just has minifigure hair maybe this is a little morbid but you could have a whole container of just minifigure heads it's definitely more than 100,000 bricks in this room it's probably somewhere between 100,000 and 500,000 just individual Lego elements in this room but like some of them are really small I

mean there's probably 10,000 pieces right here Dave estimates his collection is worth about $50,000 there's lots of ways to have a collection to build up you know it might be a collection of vacations that you've taken over time and this is a collection of memories and builds and pieces from many many many years of doing this I love it because it's a way to tell stories I can talk about or think about like things that have been happening in my life or things that are happening in the world or tell imaginary stories I was like

you know younger building by myself in my apartment it's a very solitary thing building Lego you're usually by yourself or maybe with a sibling or a family member it really can be for anybody because there's so many different ways to be with Lego in the 1990s The Passion of Builders like Dave was quietly growing waiting for a spark that would forever change the hobby You've Got Mail I'm at the center of the web high-tech illusion fantasy someone can hardly turn the computer on it's all a bit worrying when the internet started to catch on people

like me who had been building discovered that there were other people like me and it was great to be able to connect to see that other people were building it wasn't just just like building in solitude and that's really I think when Lego started to become something else and not just a kid's toy but Lego didn't always accept or understand its adult fans one former executive said that decades ago Lego Saw fans like Dave as a source of irritation another said Lego didn't think their adult fans had value one of LEGO's former CEOs said we

kept thinking thinking that much more should be done for the adult most people on the management team thought we should concentrate on children instead for a long time up until the 1990s being a fan of something was not seen in a positive light like why are you wasting your time playing with Legos and so I can totally see why a company in in the 1990s would really want to reject that but the A4 community's momentum was not easily stopped it was growing not just online but in person people from all over the world would come

together to be part of a convention in the early 2000s conventions helped fans connect and build a strong Community it was also great marketing for Lego because enthusiasts would display giant Creations like this 8ft wide lord of the Rings build that took 11 years to construct I don't know how much it cost it was definitely in the thousands like for me now I'm done by buying Lego I I feel like I have enough here I've been playing with it since I was a kid I got my first set when I was four or five good

portion of the apartment is filled with Lego when we buy a house we'll very quickly have a Lego basement we often find the most powerful fandoms and the longest lasting fandoms come from the community they tend to be Grassroots or ground up kind of fandoms that sort of creative transformation coheres a fan Community I think stronger than if a media Corporation or a toy company says here's the way I want you to be a fan but remember this set I bought two I sold one and I think I'll hold this one for a while and

see where I get to one huge aspect of the hobby driven by the community is the resale Market Lego retires its sets every few years after that if you want to buy it or need a specific piece your only option is to buy secondhand because of this artificial scarcity some sets Skyrocket in value and Savvy buyers view Lego as an investment so this is my Lego storage room I'd say there'd be over 600 to 700 of them stored inside this room my kids aren't allowed in here probably could be stored better but I have an

air vent for ventilation and store a lot of them in cabbo boxes to keep the boxes in good condition I know the retail value of the sets I've purchased is over $50,000 secondary Market value I would suspect it's uh a lot more than that some of the sets alone are worth three to four times what the retail price was I keep this nicely locked away that is not a set to play [Music] with Justine says she collects Lego not with the intention of reselling but because she wants to build each one just to get it

out that's a big however know many sets increase in value gives her some pause in cracking open the box so I don't really have a strategy or approach to buying Lego uh I buy what I like unfortunately I like a lot on occasion I have bought a set twice cuz I've forgotten that I purchased it there is one minifigure alone within that set Harley Quinn that is worth $400 and the set itself is worth $1,200 so I'd love to build it but at the same same time it's really hard to say I'll go you know

spend $400 overnight while building that set and uh reducing its value my ratio of built Lego to Lego in box is probably a little out of whack prices on the secondhand Market can be eye watering like a mini figure like this could go for like $200 cuz it's a very rare minifigure that only appeared in one set ever but not everything multiplies in value and this massive network of spare parts is what empowers Builders like Dave I probably ordered like 2,000 lightsaber rods just to make this floor it doesn't even look like Lego anymore I'm

putting them on their ends and putting them all so close together that they make that hexagonal tile in the early 2000s Lego's fans were innovating more than the company was and in order to survive it needed to embrace ail Lego recognized it was pursuing a losing strategy while ignoring a key customer base to turn the tide it cut costs sold the theme parks and refocused on its Core Business of building with bricks and it was time to finally consider adults in 2004 Lego now under a new CEO planned to fundamentally change the way it did

business over the next few years it sought to improve its products by developing what it referred to as Grassroots collaboration with its adult fans in addition to making sets more profitable Lego needed to recapture customer excitement and who better to ask for help than its most passionate fans in its 2006 annual report Lego said it obtained means inspiration from the many independent homepages and clubs for Lego enthusiasts all over the world in 2007 Lego released a $500 Millennium Falcon with over 5,000 pieces recommended for ages 16 and up this marked a jump in set complexity

price and Target demographic to put this change into perspective the 1999 Star Wars Padres set cost $90 had 896 pieces and listed an age range of 8 to 12 they've also hired people like me who were Lego builders to work for them the things that we kind of pioneered are now being pioneered by the people who work at Lego so it's much more exciting because the techniques in Lego sets have become more advanced and you learn more when building a Lego set than when you did when you were a kid and the sets were simpler

when fans are running the thing that they're a fan of they can expand it in ways they know other people will enjoy this is the start of the company's thirdd Turning Point getting kids and adults excited about Lego to achieve this Lego released bigger more interesting sets and expanded its licensed products brand tians in Lego sets work phenomenally to get people interested in purchasing the set people that are fans of that particular brand might purchase the Lego set that wouldn't normally buy Legos this strategy coincided with an explosion of pop culture fandoms and a growth

of what's referred to as the kol industry kol Industries are industries that produce products that we would associate with children but aimed at an adult market and it's become a huge area of business Lego released its first 18 plus set in 2020 and since then the company has released dozens of products each year clearly targeting adults some of these sets like the Star Wars at at are complex with thousands of pieces and a price tag to match others feature themes like dried flowers that try to appeal to older Builders these sets are also perfect to

display once once you've built them I display my doctor who Legos because I want people to know that that's that's an important part about who I am and I'm proud of that previously nerdy things and hobbies and fandoms are absolutely a part of mainstream popular culture today now Lego's website even says adults welcome this strategy allows Lego to cater to a customer base and a price point it couldn't reach if it only focused on kids I personally don't set myself a budget for Lego because if I did I'd just blow it Lego also acquired Bricklink

the largest Lego resale Marketplace in 2019 at the time Lego's CEO said our adult fans are extremely important to us we have worked closely with the community for many years and look forward to deepening our collaboration we've seen just how much money that sort of thing makes that gives it uh seriousness but I think also because we've just kind of normalized weirdness in a in in a way that makes me really [Music] happy I really never cared for what the age was on the Lego set because I was like I want the pieces I just

want the pieces to build but it's good messaging I think from Lego to say like this isn't just a kids toy this is for adults too and for me it didn't matter but I think for a lot of people it is welcoming and Lego's plan to save the company worked two decades later the company boasts nearly 10 times the revenue but amid this success profits weren't the only number going up walking down the toy aisle and seeing Lego sets priced at hundreds of dollars can be alarming but is Lego actually more expensive than 10 or

20 years ago to answer this question let's look at price per piece that's the price of a set divided by how many pieces are included it's not a perfect measurement and it doesn't include Min figures but think of it as a broad look at the value of a set remember that 2007 millennium Falcon that had a price per piece of 10 cents a decade later Lego released a new Millennium Falcon with over 7,500 pieces for $850 and a price per piece of 11 that's just 1 cent higher and adjusted for inflation it's actually 1 cent

lower some set themes are more expensive than others but the price per piece has remained surprisingly stable over the past 20 years ironically some of the worst value sets are ones designed for young children like Duplo this set has a price per piece of $130 so why are sets more expensive they're much more complex this chart shows an increase in average set prices since 2014 but it aligns with an increase in average pieces per set since the same year they could do a Millennium Falcon for 30 bucks and it wouldn't look as good and it

wouldn't be as big but they know that they can do this big one because there is a market for it so if you're walking through Target seeing high prices and thinking that Lego is expensive you're not entirely wrong since 2020 Lego has released significantly more sets that cost cost over $300 but it's also releasing more sets overall about twice as many annually as it did in 2008 and about four times the amount it released in the 1990s you can have unlimited pieces but it's also fun to like just build with what you have and sometimes

the limit of what you have is more challenging than building with unlimited pieces once in a while I'll be working on something I'll be like well is it worth it for me to go buy more of this or can I find another solution for it with what I have so that I don't have to buy more of something that's really what Lego is about is creative problem solving is like can I solve it this way is there another way to solve it or is there a third way that I haven't even thought about [Music] yet

going all in on the brick helped Lego beat the one hit wonder problem many toy companies have but it also created an ecosystem and a creative medium that has endured nearly 70 years of competition and shifting pop culture my mom tells me that she got me my first Lego set when I was 4 years old I don't think I could have predicted where Lego would go I love Lego because I feel the Nostalgia from when I was a kid you know it brings me back to those moments of sitting on the rug building that set

being young and enjoying that and I like the way that it connects Generations that adults can play with the same toy with their kids that they played with when they were a kid it's continually new and it's continually refreshing and that's in its DNA I don't think we're ever going to see a fandom for Lego die in the way that we might for a media text which waxes and wns over time my hope for the future is that it will continue to be more accessible to people whether that through having representation of different people in

their sets or price I think price is a block for a lot of people how can we make it an entry point that is accessible to everyone I would hope that like people who watch this think when they look at Lego and then they look at this they're like oh you have to have that much Lego to be an amazing Lego builder it's not really about that the coolest techniques I've come up with or that I've seen other people use are when they when they have constraints it's not really about like how much you have

it's about Ingenuity it's about trying to find different ways to solve problems so I wouldn't ever be intimidated by seeing something huge it's okay to just put a couple pieces together and have it be something amazing [Music]