Why Lego is so expensive
Lego is the world's largest toy company but it's gained a reputation for being an expensive hobby. Since 2007, Lego has released dozens of sets that cost over $300. The most expensive Star Wars sets cost $850. And prices for vintage Lego sets can reach over $1,000. These high prices have caught the attention of thieves, who in some cases have stolen about $300,000 worth of Lego. So, how did we get here? How did Lego go from a children's toy to a collectors item? And why is it so expensive?
Transcript
00:00This thief is stealing $1,500 worth of Lego, according to the store's owner.
00:07But that's just the tip of the iceberg.
00:12In the past decade, there have been a slew of Lego thefts,
00:16including one totaling about $300,000.
00:20But why are thieves around the world targeting a toy?
00:25Well, one reason might be that the most expensive Lego sets cost more than an iPhone 15.
00:32That's why this guy was trying really hard to reach the top shelf.
00:37These went from around $120 to overnight selling on eBay for several thousand dollars.
00:45My friends and family don't actually know about this room.
00:48I think they'd probably be quite shocked if I ever opened the door and they saw the Lego that was in here.
00:53But it wasn't always like this.
00:55In 2006, Lego's most expensive set was $270.
01:00So how did we get here?
01:03How did Lego go from a children's toy to a collector's item?
01:08And why is it so expensive?
01:13Today, Lego is the world's largest toy company.
01:20But its story didn't start with plastic bricks.
01:23It started with wood.
01:26While Lego found success with wooden toys,
01:29the company's first major turning point came in 1949,
01:33when its founder took a gamble and started manufacturing plastic bricks.
01:38Plastic toys were cutting-edge technology at the time,
01:42but Lego wasn't the first to pursue this idea.
01:45Here are two patents by a company called Kitty Craft from 1939 and 1945.
01:52And, well, you can decide how much inspiration Lego took.
01:57Plastic bricks didn't click right away.
02:00Lego had to stick with the product and innovate to pull kids away from wooden and metal toys.
02:06And to understand the price of Lego today, we have to rewind to its very first set.
02:13It was just a box of bricks without instructions.
02:16Some of the earliest gift sets cost 25 Danish kron, about $60 today.
02:22But in 1955, Lego released the Town Plan, a simple version of the sets we have today.
02:30Kids built buildings and combined them to create little Lego cities.
02:34With this release, Lego solidified what it called the system in play.
02:39Its guiding philosophy would be that every brick should fit together and stand the test of time,
02:45allowing kids of all ages to build in unlimited ways.
02:50And we can't not mention the reasonably priced line.
02:55Then, in 1958, Lego perfected its bricks with the stud-and-tube method,
03:01an interlocking design that enabled large yet stable builds.
03:06Lego uses that design for its bricks to this day.
03:10Lego is brilliant.
03:12Pieces that were built from the beginning of Lego interact with pieces that were built today.
03:20With just a few exceptions.
03:25Do you know about brown?
03:27There were some brown bricks that were made during a certain period of Lego that were more delicate than others.
03:33And if you try to build with some of those bricks today, they're a little brittle.
03:3799.9% of all Lego that has ever been made is designed to stand the test of time and is awesome.
03:45By the 1960s, plastic bricks were a hit, and Lego made them its full focus.
03:52But at the time, Lego's products were still pretty simple.
03:56Aside from reinventing the wheel in 1962, its builds were blocky and predominantly used the classic rectangular brick.
04:06Lego's second major turning point came in the 1970s, when it started to release more creative sets, like the 1978 Space Cruiser.
04:16It had 170 pieces and cost $10, or about $48 today.
04:23Lego referred to these themed sets as the system within the system.
04:28They added new pieces that expanded the Lego palette, like colored transparent parts and thrusters.
04:35For builders like Dave, these pieces expanded the possibilities of Lego.
04:41It's really fun to have other options, because it's not like drawing where you have unlimited possibilities.
04:48Like, your limitations are the brick that exists.
04:52So every time a new piece or a new color gets added, it's exciting.
04:56So builds that I built like 10 years ago, I would build totally different now because there's an expanded palette of what's available to build with.
05:05Throughout the 70s, Lego transformed from a toy into a creative medium.
05:14Releasing dozens of new parts, sets, and even debuting the iconic minifigure.
05:22The company experienced huge success and worldwide growth in the 1980s.
05:27Hour after hour, day after day, year after year, Lego changes.
05:32There's no end to Lego.
05:35But much like those brown bricks, cracks were starting to show.
05:41By the late 1990s, sales slumped, and the company was losing money for the first time ever.
05:49Lego had grown rapidly and spread itself too thin, investing heavily in theme parks, media properties, and merchandise.
05:58Meanwhile, sales for its original focus, the brick, were slipping.
06:04Lego released sets that required less building, ignoring what fans loved about the toy.
06:11Take the Galador theme, which barely resembles a Lego product.
06:15Every dimension needs a hero. Every hero needs a special power.
06:22In Galador, it's glinching.
06:25Glinching was not going to save Lego.
06:29Sets like those had one-off pieces that didn't fit into the Lego system.
06:34They cost more to manufacture and were less profitable.
06:39An executive would later say,
06:42We had actually seen a decline in profitability, yet we continued to invest as if the company were growing very strongly.
06:49We failed to realize that we were on a slippery path.
06:53The company's annual report described 2003 as a very disappointing year for Lego Company.
07:01Executives were also concerned that physical toys might not keep up with the exploding video game industry.
07:08One of the few things that kept Lego afloat was Bionicle, the company's bestseller for four years straight.
07:16Another bright spot was its licensed Star Wars sets, first released in 1999.
07:23These ranged in price from $6 to $90, and they flew off the shelves.
07:29Licensed sets would become hugely important for Lego, but more on that later.
07:35Outside the company, something unexpected was growing, all on its own.
07:41It turned out that kids weren't the only ones who thought Lego was fun.
07:48Even 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.
07:58Dave is what some people refer to as an A-Fol.
08:01Adult fan of Lego, which, I don't know, I mean, it's a term that we use somewhat endearingly, but, you know, it's also a little cheeky.
08:12His skill and passion for Lego earned him a spot on the TV series Lego Masters,
08:19which millions of viewers watch weekly for its competitions between adults.
08:24I'm like a super fan. I watch like the international versions, too. I love it.
08:28But the hobby looked a lot different when Dave first started building.
08:33Before the 2000s, even Lego's most complex sets had young age recommendations, like 9 and up or 11 to 16.
08:42But that didn't deter creative people like Dave from getting into the hobby.
08:47This is like 40 years of collecting Lego.
08:51It's almost embarrassing to think about how much the dollar value is of this hobby.
08:56The dollar value is of this Lego.
08:59If I buy a set, I'm taking that apart. I'm building it once to like learn the techniques,
09:04but then I'm taking that set apart and integrating that into this collection so that I can use the pieces for my own ideas.
09:11By the 1990s, there was a growing group of passionate fans like Dave,
09:16who had either played with Lego as a kid or discovered it in adulthood as a creative outlet.
09:22And they were spending a lot on Lego.
09:26For enthusiasts, having a room or an entire basement dedicated to Lego is a common practice.
09:35Everybody has a different system that works for them.
09:39It's in here somewhere. You just have to find it.
09:42The system's always changing.
09:44One of my favorite containers right here.
09:47I sold those three goats recently.
09:50Got croissants and bottles and eggs, chicken legs.
09:54So this is a whole container that just has minifigure hair.
09:59Maybe this is a little morbid, but you could have a whole container of just minifigure heads.
10:05It's definitely more than 100,000 bricks in this room.
10:09It's probably somewhere between 100,000 and 500,000 just individual Lego elements in this room,
10:17but like some of them are really small.
10:20I mean, there's probably 10,000 pieces right here.
10:24Dave estimates his collection is worth about $50,000.
10:29There's lots of ways to have a collection to build up.
10:33It might be a collection of vacations that you've taken over time.
10:36And this is a collection of memories and builds and pieces from many, many, many years of doing this.
10:45I love it because it's a way to tell stories.
10:49I can talk about or think about things that have been happening in my life
10:54or things that are happening in the world or tell imaginary stories.
10:58I was younger building by myself in my apartment.
11:04It's a very solitary thing building Lego.
11:07You're usually by yourself or maybe with a sibling or a family member.
11:11It really can be for anybody because there's so many different ways to be with Lego.
11:17In the 1990s, the passion of builders like Dave was quietly growing,
11:25waiting for a spark that would forever change the hobby.
11:30You've got mail.
11:33I'm at the center of the web.
11:36High-tech illusion. Fantasy.
11:39If somebody can hardly turn the computer on, it's all a bit worrying.
11:42When the internet started to catch on,
11:46people like me who had been building discovered that there were other people like me.
11:52And it was great to be able to connect to see that other people were building.
11:57It wasn't just like building in solitude.
12:00And that's really, I think, when Lego started to become something else and not just a kid's toy.
12:05But Lego didn't always accept or understand its ability to connect.
12:10It didn't always accept or understand its adult fans.
12:14One former executive said that decades ago, Lego saw fans like Dave as a source of irritation.
12:21Another said Lego didn't think their adult fans had value.
12:26One of Lego's former CEOs said,
12:29we kept thinking that much more should be done for the adult.
12:33Most people on the management team thought we should concentrate on children instead.
12:38For a long time, up until the 1990s,
12:41being a fan of something was not seen in a positive light.
12:46Like, why are you wasting your time playing with Legos?
12:49And so I can totally see why a company in the 1990s would really want to reject that.
12:58But the AFOL community's momentum was not easily stopped.
13:03It was growing not just online, but in person.
13:08People from all over the world would come together to be part of a convention.
13:14In the early 2000s, conventions helped fans connect and build a strong community.
13:20It was also great marketing for Lego, because enthusiasts would display giant creations.
13:27Like this 8-foot-wide Lord of the Rings build that took 11 years to construct.
13:33I don't know how much it cost. It was definitely in the thousands.
13:37Like, for me now, I'm done buying Lego. I feel like I have enough here.
13:44I've been playing with it since I was a kid. I got my first set when I was four or five.
13:49A good portion of the apartment is filled with Lego.
13:53When we buy a house, we'll very quickly have a Lego basement.
13:58We often find the most powerful fandoms and the longest-lasting fandoms come from the community.
14:05They tend to be grassroots or ground-up kind of fandoms.
14:10That sort of creative transformation coheres a fan community,
14:15I think, stronger than if a media corporation or a toy company says,
14:21here's the way I want you to be a fan.
14:25But remember this set?
14:27I bought two, I sold one, and I think I'll hold this one for a while and see where I get to.
14:33One huge aspect of the hobby driven by the community is the resale market.
14:39Lego retires its sets every few years.
14:43After that, if you want to buy it or need a specific piece, your only option is to buy second-hand.
14:50Because of this artificial scarcity, some sets skyrocket in value,
14:56and savvy buyers view Lego as an investment.
15:00So this is my Lego storage room.
15:04I'd say there'd be over 600 to 700 of them stored inside this room.
15:10My kids aren't allowed in here.
15:13Probably could be stored better, but I have an air vent for ventilation,
15:17and store a lot of them in cardboard boxes to keep the boxes in good condition.
15:22I know the retail value of the sets I've purchased is over $50,000.
15:27Secondary market value, I would suspect it's a lot more than that.
15:33Some of the sets alone are worth three to four times what the retail price was.
15:39I keep this nicely locked away.
15:42It is not a set to play with.
15:47Justine says she collects Lego not with the intention of reselling,
15:52but because she wants to build each one.
15:55Just have to get it out. That's a big one.
15:59However, no many sets increase in value gives her some pause in cracking open the box.
16:06So I don't really have a strategy or approach to buying Lego.
16:11I buy what I like. Unfortunately, I like a lot.
16:14On occasion I have bought a set twice because I've forgotten that I purchased it.
16:19There is one minifigure alone within that set, Harley Quinn,
16:22that is worth $400, and the set itself is worth $1,200.
16:27So I'd love to build it, but at the same time it's really hard to say,
16:31I'll go spend $400 overnight while building that set and reducing its value.
16:38My ratio of built Lego to Lego in box is probably a little out of whack.
16:45Prices on the second-hand market can be eye-watering.
16:50Like a minifigure like this could go for like $200
16:55because it's a very rare minifigure that only appeared in one set ever.
16:59But not everything multiplies in value.
17:02And this massive network of spare parts is what empowers builders like Dave.
17:07I probably ordered like 2,000 lightsaber rods just to make this floor.
17:14It doesn't even look like Lego anymore.
17:15I'm putting them on their ends and putting them all so close together
17:21that they make that hexagonal tile.
17:24In the early 2000s, Lego's fans were innovating more than the company was.
17:30And in order to survive, it needed to embrace AFOLs.
17:35Lego recognized it was pursuing a losing strategy while ignoring a key customer base.
17:42To turn the tide, it cut costs, sold the theme parks,
17:47and refocused on its core business of building with bricks.
17:51And it was time to finally consider adults.
17:55In 2004, Lego, now under a new CEO, planned to fundamentally change the way it did business.
18:04Over the next few years, it sought to improve its products
18:07by developing what it referred to as grassroots collaboration with its adult fans.
18:13In addition to making sets more profitable, Lego needed to recapture customer excitement.
18:20And who better to ask for help than its most passionate fans?
18:24In its 2006 annual report, Lego set it obtains inspiration
18:30from the many independent homepages and clubs for Lego enthusiasts all over the world.
18:35In 2007, Lego released a $500 Millennium Falcon with over 5,000 pieces,
18:43recommended for ages 16 and up.
18:47This marked a jump in set complexity, price, and target demographic.
18:52To put this change into perspective, the 1999 Star Wars Padre set cost $90,
18:59had 896 pieces, and listed an age range of 8 to 12.
19:05They've also hired people like me who were Lego builders to work for them.
19:11The things that we kind of pioneered are now being pioneered by the people who work at Lego.
19:18So it's much more exciting because the techniques in Lego sets have become more advanced.
19:23And you learn more when building a Lego set than when you did when you were a kid and the sets were simpler.
19:30When fans are running the thing that they're a fan of,
19:35they can expand it in ways they know other people will enjoy.
19:40This is the start of the company's third turning point,
19:44getting kids and adults excited about Lego.
19:48To achieve this, Lego released bigger, more interesting sets,
19:53and expanded its licensed products.
19:56Brand tie-ins in Lego sets work phenomenally to get people interested in purchasing the set.
20:02People that are fans of that particular brand might purchase a Lego set that wouldn't normally buy Legos.
20:09This strategy coincided with an explosion of pop culture fandoms,
20:14and a growth of what's referred to as the kidult industry.
20:18Kidult industries are industries that produce products that we would associate with children,
20:25but aimed at an adult market. And it's become a huge area of business.
20:30Lego released its first 18-plus set in 2020.
20:35And since then, the company has released dozens of products each year, clearly targeting adults.
20:42Some of these sets, like the Star Wars AT-AT, are complex, with thousands of pieces and a price tag to match.
20:50Others feature themes like dried flowers that try to appeal to older builders.
20:55These sets are also perfect to display once you've built them.
21:00I display my Doctor Who Legos because I want people to know that that's an important part about who I am.
21:07And I'm proud of that.
21:09Previously nerdy things and hobbies and fandoms are absolutely a part of mainstream popular culture today.
21:18Now, Lego's website even says, adults welcome.
21:23This strategy allows Lego to cater to a customer base and a price point it couldn't reach if it only focused on kids.
21:32I personally don't set myself a budget for Lego, because if I did, I'd just blow it.
21:37Lego also acquired BrickLink, the largest Lego resale marketplace in 2019.
21:44At the time, Lego's CEO said,
21:47We've seen just how much money that sort of thing makes.
21:51That gives it seriousness.
21:55But I think also because we've just kind of normalized weirdness in a way that makes me really happy.
22:03I really never cared what the age was on the Lego set, because I was like, I want the pieces.
22:09I just want the pieces to build.
22:11But it's good messaging, I think, from Lego to say, like, this isn't just a kid's toy.
22:16This is for adults, too.
22:18And for me, it didn't matter.
22:20But I think for kids, it did matter.
22:22And I think it's a good message.
22:24I think it's a good message.
22:25And Lego's plan to save the company worked.
22:28Two decades later, the company boasts nearly 10 times the revenue.
22:31But amid this success, profits weren't the only number going up.
22:36Walking down the toy aisle and seeing Lego sets priced at hundreds of dollars can be alarming.
22:42But is Lego really worth the money?
22:45We'll find out.
23:05But was Lego actually more expensive than 10 or 20 years ago?
23:09To answer this question, let's look at price per piece.
23:13That's the price of a set divided by how many pieces are included.
23:18It's not a perfect measurement, and it doesn't include minifigures.
23:23But think of it as a broad look at the value of a set.
23:27Remember that 2007 Millennium Falcon?
23:30That had a price per piece of 10 cents.
23:32A decade later, Lego released a new Millennium Falcon.
23:37With over 7,500 pieces for $850.
23:41And a price per piece of 11 cents.
23:45That's just one cent higher.
23:47And adjusted for inflation, it's actually one cent lower.
23:52Some set themes are more expensive than others.
23:56But the price per piece has remained surprisingly stable over the past 20 years.
24:02Ironically, some of the worst value sets are ones designed for young children, like Duplo.
24:09This set has a price per piece of $1.30.
24:14So why are sets more expensive?
24:17They're much more complex.
24:22This chart shows an increase in average set prices since 2014.
24:28But it aligns with an increase in average pieces per set since the same year.
24:34They could do a Millennium Falcon for $30.
24:38And it wouldn't look as good, and it wouldn't be as big.
24:41But they know that they can do this big one because there is a market for it.
24:46So if you're walking through Target seeing high prices and thinking that Lego is expensive, you're not entirely wrong.
24:53Since 2020, Lego has released significantly more sets that cost over $300.
25:00But it's also releasing more sets overall.
25:04About twice as many annually as it did in 2008, and about four times the amount it released in the 1990s.
25:12You can have unlimited pieces, but it's also fun to just build with what you have.
25:17And sometimes the limit of what you have is more challenging than building with unlimited pieces.
25:23Once in a while, I'll be working on something and be like,
25:26well, is it worth it for me to go buy more of this?
25:30Or can I find another solution for it with what I have so that I don't have to buy more of something?
25:36That's really what Lego is about. It's creative problem solving.
25:39It's like, can I solve it this way? Is there another way to solve it?
25:42Or is there a third way that I haven't even thought about yet?
25:54Going all in on the brick helped Lego beat the one-hit-wonder problem many toy companies have.
26:01But it also created an ecosystem and a creative medium that has endured nearly 70 years of competition and shifting pop culture.
26:12My mom tells me that she got me my first Lego set when I was four years old.
26:18I don't think I could have predicted where Lego would go.
26:24I love Lego because I feel the nostalgia from when I was a kid.
26:29You know, it brings me back to those moments of sitting on the rug, building that set, being young and enjoying that.
26:38And I like the way that it connects generations.
26:41That adults can play with the same toy with their kids that they played with when they were a kid.
26:50It's continually new and it's continually refreshing and that's in its DNA.
26:56I 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 wanes over time.
27:04My hope for the future is that it will continue to be more accessible to people,
27:09whether that's through having representation of different people in their sets or price.
27:16I think price is a block for a lot of people.
27:19How can we make it an entry point that is accessible to everyone?
27:23I would hope that people who watch this think, when they look at Lego and then they look at this,
27:29they're like, oh, you have to have that much Lego to be an amazing Lego builder.
27:33It's not really about that.
27:35The coolest techniques I've come up with or that I've seen other people use are when they have constraints.
27:41It's not really about how much you have.
27:44It's about engaging people in the way that you can.
27:49It's not really about how much you have.
27:52It's about ingenuity.
27:54It's about trying to find different ways to solve problems.
27:57So I wouldn't ever be intimidated by seeing something huge.
28:01It's okay to just put a couple pieces together and have it be something amazing.