No Discounts Policy on LEGO Exclusives & Hard to Find Items

[Mrbill317]

Disappointed by the policy and wishing I'd bought Town Hall from Amazon earlier this year when it was down to $175. But I can't really blame LEGO for doing it.

As far as the question about whether there is any reason for other retailers to carry these sets, I see a few. Many of these retailers have their own credit cards with "points" systems; even though I get a different kind of points when buying from LEGO, I might prefer the Amazon points for some purchases. Also, for birthdays and holidays, many people are more likely to receive a gift card from somewhere like Amazon, Target or Wal Mart than from LEGO, and since these cards are likely not nearly the full amount of an exclusive set, the retailers will still be making some profit.

Isnt the Town Hall 177 on Walmart.com anymore?

[stevebuscemi]

With freebees I still get a good discount on them. Heck, VIP bonus is 10% now.

Also, this means you won't be pissed off later when it's offered at a much cheaper price. So it will keep it's value much better.

[Max Power]

This is a horrible policy. The vip points barely cover tax and you can't use them until your next order. Since s@h barely has sales, it it better to just buy from another store then use VIP points. Lego is making a ton of money and now they are turning into apple. I know this will greatly decrease the number of exclusives I buy. Price fixing, limited the number of sets you can buy and producing more parts in China is going to make me go back to collecting transformers.

[slisa51]

This doesn't have anything to do with Lego making more on each exclusive. I heard it began when amazon had the fire brigade for sale for several months well under retail. There were also several other sets from other retailers well under msrp and that was causing Lego to not be able to move there sets in store or online. They were also getting angry customers in store when they would not price match.
I don't think you will ever see Lego budge on this policy but other retailers are already finding loopholes such as offering a gift card back with your purchase instead of taking dollars or a percentage off. 2 weeks ago Target was offering a $10 gift card with a $75+ purchase and 5% off with there red card. I think you will see Toys R Us do this during the holiday season also. The Policy also allows for a retailer to discount a dollar amount off an entire transaction but not a direct discount on a single exclusive. So a sale of $25 off your purchase of $200 or more would be ok even if a $150 grand emporium was part of the transaction.
Any retailer found in violation of this policy is suppose to lose the right to carry the exclusive that was discounted for 6 months. There are still several retailers that have already broken this policy but I don't believe Lego has taken any action against them.

[dulait]

While I understand the policy from LEGO's point of view, they need to realize what this is going to do on the negative side of things.

FRAUD FRAUD FRAUD will be on the rise, even more than it is now.

The scammers with stolen credit cards will now be selling more and more of this high priced exclusives, because not every casual shopper will not be familiar with this new pricing policy. When the scammers price these sets lower than retail and list the sets on eBay, vulnerable eBay consumers will be buying them up 10x stronger than when they could find similar pricing on Amazon and other retailers. Even worse, the scammers will not have to low-ball the set prices as much so It will be harder to tell if it is just a consumer with buyers remorse, someone who hoarded the sets pre-policy and wants to unload or really a scammer trying to maximize his profits.

If you are not familiar with the scam I am referring to:

Scammers list High priced LEGO sets that they don't actually have, when someone buys it on eBay the scammer uses a stolen credit card to buy the LEGO set from LEGO.com and has it shipped to the address of the purchase that purchased it from them on eBay. The scammer gets the cash from the ebay buyer who doesn't know they are involved in a scam, the company who issued the credit card that is stolen is F-ed.

I wonder if LEGO.com even cares if they do millions in sales that are fraudulent, when the issuing credit card company is the one footing the bill?

Consumers and credit card companies BEWARE!

Lego is already doing something about that it seem,
http://www.toysnbricks.com/forums/viewt ... =52&t=9474" onclick="window.open(this.href);return false;

There are still several retailers that have already broken this policy but I don't believe Lego has taken any action against them.

Once Lego open a store in every major shopping mall, then they can speak louder, right now they still need retailers like Walmart to help them on selling their products. I agree with what others have said, I remember discussing with someone about why anyone would want to buy exclusives and hard to find from the Lego Store while many can find them cheaper elsewhere. I guess Lego finally realized that and this is the action they are taking.

[King]

Interesting thoughts C&T, I have had some that are in the same school of thought. To add on to your reasoning...

Think of TRU.. they mark up prices, why? Because their main target audience is the 'average buyer' who just wants to pick up a quick toy for their child/gift/etc., not the collectors. Same mentality. TLG wants to grow market by increasing number of sales rather than volume as C&T explains above. Sure, AFOLs put a nice chunk of change in their pocket, but they also are savy enough to avoid paying what Lego deems fair value for their sets, so their profit margin isn't as good for us as it is for the avg joe TRU audience Lego wants too.

One of the difficulties I think they've faced lately, is trying to figure out production runs. CMF production was too short, then too much, etc. Mass buying of Exclusive/HTF sets (Modulars, High Dollar Sets in general) when found on discount, but when full price, sales stagnant. How can they figure out what is actually selling well, and what is moving because of price/discount. It also has caused shortages of certain sets (Ninjago Spinners?) which created an uproar / backlash. Especially for Lloyd ZX. I would bet most of the production went to resellers first.

Remember that "Exclusive" sets are generally great PPP, have exclusive parts/minifigs, etc. They are more expensive to make, have smaller production runs, and aren't as profitable. They bring in the business with the wow factor though. They need to be able to better control their production forcasting unless you want costs to keep going up (a response to heavy discounting IMO).

Finally, I think you could argue that in general the heavy discount puts downward pressure on Lego's price... savy folks realize "you should never buy a set unless you get at least a 25% discount.." because it was so common. That gave TLG a huge disadvantage for those Exclusive sales because they only offer % discounts on special sales days, and those are very rare and not high %'s and not very many sets. Why "only get double VIP points and a free polybag" for buying full $150 for a Modular, when I could wait to get the Modular for $110, pay $10 to a reseller for the Polybag, and still be better off since I don't have to buy anything else to actually get the 'discount'.

But this isn't only about the discount. They will not even sell to "non end users" at full price. (Just try to buy 10 Pet Shops from S@H) Many large buyers have even offered to pay full price now and have the sets delivered at a later date rather than take them "out of the hands" of buyers. TLG has declined.

"Stopping resellers" is the excuse, but the policies they have put in place do almost nothing to stop that. Using one of your examples...how would this policy stop eBay sellers from cleaning Wal Marts or Targets out of Lloyd ZX spinners? Instead they have shifted a huge amount of their AFOL traffic away entirely or just to another retailer who gets a cut of the money.

Wouldn't it be smarter for TLG to get 100% of a $135 sale when a 10% coupon is used rather than $100 when Wal Mart sells the same item to that customer?

Ultimately, this all seems to spring out of the Minecraft debacle, which this really does little to address. The true resellers (the big ones on eBay) don't care about this policy. They will do everything they can to get around it just like they do on Amazon since the limits were put in place. They have 10, 20 addresses or more to ship items to. (I knew one in the past that said he had 12 PO Boxes for getting around posted limits)

Yet, if you are an AFOL looking for solid bricks and plates packs with a good PPP, you are out of luck with TLG who has decided to treat you like some sort of criminal for wanting to buy 10 of a set.

King

[swills]

With freebees I still get a good discount on them. Heck, VIP bonus is 10% now.

Also, this means you won't be pissed off later when it's offered at a much cheaper price. So it will keep it's value much better.

In general I am not a fan of this move (things being more expensive = bad for my bank account) but I can see the logic behind it. I think the above point gets overlooked though - right now if you buy a modular, you spend $200 (Canadian) and get $20 back in points, plus a cute little $13 set, plus free shipping.

I mean sure it might not look as good as 20% off but it isn't that bad.

I think this might also give Lego a bit of room to drop their prices too (born optimist here). If more Exclusive purchases go through them as opposed to Amazon/ToysRUs, and they no longer have to worry about making a profit when then set is at 20% off then there's room for a little downwards movement while still maintaining the same profit margins.

[scandell]

Smart shoppers still have several ways to get great discounts on these sets.

Exactly. I am picking up what you are putting down...

[Deathleech]

Why doesn't Lego allow you to use the 10% off coupon on their exclusive/hard to find sets? They are still getting your money and making a nice profit and it's a little extra incentive to buy directly from Lego. It's not like 10% off is that much anyways, even on the expensive exclusives. Like someone else mentioned, the 5% back with VIP really isnt even that big of deal. Taxes alone are well over 5% and you don't have to pay them in most states through Amazon. Other places like Target offer a flat 5% off with a red card which is better than the Lego VIP system. You don't even get anything off your initial purchase, just once you reach 100 points which can be used towards your NEXT purchase. Plus if something is .99 cents they round DOWN the 99 cents rather than round up one penny which is just stupid.

I mean I understand not wanting places like Amazon to discount sets 20-30% off within a few months. That has to hurt Lego pretty bad. I know I prett much wait for these sales all the time because they are so good. But why only restrict exclusives and not ALL Lego sets then?

For people saying its a supply and demand thing, I find that hard to believe. I rarely if ever see sets sold out at Lego S@H, and if they are it's for a relatively short time. I know they have limits but can't you get around that easily by placing multiple orders (never tried so I dunno if you can or not)?

If Lego really wants to get people buying directly from them what they need to do is offer better incentives. Instead of some random polybag or set I have no interest in let me pick out a $10 set in a theme I want for every $100 or $150 I spend? Also make it 10% with VIP all the time rather than a paltry 5? And round UP a penny rather than down almost a full dollar? These changes would cost them very little but could totally sway me from buying from places like Amazon. As is I can get free shipping at Amazon and only need to spend 1/3 what I do at Lego S@H, I only get 5% back at Lego rather than 20-30% off, and the exclusive or polybag barely is worth the taxes I'm not paying at Amazon.

[littlemic]

well this is a popular topic so here's my 2 cents

I went to real LEGO store this week (as opposed to browsing amazon LOLOL) and the kids were koo koo yapping running around excited as all heck while the parents had that "OMG how much is this going to cost" look And I'm also guessing that AFOLs spend more $$ on legos than parents buying them for their kids, but if LEGO just focused on AFOLs that is a shrinking market yes ? What is the best way to create more AFOLs ? Get them hooked as kiddies, I'm guessing (alot of guessing here ) that most AFOLs also played with legos as a kid instead of suddenly deciding at 35 hey that little plastic brick kiddy toy looks fun, let's spend a few $1000 on them. Again the architecture line is different & clearly marketed for adults, but even there, look at the Design Studio product, that is geared for arch students in college to get them hooked etc.

If pay closer attention, you'll notice that although there are always kids running around in LEGO store, many parents only buy small sets (i.e. < $50) for the kids. LEGO is an expensive toy, without discount, my family has to cutdown on purchases. We have been waiting for Cinema and Tower of Orthanc to go on sale but now so disappointed that we have to remove them from our list...

[marcusloignon]

With freebees I still get a good discount on them. Heck, VIP bonus is 10% now.

Also, this means you won't be pissed off later when it's offered at a much cheaper price. So it will keep it's value much better.

Right, VIP points are now 10% used to buy more of TLG product, not the same as saving 10% for a purchases at another retailer.

[Brick & Blue]

Why don't they just stop giving the coupons out? Would have been easier and made more sense then coming off like assholes.

I really like the Amazon part, does that mean LEGO is banning Amazon from selling sets for cheaper? If so I'd still buy from Amazon just to screw over LEGO and little bit I can.

[kohmonster]

The policy isn't well known here. It's never been communicated to me in any form until I went to the store and attempted to use my coupon on an exclusive. Funny thing is I had about a grand worth of other sets I was going to buy at full price for gifts. I'm the kind of consumer that doesn't waste his time with companies that want to be stupid, I left the store with all my money and no sets, went elsewhere and bought different gifts that weren't lego. Apparently they want to protect their price point so badly on the exclusives it makes more sense to them to lose the complete sale. I'm happy to oblige.

[frackbricks]

People are talking about how they are going to buy at other stores. This is fine, but if you buy lego at another store lego still gets their money.

[brickarmor]

TERRIBLE policy, period. It will benefit no one. TLG will lose sales, fans, and luster. If Minecraft and Lloyd brought the issue of reselling to a boil, and the well-publicized story of the boy who saved his pennies for a year to buy Emerald Night only to discover that it was discontinued added gas to the flame, TLG is approaching this as if the solution is to get rid of the stove. Plain dumb.

I'll be dumbfounded if this asinine contrivance lasts even a year or two. Everybody--all the brick and mortar retailers and their online hubs--will be sitting on stock doing nothing but gathering dust. Fail fail fail.

[peanut]

I love how not only is Lego upping the price per piece constantly, but Toys R US goes above and beyond to price Gouge and charge 30% more! Should work both ways then according to this report that seems to be true...... Let's be "CONSISTENT" LEGO GROUP!?

I know right. Consistent in sales-speak must have a different meaning

Would TLG honestly give up all the sales from Target Amazon and Walmart if they ignored the new terms, or would they only take away the Exclusive and HTF sets from them?

[hatcher]

Just to refresh your memories. A few years back Walmart in Canada stopped selling LEGO. They wanted to charge the same prices for LEGO in Canada as in the US (or at least closer) since the Canadian dollar was at that time worth more then the US dollar. Lego said no. Walmart said either lower the prices or we'll stop carrying LEGO. LEGO said go ahead. Well, that didn't last long. Walmart Canada is once again carrying LEGO, and charging exactly what LEGO tells them to. If the world's largest retailer couldn't get LEGO to lower prices, what makes you think they'll listen to anyone? This policy might result in certain retailers dropping the exclusives if people stop buying them from them, but LEGO won't care.

[Francfurters]

Wow, price fixing indeed.

[utahkei]

i would hope other competitors such as mega bloks , kre-o knex could do better so we have other alternatives

[dulait]

Just to refresh your memories. A few years back Walmart in Canada stopped selling LEGO. They wanted to charge the same prices for LEGO in Canada as in the US (or at least closer) since the Canadian dollar was at that time worth more then the US dollar. Lego said no. Walmart said either lower the prices or we'll stop carrying LEGO. LEGO said go ahead. Well, that didn't last long. Walmart Canada is once again carrying LEGO, and charging exactly what LEGO tells them to. If the world's largest retailer couldn't get LEGO to lower prices, what makes you think they'll listen to anyone? This policy might result in certain retailers dropping the exclusives if people stop buying them from them, but LEGO won't care.

I believe it was Walmart that were trying to get the same ordering price as they did down in the states, and Lego told them no, but I did not recall they ever were gonna sell sets at US prices up here. Maybe if that did happen, we might have seen prices like $89.99 USD, and $105.99-115.99 CAD compared to $119.99 CAD right now.

i would hope other competitors such as mega bloks , kre-o knex could do better so we have other alternatives

Not a big fan of either, but that is a good idea if they do. Right now, some sets from both were hard sells even when they were mark down to 50%. Until then, Lego is like Walmart, they rule the market since all the other competitors are pretty weak.