Goodbye Golden Rule (no more 10¢ per brick average)

[Solo]

I've been looking at all the new sets in Ace's gallery, and while they look great the prices seem a bit on the high side. Sets have shifted south of the long standing "golden rule" of LEGO - meaning that most of the time sets would average around 10¢ per part. The easy way to approximate it was shift the piece count on the box over a decimal to get the rough price. If that matched up to the set's true price, or was higher, it was a deal. If it was lower, well, not so much of a deal. This has worked out as a sort of standard for a long time now, and only recently has it been consistently slipping.

Here's a glimpse into late this year:
Star Wars:
- 10195 Republic Dropship with AT-OT Walker, 1,758 pcs, $249.99 USD = 14.22 ¢/b
- 8039 Venator-Class Republic Attack Cruiser - 1,170 pcs, $119.99 USD = 10.25 ¢/b
- 7749 Echo Base - 155 pcs, $24.99 USD = 16.12 ¢/b
- 8038 Battle of Endor - 890 pcs, $99.99 USD = 11.23 ¢/b
- 8036 Separatist Shuttle - 259 pcs, $29.99 USD = 11.60 ¢/b
- 7748 Corporate Alliance Tank Droid - 216 pcs, $24.99 USD = 11.57 ¢/b
Power Miners:
- 8964 Titanium Command Rig - 706 pcs, $99.99 USD = 14.16 ¢/b
- 8963 Rock Wrecker - 225 pcs, $34.99 USD = 15.55 ¢/b
- 8962 Crystal King - 168 pcs, $19.99 USD = 11.90 ¢/b
Space Police:
- 5973 Hyperspeed Pursuit - 456 pcs, $49.99 USD = 10.96 ¢/b
- 5974 Galactic Enforcer - 825 pcs, $99.99 USD = 12.12 ¢/n
- 5972 Container Heist - 282 pcs, $29.99 USD = 10.63 ¢/b
- 5971 Gold Heist - 205 pcs, $19.99 USD = 9.75 ¢/b

Now, this is only a few sets and lines I'm interested in of course, and it's not all of them even... but as a test group it works. Space Police is about what we're used to, averaging just over the 10 ¢/b mark... but PowerMiners is really stepping over (Thanks to the new large rock monsters I assume). Star Wars is almost as bad: a few sets are holding the current trend, but others push it beyond. I understand the high cost for the Taun Tauns so I can forgive that bleak 16.12 ¢/b for Hoth, but nothing about the ATOT and Drop Ship seems to justify such a difference - aside from it's size and exclusivity. In comparison, the UCS Falcon managed a 9.62 ¢/b ratio, and the Death Star was just 10.51. And they had exclusive figures added in... this seems to just have a couple battle packs worth.

Keeping in mind what Steve has mentioned elsewhere about last years oil prices impacting this years set prices, it all paints a pretty clear picture. We're in for a pricey year, and I'd wager it'll stick around beyond '09 even with gas prices easing off a bit (since we all know that's not the only factor in set prices, and the economy isn't all that pleasant right now).

My question to you is have you noticed this too, and will the upped prices effect your buying habits very much? Or maybe you think I'm exaggerating things, since sets like Creator and Town still work out to better ratios? Personally, I've always been the sort to wait for sales... so I probably won't be buying any less that I have been. It just sucks to realize that the times are a changin.

[Solo]

Aaaand Iare just pointed out that I did everything backwards. /facepalm

Give me a minute and I'll clear things up.

Edit: OK, taken care of. I had it so the ratios were bricks per dollar, which didn't make a whole lot of sense considering I thought I had cents per brick on the mind. All's good now. Fore reference, 10-11 is what we're used to paying (so far as I remember), higher than 12.5 is too much for an average unless there's a lot of good figures or exclusive molds, and anything under 10 is a relative steal at MSRP and even better on sale.

[Ham Salad]

Being in Oz the exchange rate is a killer with a US $99 set being $150 or more, I did a quick calculation of the Drop Ship and Walker set which has gone to the top of must buys for the year and it is looking like $370 add postage and its over $400. These sets are awesome, but I wonder if Lego is just pricing themselves out of the market down here.

If I understand what Solo is doing (tell me if I am wrong) this works out at 21c per brick. I not sure if that is right.

I don't know if I can really justify spending that amount of money on one set no matter how gorram good it is, especially at the moment in these hard recessionary times. If someone can give us from downunder a heads up when there are sales on @ shop@home it would be app

[Solo]

At $400 USD that works out to a 22.75 ¢/b set... everyone overseas usually gets the proverbial short end of the stick, and this is no exception. One can only hope they'll get you a sale or something to make it a bit more reasonable, and if they do we will be sure to post it.

[yankeeken]

Its a bit depressing to see the 10¢ rule disappear, however I guess its just another of the unfortunate effects of rising gas prices and a sinking American economy. Anyway I must say, that the rising prices has greatly affected my LEGO purchasing. Aside from Battlepacks, 7676 Republic Attack Gunship has been the only LEGO Star Wars set that I have bought since 2007. I admit that part of this is due to my general distaste of The Clone Wars minifigs and my natural preference towards the Original Trilogy sets, yet the current prices have also had some effect on my decision to buy less LEGO.

[Hunter]

I WAS going to say that while it's sad that we seem to be losing the 10 cent per brick average (for the US), maybe we'd been a bit spoiled for a while. For some reason, my memory of lego prices from the 80's and early 90's (not that I had any real conception of pricing back then, or had the ability as a 10 year old to appreciate the nuances of international pricing) but a quick scope of Peeron and some old MSRP prices has led me to realize that I was wrong, and even the older sets followed the golden rule.

I"m not going to get into my feelings regarding the US vs. CDN pricing, as it has been hashed over at least 1000 times on the old forums. I will say that it is frustrating to see prices everywhere go up, but as producers in bleak economic times TLG probably does it in an effort to soften their own loses, rather than some scheme to "rip off" consumers.

Lego has always been an expensive toy. That's not an excuse for prices to keep climbing higher, but just a simple statement of fact. I hope that rising prices don't disuade more parents from buying, as I hate to see the influence of electronic toys on the toy market, and would like kids of today to playing with things that encourage their imagination.

[TheThrasher]

A thing that hurts LEGO with having high prices are the competitor brands. LEGO needs to make sets a little higher to pay off the cost for making them, especially sets that call for new molds. When parents see a space theme 50$ LEGO set and a space themed 20$ Megablock set with the same amount of pieces, which do you think they will buy? Sure, some parents do know whats good quality and whats bad, but alot don't. They're going to get the cheaper toy, because their little kid wont know the difference, and LEGO's cometitors know this. Megablocks probally knows that their toys are low quality compared to LEGO, but they also know they are cheaper, and in this economy, cheap > quality. LEGO is stuck. They need to raise prices to make up for manufacturing costs, but when prices get larger, people turn to the cheap, knockoff brand. So the money they spend for the new molds isn't made up because the price is to large, and people aren't buying the product. So if they try and lower prices, money might not get made up for the large manufacturing cost. Sure it probally doesn't work exactly like this, but LEGO is in a tight spot right now.

[Draykov]

My question to you is have you noticed this too, and will the upped prices effect your buying habits very much? Or maybe you think I'm exaggerating things, since sets like Creator and Town still work out to better ratios? Personally, I've always been the sort to wait for sales... so I probably won't be buying any less that I have been. It just sucks to realize that the times are a changin.

I've definitely noticed. While City sets may be more comparable to old price points on the whole, LEGO has been slipping in the occasional "gold plated on the inside" variants of things like the mail plane and the little red tractor to compensate. I'm just happy the new space stuff isn't ridiculously priced, what with all the new molds.

Fortunately for me, my will power is embiggening or I just really don't care about Clone Wars (in terms of LEGO product - I find the show pretty watchable at times). I think it's the figs that are the real deal-breaker for me. The only reason I have as many as I do is because Amazon was dropping them at ridiculous prices prior to Christmas..."Gunship for $67? Sure, what the hell." Since SW has been the theme I concentrate on most, this eases the pain a bit. While I have to (have to) buy things like the new Home One/Echo Base/Endor sets, I can pass on a $250 AT-OT with LAAT/c and still sleep pretty well at night. Of course, there's still the half dozen other themes churning out cool stuff like nobody's business. But I'm definitely starting to feel like we're hitting a market saturation point. I can no longer afford to buy every set I think I might want. That's gone from impractical to ridiculously impractical.

[MrCRskater]

I've definitely noticed, too. Certainly Steve's explanation regarding fuel prices is true and has had a bearing on the prices. However, I wonder if it has something to do with the licensing? The sets that are really spiking as a trend are those in the house that George built (i.e. Star Wars and Indy). Many of the sets in LEGO original lines (Space Police, Racers, Creator, City, etc.) are hanging close to the 10-cent rule.

"BUT NOT ALL! What about the high prices of the new Power Miners sets and some of the Castle sets and the Pirates sets?! It's not the licensing! "

I still think it's the licensing. As Don pointed out, the high price of some Power Miners probably has something to do with the rock monster pieces. In fact, the whole Power Miners line looks more like Tonka trucks than Lego kits, so I'm sure they're spending a lot more in terms of both new pieces and bigger pieces (more plastic). And those rock monsters, like the Ogres in the Castle line, are more like action figures than minifigures, so they're costing more to produce. As for Pirates, well. . . I guess I still can't quite explain that one.

[Solo]

That last bit has nothing to do with licensing... it's just developments costs and the large molds in the sets. Town doesn't need a whole lot of new elements, they just re-use new ones developed for other lines in new colors. But PM gets these big drill wheels, increasingly detailed rock monsters, dynamite, and all sorts of interesting play features worked in to boot. Its understandable for that to be as pricey.

[MrCRskater]

Sorry, I didn't make myself clear. I was saying that I think the trend towards higher price points in the Lucas lines is due to licensing. But I agree with you, Don, that the higher prices of Power Miners has to do with all those monster pieces, like the wheels and drills.

[Daz Hoo]

I think that gas prices played a factor in the general increase in prices for sets, but I think the fact that the USD value has dropped significantly in the last few years (compared to other currencies) has played a major role in the price increase in the US.

Back when the CND was at par with the USD, we, Canadians, were complaining that US prices and Canadian prices didn't reflect the current value of both currencies. One explanation that Steve and other LEGO representatives gave us was that the Canadian dollar wasn't gaining value, but that it was the USD that was loosing strenght on international markets. A few even suggested that US prices were probably going to be increased to compensate that.

I think that the increase in the price per piece ratio of sets sold in the US for 2009 is just a reflection of this new reality.

[Teekay]

New golden rule suggestion: $0.12 per piece. For a new era.

~Sam (Teekay)

[Prince Kahuka]

When parents see a space theme 50$ LEGO set and a space themed 20$ Megablock set with the same amount of pieces, which do you think they will buy? Sure, some parents do know whats good quality and whats bad, but alot don't.

While this makes perfect sense, my casual observations haven't shown this to be true. Whether it's kids looking by themselves, with their parents, or parents looking by themselves, people in my metropolis definitely know what is and isn't LEGO and I only see them looking at the LEGO. Kids are pretty acute as to whether their toy is the "cool" brand or not, and they probably also see enough LEGO commercials on TV or see what their friends have to know what lines they want to buy or ask for. The only time I've personally seen people pick up MB is to buy those huge bricks meant for toddlers. Just my 2¢.

Uda

[Logan]

I know this is a bit of an oversimplification, but general inflation takes a toll as well.

$3+ per gallon for milk?? Jeez, I have a hard time finding bread under $2.00 a loaf these days.

The fact that we can actually generally find the average to be between $0.10 and $0.15 shows me that the company still strives to keep the consumer in mind, which has been discussed and analyzed a ton of times when talking about how sets are designed and the factors that go into the process. Steve has also given a lot of answers in regard to ways that streamlining the creation process (such as the mold designs and updates made) saves the company money, which does (especially in a receding economy) trickle down to the consumer.

Let's face it.. if the only choices we had right now were food or LEGO, the company would go out of business. But considering that we all use some of our expendable income (or our parents for those of you who still can.. ) on LEGO products, it's fair to say that the quality and price of the product we get has remained fairly consistent over the course of the past 20 years... of course, using general inflation as a barometer.

Now, I'm not an economist at all... just trying to apply some of my thoughts to the discussion.