Lego lays building blocks for Asian dominance

Lego is making global domination look like child's play, as the world's biggest toy-maker puts the building blocks in place to lead rivals in Asia and buck an industry-wide revenue dip.

The Danish toys juggernaut overtook Mattel in the first half of the year.

That was partly thanks to the runaway success of "The Lego Movie", which sent children scrambling for the coloured bricks, and partly because parents fell out of love with Mattel's Barbie, seen by some as promoting an unhealthy body image and outdated gender roles.

All in all, Lego seems to be having fun.

"They've done something similar to what Apple has done, which is known as transcending a category," said Niels Lunde, author of "The Miracle at Lego", a Danish book about the company.

"They don't just make toys, they make the stuff toys are made of. A Lego brick is not just a toy, it's an educational material that stimulates children's creativity," he added.

The children's market isn't always an easy game.

More traditional toy sales face competition from an onslaught of video games and smartphone apps—many of which are free— leaving industry giants such as Hasbro and Mattel scrambling to come up with a digital strategy.

Lego, arguably, has gone the other way.

In the 1990s, "they feared this primitive brick of plastic couldn't withstand the competition from the digital world," Lunde said.

They tried branching out into everything from video games to children's fashion, but this brought the group to the brink of bankruptcy, and in 2004 Lego heir Kjeld Kirk Kristiansen was forced to inject 800 million kroner ($135 million) of his own money.

Incoming chief executive Joergen Vig Knudstorp brought the company back to basics—bricks—but with the twist of earning licensing fees on things like Legoland theme parks, which were spun off and merged with Merlin Entertainment.

"Their turnaround came when they understood that this plastic brick is really a brilliant toy material," Lunde said.

By the first half of this year revenue had more than tripled since 2008. "It is a very satisfactory result that shows our significant growth in recent years in a tough economic environment," Knudstorp said in a statement.

In August the company launched Lego Fusion, which blends real-world building with a smartphone app that interacts with the constructed models.

An online game launched in 2010, Lego Universe, also attempted to bring the real bricks into the digital era but flopped.

Still, the Internet is already changing how people play with Lego -- it is one of the top three brands on YouTube, where fans enjoy posting video clips of their own, unique creations.