An interesting new job advertisement popped up on Seek the other day – LEGO Australia are looking for a Senior Key Account Manager. This normally wouldn’t be particularly interesting as LEGO Australia probably has a lot of account managers. What makes this position a little different is that is specifically relates to working to launch the LEGO and Amazon partnership in Australia.
We’ve known that Amazon is coming to Australia for a little while now, but this is confirmation that LEGO Australia are taking their arrival seriously and already starting work on supplying them with products.
Amazon’s arrival in Australia has got a lot of industry experts speculating about doom and gloom for local retail. As an online presence Amazon doesn’t have the same overheads, and can in theory offer better prices. They are also not above offering deep discounts to get customers to try their service.
Will Amazon become the go-to source of LEGO buying in Australia? It’s extremely difficult to predict this with any certainty but they are certainly facing a lot of challenges.
The Australian LEGO retail landscape is already flooded with sales and discounts. I know this because it keeps me pretty busy. In 2016 there were only a few days that didn’t have some sort of sale on. It is quite easy to purchase LEGO for 20% off if you time things correctly. While stores like Myer and Toys R Us price their LEGO range at RRP, others such as Big W already offer everyday prices lower than RRP.
The popularity of services like lay-buy and Afterpay are also factors that Amazon may need to contend with. There was outrage last year when Target announced that they would not be offering Christmas lay-buy in June/July. LEGO is a fairly expensive product and people have come to expect the ability to pay off their purchases over time, particularly large Christmas purchases. In the US Amazon offers a credit card with an option for 6 month interest free financing on purchases of $149 or more. It is unclear if Amazon will be offering anything like that in Australia. Australia has fairly strict laws for credit providers that Amazon will need to adhere to if they offer a credit card service.
The biggest question mark over Amazon’s potential success is shipping costs and logistics in Australia. 20% off at Amazon with expensive and slow shipping is not as exciting as 20% off at a local retailer or an online store with free shipping. If Amazon roll out their own shipping services and offer features such as next day delivery then that could mean trouble for smaller LEGO retailers stuck with using Australia Post or expensive courier services.
It is difficult to know how the Amazon and LEGO partnership will pan out in Australia with any certainty – Amazon’s Australian launch isn’t scheduled until 2018. Regardless of what happens I’ll be following closely to find the best deals.
If you are an account manager looking for a new job in Sydney you can see the LEGO job ad here https://www.seek.com.au/job/33595139
By buying from Myer when it’s on sale, I get a saving on price and earn Myer One points, which can be converted to gift cards for future use. By buying from Lego Online Shop, I can get VIP points or Double or even Triple VIP points, which can also be used to reduce price on future purchases. I think in the end, where I can get the best discount and extra bonus will determine where I will buy my Lego. If Amazon can offer more than 25% discount plus free postage, I think I may buy my Lego from them. Otherwise, I may stick to my current ways of purchases.
Loyalty programs is a very good point that I hadn’t considered. That might be a way that smaller retailers can take the fight to Amazon too.
Thanks to this site I’ve learned a lot about how much I should expect to be paying for Lego, based upon set availability, the timing of sales and special offers and even the general vibe of popularity of some themes (I’m definitely waiting for some heavy discounting of this years Nexo Knights) so really 30% is the real benchmark of a good deal. Amazon and Lego both know this (Lego identified Australia as a declining toy market last year, despite pricing their product rrp pretty highly) so if amazon are seriously aspiring to disrupt the Australian retail market rather than become just another online retailer (albeit one with extremely impressive search rankings) then they will already know customer expectations. Or am I just over-thinking a children’s toy?
I don’t think you are overthinking a children’s toy at all, because it’s not just AFOLs that are becoming smart shoppers. There are lots of parents buying LEGO for their kids that are aware of sales.