With the number of international Legoland parks set to hit double figures, the theme park chain’s reach is wider than ever. Here’s how it has developed into one of the world’s biggest brands in family entertainment over the past five decades.
Next year, 52 years after the debut of Legoland Billund, the ninth Legoland will open in the US state of New York. The global Legoland parks portfolio will span 10 sites when Legoland Korea Resort opens in Chuncheon, an hour east of Seoul, in 2022. Further worldwide expansion of the brand is planned. Discussions are ongoing regarding several potential projects in China. Eventually, Merlin hopes to have 20 Legoland parks around the world.
The rollout of new Legoland parks has accelerated over the past eight years under the watch of Merlin Entertainments. The British company took control of the business more than a decade ago. It has since leveraged the Legoland brand to help it grow into the world’s second largest attractions operator.
The international Legoland Parks portfolio
Here is a summary of the current Legoland parks, and those coming soon:
- LEGOLAND Billund Resort, Denmark. Opened June 7, 1958, next to Lego company headquarters in the town of the same name.
- LEGOLAND Windsor Resort, England. Launched 1996 on the former site of Windsor Safari Park outside London.
- LEGOLAND California Resort, USA. Located in the city Carlsbad outside San Diego. Opened in 1999, it is one of the largest Legoland parks to date.
- LEGOLAND Deutschland Resort, Germany. Opened 2002 in the rural Bavarian town of Günzburg.
- LEGOLAND Florida Resort, USA. Launched late 2012 on the site of the former Cypress Gardens amusement park in Winter Haven, between Tampa and Florida.
- LEGOLAND Malaysia Resort. Located in Iskander, Johor, the park sits on the Malaysia-Singapore border. It debuted in September 2012.
- LEGOLAND Dubai, United Arab Emirates. One of three theme parks at Dubai Parks and Resorts opened in October 2015.
- LEGOLAND Japan Resort. Located in the city Nagoya, opened in April 2017.
- LEGOLAND New York Resort, USA. The 150-acre park is set to open in 2020 in the city of Goshen, New York.
- LEGOLAND Korea Resort, Chuncheon, Gangwon Province, South Korea. Opening in 2022.
More than just a theme park
In addition to its portfolio of Legoland Parks, Merlin runs a worldwide chain of over 20 indoor Legoland Discovery Centres. These neatly dovetail the Legoland brand with Merlin’s operational experience in ‘Midway’ (short stay) attractions. With these outlets in the mix, Legoland branded facilities now account for around a quarter of Merlin’s 120+ global attractions.
Most of the Legoland parks are now marketed as ‘resorts’. That means they feature at least one hotel. Some also include ‘second gate’ attractions such as a Legoland Water Park or Sea Life aquarium.
However, Legoland has humble roots as an attraction. The park that greeted guests in Billund back in June ’68 (as pictured below) was small. It comprised little more than an open-air Lego model village – what is now called Miniland – circled by a train ride. And its location in a lowly-populated town on Denmark’s Jutland peninsula was hardly a tourist trap.
Nevertheless, Legoland Billund was “immediately very popular,” says John Jakobsen. The 55-year-old Dane has been instrumental to the international expansion of Legoland. Both with Merlin, where he currently serves as chief new openings officer, and previously during a 22-year career with the Lego Group.
Legoland’s winning formula
“The Lego Group expected about 200-250,000 visitors during the first season in Billund,” says Jakobsen. “The park got about 600,000.”
Aimed at families with children aged three to 12, the Legoland offer is considerably broader today. Each resort typically entertains between 2 to 2.5 million annual guests, fewer at Legoland Dubai, but more at Legoland California.
“Guests can enjoy a wide range of attractions and features you would expect in a great theme park, but with that Lego connection and familiarity,” says Hans Aksel Pedersen. He succeeded Jakobsen as managing director of Legoland Parks in 2015. The fellow Dane began his theme park career as Legoland Billund’s sales & marketing director in 2000 before going on to take up positions at Legoland Windsor, Legoland Deutschland and as Merlin’s divisional director for Legoland Parks in North America.
All of the current Lego parks feature staples such as the Dragon Coaster, Driving School, Boating School and Legoland Express. Water rides and features are popular too. Newer offerings include the interactive dark ride Ninjago The Ride. Yet in reality, most activities now feature an element of interactivity.
In keeping with Lego’s values, the parks encourage learning through play. In this way, Legoland has been ahead of the family attraction Zeitgeist for some time. And Miniland, with buildings and landmarks familiar to the local audience, remains at the heart of every Legoland park.
Worldwide expansion (and a false start in the ’70s)
After the early success of Legoland Billund, there was a lot of interest in opening further Legoland parks. Initially, this came from other parts of Europe. Eventually, the Lego Group struck a deal to develop a park by the coast in northern Germany. Legoland Sierksdorf, on the site of what is now Hansa-Park, opened in 1973 but survived for just four seasons.
“I think, in hindsight, there were a number of things that weren’t done right,” says Jakobsen. “The distance to Legoland Billund, only a couple of hours’ drive away, was not sufficient so as to appeal to a different market. Also, the park was done in partnership with another entity that went bankrupt. So the Lego company withdrew.”
Legoland goes to Great Britain
That German experience in the ’70s was an important lesson for the Lego Group. It retreated to Denmark to concentrate on its core business. “Then, in the late ’80s, the next generation owners began looking at opportunities with a fresh set of eyes,” says Jakobsen.
In the early ’90s, by which time Jakobsen was on board, Lego decided on a plan of worldwide expansion starting with two new parks. One would be in North America, but the other had to be in Europe.
“Although we were convinced it would be great to go to some remote location like Japan,” says Jakobsen, “that was more of a long term opportunity. We realised it was probably a good idea if we tested our concept first in a place that was more reachable from Denmark, and understandable from a language and culture point of view.”
Great Britain was good for Lego toy sales. Furthermore, Legoland Billund already received some British visitors.
“We looked all over Britain,” says Jakobsen, “but were very interested in the west side of London. “However it was very difficult to get a site with planning permission. So when Windsor Safari Park came up for sale, we knew it was an opportunity we had to go for. The park opened in March 1996 and the rest is history.”
Taking Legoland stateside
As when Merlin later bought Cypress Gardens and turned it into Legoland Florida, the site in Windsor benefitted from an existing park infrastructure. The first Lego park in North America, however, would be on the West Coast. Lego hit upon a clever way to get developers to knock on its door.
“We secured an article on the front page of the Wall Street Journal by giving them the exclusive that we were looking for a Legoland park in America,” says Jakobsen. “And it worked. We were literally inundated with proposals. They were all really good, in very strong locations. We narrowed the final list down to an East Coast location just outside of Washington DC, and the chosen location for Legoland California north of San Diego.”
The Californian park opened on March 20, 1999. In searching for a fresh German site, the Lego Group has a different outlook than back in the ’70s. “We were interested in the southern part of Germany. Partly in order to create the necessary distance from the Legoland Billund,” says Jakobsen. “But also because the south of Germany is a very strong market in terms of tourists and resident base.”
Evolving the Legoland experience
The state of Bavaria, where Legoland Deutschland is located, is also close to Switzerland and Austria. Neither of these markets has a particularly high penetration of theme parks. However, says Jakobsen, “Legoland parks are a very unique experience. So we are not necessarily looking out for how much supply there is of other theme parks in the region.”
More important is the local Lego following. And here Germany, Austria and Switzerland all score highly. The park has performed well since opening in September 2002. Last season it matched the attendance of Legoland Billund, welcoming 2.25 million guest visits.
The German resort has also proved to be a useful test site for themed accommodation. That includes offerings such as the first Legoland Castle Hotel. Furthermore, the masterplan for Legoland Deutschland went on to serve as the template for some of the newer parks developed by Merlin Entertainments. For example, Legoland Malaysia and Legoland Dubai. “It’s a very well defined set of drawings,” says Jakobsen.
When Lego met Merlin
John Jakobsen was serving as general manager of Legoland California when the Legoland Parks business was sold to Merlin Entertainments.
“It was quite a shock for us all in the Lego company at the time,” he says. Perhaps the biggest surprise was because of Merlin’s size back in 2005. After all, this was a company that had cut its teeth running much smaller ‘Midway’ attractions like Sea Life and the Dungeons. It hadn’t even acquired any theme parks at this point. Yet, lead by marketer and ex-Alton Towers man Nick Varney, it understood brands. And Lego was ready to sell.
“Lego had diversified into many different businesses – children’s clothing, watches, games and so on,” notes Jakobsen. “Management was spending a lot of time, energy and money on things that were not necessary yielding a return. We were very impressed with the management at Merlin, in particular, Nick. We realised this was a big opportunity for us to learn from a professional attraction company. It would be a very good match for us.”
For Merlin, it transformed the company. But Lego wasn’t going to let go of the Legoland brand on the cheap. As part of the deal, Kirkbi, the Kristiansen family-owned holding company that controls the Lego Group, took a 29.7 per cent stake in Merlin. Its faith in the burgeoning operator’s future has been repaid handsomely since.
UPDATE: On June 28 it was announced that Kirkbi has partnered with Blackstone and CPPIB to buy Merlin Entertainments for £6bn ($7.6bn).
A resort-first development strategy
The first new Legoland park opened under Merlin was Legoland Florida. Since then all new Legolands have enjoyed resort status either from the outset or had a hotel added soon after. This mirrors the growth of new accommodation across Merlin’s Resort Theme Parks portfolio, including Alton Towers and Gardaland.
“This [accommodation] is certainly something that is considered as part of the masterplan when we are looking for new sites around the world,” says Jakobsen. “However, when we opened the Legoland parks in Windsor and California, we did not have any plans for going into resort development at all. We saw those parks to be solely theme parks, where we would work with adjacent hotels in the local area.”
So what has changed under Merlin? Pedersen explains: “One of the big themes in tourism globally is the shift from longer, set family holidays to more frequent short breaks. Our investments into themed accommodation, which have been led by Legoland, allow our guests to extend their day-long park visit into a multi-day immersive experience.”
Overall, guest satisfaction scores for hotel guests are higher than day visitors. Hotels are also good business for Merlin. In fact, the operator now derives as much as 21 per cent of its revenue from its accommodation. In 2013, it was 13 per cent. Last year, accommodation revenue at Legoland Parks grew nearly 40 per cent. This was a result of 644 new room openings and investment made in Legoland hotels the previous year.
The Legoland hotel portfolio
The Legoland Hotel format now found at six of the international Legoland Resorts debuted at Legoland Windsor in 2017. The claim that it offers the “the ultimate sleepover” is no idle boast given the devotion of many Lego fans. A smoke-breathing Lego dragon greets guests on arrival. Thousands of Lego Minifigures line the reception wall. There are Lego models throughout the hotel and a pirate-themed splash pool outside. Rooms feature themes such as Pirate, Adventure, Kingdom and Lego Friends. Guests enjoy breakfast in the Bricks Restaurant.
The experience wasn’t always so immersive, however, at the original hotel next to Legoland Billund. This was built as an Esso Motel back in the 1960s and later acquired by the Lego Group. Merlin has upgraded and expanded it in recent years. It now offers an experience more in-line with the purpose-built hotels at other Lego parks. The Danish resort also features a variety of holiday village accommodation and, new this spring, a Legoland Castle Hotel.
Since its trial at Legoland Deutschland in 2013, the Castle Hotel concept has also been rolled out to the Windsor and California resorts. The German park also features a variety of themed bungalows and a Pirate Island Hotel. The latter will be duplicated next spring at Legoland Florida.
Lego tourism around the world
The first Legoland Water Park opened at Legoland California in 2010. It features such bespoke Lego experiences as the Imagination Station and Build-A-Raft River. Legoland Water Parks are also located at Legoland Florida, Malaysia and Dubai.
Due to a longstanding co-operation with the nearby Lalandia holiday village, and partly because of the Scandinavian weather, Legoland Billund does not feature a waterpark. Yet since the opening of Lego House down the road in late 2017, Billund now offers diehard Lego fans a selection of Lego experiences unrivalled anywhere else in the world.
‘Lego tourism’ not only takes place in theme parks and Lego House, however. Lego’s own retail outlets are increasingly becoming places of entertainment (or ‘retailtainment’). And Lego shows and exhibitions, official and otherwise, cater to fans of all ages across the globe.
Merlin was keen to exploit the pulling power of the plastic brick to its full potential. It didn’t waste any time in creating a new Lego-focused attraction format. It took over the Legoland Parks business in 2005 and the first Legoland Discovery Centre (LDC) opened two years later in Berlin.
The indoor experience is located at the German capital’s Potsdamer Platz. It sits in Merlin’s Midway Attractions portfolio alongside offerings such as Madame Tussauds, the Dungeons, Little Big City and Sea Life.
Legoland Vs Legoland Discovery Centres
Legoland Discovery Centres are marketed as “the ultimate indoor Lego playground”. There are 23 LDCs around the world. Key components include a 4D cinema, Miniland, ‘factory tour’ and either a dark ride or indoor roller coaster. They also feature multiple Lego play opportunities.
“LDCs are an important format that allows access to the immersive Lego experience in a city centre or mall location,” says Pedersen.
They can also provide operational insight prior to the opening of a full-size Legoland in the same market. “We got a lot of good experiences from Legoland Discovery Centre Tokyo, which opened ahead of the Legoland park in Nagoya,” says Jakobsen. “But it wasn’t a test on whether we should do a Legoland park in Japan or not. Long before we opened the LDC in Tokyo, we were in development discussions about a park in the country.”
Yet while they help extend and create awareness of the Legoland brand, is there not a danger Legoland Discovery Centres confuse the product in the mind of consumers?
“There are some people who will see advertising for Legoland and Legoland Discovery Centres and intrinsically think it’s one and the same thing,” says Jakobsen. “You have parallels in the UK with Tesco [superstores] and Tesco Express [convenience stores]. Over time, people start to understand and appreciate the differences.”
Attraction operator seeks partners, must have local knowledge
As with several of its LDC properties, Merlin is increasingly working with local partners when building new theme park resorts. The company now employs three different park models: owned and operated, operated and leased, and operated under a management contract.
Legoland Dubai is an example of the latter approach. Here the owner is DXB Entertainments. DXB developed the park alongside Motiongate movie park and Bollywood Parks as part of its Dubai Parks and Resorts development. Understandably given the local climate, it features more covered areas than a typical Legoland, including a dome-roofed Miniland.
Merlin invested roughly a third of the capital required for Legoland Japan. Meanwhile, it has a minority stake in Legoland Malaysia, which was built in partnership with Themed Attractions Resorts and Hotels. Local partners, of course, bring local knowledge. The Malaysian company also owns the nearby Puteri Habour indoor theme park, KidZania Singapore and two luxury coastal resorts.
With the opening of Legoland Japan Resort, which debuted in April 2017, Merlin has evolved the format a little further. The park’s entrance area is built over two levels. The upper level houses a restaurant and admin facilities, but the result is a more imposing welcome experience.
A mutually beneficial investment strategy
Merlin will fully own and operate both Legoland New York and Legoland Korea. In the case of the latter, the local government will contribute KRW 80 billion of the total KRW 290 billion (US$245m/€220m) project cost. National, regional and local governments will provide funding for additional infrastructure.
Jakobsen explains the reasons for such financial arrangements: “Legoland parks generate a huge amount of spin-offs for the local area. That can be for the local government, for tourism in the region, for land values around the park. But the very high capital a Legoland park requires will typically not yield a return on its investment in line with Merlin’s requirements. That is why we need to find a mechanic by which some of those benefits generated by the park are transferred back to the entity that receives those benefits.”
The upcoming parks in New York and South Korea are consistent with Merlin’s broader strategy of increasing the proportion of its sales from the growth markets of the US and Asia.
“Both Legoland New York and Legoland Korea will be great additions to the portfolio,” believes Pedersen. “They are both considerable Lego toy markets in their own right, allowing us to leverage the Lego awareness and provide a unique theme park experience in each location.
The rides and attractions found within Legoland parks are now much closer aligned to Lego’s toy ranges than they were a decade or so ago. Those toy ranges are essentially the same in different parts of the world. So often those attractions can be replicated across several parks. This provides economies of scale when it comes to developing new attraction concepts. Ninjago The Ride, for example, was quickly rolled out to all the Legoland parks.
“One of the benefits of the close relationship with Lego,” says Jakobsen, “is the insight it gives us into the direction the brand is taking and what sort of product lines are being planned for the future. That allows us to include those in new attraction concepts early on.”
Legoland’s IP selection
It’s not just toys that inspire Legoland’s rides and attractions. A themed area at Legoland Florida brings the Lego Movie to life.
Home-grown Lego intellectual properties (IP) such as Ninjago and Lego Friends generally give Merlin more freedom in what it can do with them in a theme park environment than say, Star Wars and Harry Potter, both of which have their own Lego toy ranges. Nevertheless, Star Wars exhibits have so far found their way into Minilands in every Legoland park.
If it’s not broke, don’t fix it
One attraction that will be unique to Legoland New York will be the Big Lego Adventure Ride. The dark ride will shrink passengers to the size of a Lego Minifigure. It then takes them on a journey through a life-size Lego world.
This third North American resort is located 60 miles (96km) northwest of New York City. Spanning 150 acres (600,000 sqm), it will feature eight themed lands and a Legoland Hotel.
Construction has already begun on Legoland Korea. The 280,000 sqm resort will be located on Chuncheon’s Hajungdo island and will include a hotel. When it opens in three years’ time, guests will arrive by bridge. The food choices may differ from what they find in Denmark. However, many of the attractions will be familiar to Legoland fans from around the world.
One of the great things about playing with Lego is the potential it gives you to dismantle what you’ve just created and build something new. But the analogies end here. Five decades after Legoland Billund debuted in Denmark, Lego and Merlin aren’t going to start smashing a tried-and-tested theme park formula to pieces.