Mattel reinvents itself with bug car and Barbie

Bug Racer is the toymaker's effort to prove that it can be as nimble and tech-focused as its competitors

Mattel reinvents itself with bug car and Barbie
As Gerry Cody, a senior design manager at Mattel, cheerfully loaded a live cricket into the driver’s seat of a new toy car, the cricket probably did not have time to wonder how it had gotten to this point.

Cody explained how the company had consulted an entomologist for the first time in its history to develop a battery-operated racecar with a compartment for a cricket, whose movements “drive” the car — sometimes into walls and chairs.

Mattel may be more closely associated with Barbies than bugs, but the racecar fits into Mattel’s efforts to prove that it can be as nimble and tech-focused as its competitors. After years of sagging sales, executives trot out the Bug Racer as one of the quirkier signs that the 70-year-old company is no longer your grandmother’s toymaker.

“That’s a really good example of something that you feel like you’re taking a little bit of a risk,” said Susie Lecker, executive vice president and chief brand officer of Toy Box, a new division of Mattel that developed the Bug Racer as part of its mandate to fast-track promising, experimental products. “That’s where I’m most comfortable, where it’s not the sure thing.”

Toy Box’s 400-some employees represent just a fraction of Mattel’s 31,000-person workforce, but the manufacturer is relying on the unit for some of the most technologically ambitious projects, including two of its more prominent items this holiday season: the interactive talking Hello Barbie doll and View-Master, a decades-old 3-D brand that Mattel reimagined as virtual reality goggles.

“It may be a bit smaller, but it’s the engine that we’re counting on,” Christopher A Sinclair, Mattel’s chief executive, said in an interview at the company’s headquarters in El Segundo, California.

Sinclair took over after the abrupt resignation of his predecessor, Bryan G Stockton, in January last year. He quickly started mending fences with Disney, which had dropped Mattel as a partner for its Disney Princess dolls, one of its most lucrative licensing deals. And he built bridges to outside toy inventors in search of fresh ideas because, Sinclair said, the company had become too “insular.”

“Disney was obviously, you know, a huge blow a year ago, but in many respects, we did it to ourselves,” Sinclair said, blaming Mattel for, in part, offering toys that competed with Disney Princess products.

“But it wasn’t just Disney,” he said. “We had to go back to Universal and Warner and all the other folks we do business with and reboot, if you will, the Mattel way of doing things.”

Toys tied to movies and television shows are a huge part of Toy Box’s mandate, as Mattel looks to rev up its licensing business. That includes coming toys for well-known characters like the Teenage Mutant Ninja Turtles and new shows like Netflix’s “Dinotrux.”
Although the hole left by Disney Princess may be enormous, Mattel has the rights to a number of other lucrative entertainment properties: Disney’s next “Toy Story” film, several of DC Comics’ female superheroes and the coming “Batman v. Superman: Dawn of Justice” movie. Sinclair is also confident in Mattel’s chances of winning the rights to Disney’s third installment of “Cars.”

Investors have nevertheless expressed concerns about the company’s core business. That business includes Barbie and Fisher-Price, staples that have struggled in recent years to find a mainstream following. Last year, sales of Barbie to retailers declined 16 per cent and Fisher-Price sales fell 13 per cent. This year, though, there were positive signs, including an increase in consumer sales in stores.

The task of revamping Barbie has largely fal-len to Richard Dickson, who returned to Mattel in 2014 after spending several years as a top clothing company executive and now serves as Mattel’s president and chief operating officer.

More apt to wear a vintage watch than a Timex, Dickson — a native New Yorker whose parents worked in retailing and fashion — has long straddled the worlds of consumer products and style. His office has a row of Barbies wearing what look like colourful fur coats, as if they were gearing up for a catwalk in the arctic. A framed black T-shirt that reads “The Same is Lame” leans against a wall.

Demonstrating Barbie’s relevance today has meant balancing goals that seem at odds with one another: Remain true to the doll’s roots, while avoiding the impression that she stands for a particular brand of beach-blonde body dys-morphia. Barbie, as Dickson says, is “really about imaginative play, and not about body image.”

Barbie’s makeover has meant new products—a Fashionistas line with a broad assortment of skin tones, eye colour and facial structures, and a Zendaya doll in the image of Zendaya Coleman, the Disney Channel star — but also a more streamlined marketing operation that plays up Barbie’s progressive side.

A commercial for Moschino Barbie, for example, featured a boy playing with a Barbie probably for the first time in the company’s history. Another ad features little girls who “imagine the possibilities” after playing with Barbie — veterinarian, teacher, businesswoman — and has garnered nearly 20 million views online.
The ads are a 180-degree turn from some of the less-empowering messages of Barbie’s past, like the talking Barbie who complained how “Math class is tough.” But Dickson understands that making Barbie relevant does not just mean making her talk. She must also be part of the conversation. “Pop-culturally, we’re getting Barbie back on the right track,” Dickson said.
Hello Barbie
Ad spending has declined in dollar value this year, but it has increased sharply as a percentage of overall sales, according to Sean McGowan, an analyst with Oppenheimer & Co. “I think the message from this is that they went through a period where they thought they could get away with cutting the advertising.”
Then there’s the $75 Hello Barbie, the WiFi-connected doll Mattel is promoting as one of the brand’s most innovative products in years. Speech recognition technology allows Hello Barbie to discuss potential career ambitions, ask for advice or have other interactive conversations using more than 8,000 phrases. It hit store shelves in time for the Christmas season, but Mattel is still relying on a number of more traditional Barbie dolls and play sets, like the Barbie Dreamhouse and the Rock ’n Royals line.

“Hello Barbie is their prototype car,” said Jim Silver, editor of TTPM, a toy review website. Hello Barbie, he said, is about proving what Mattel is capable of. “It’s to show that they’re doing cool things with the brand.”

Produced in collaboration with the San Francisco-based company ToyTalk, Hello Barbie is also an example of how Mattel wants to revive its relationships with outside inventors. Toy Box’s options have about doubled since the division started in 2014.

“Within a month, we had an option on the Bug Racer, which is very fast,” said Robert Schwartzman, president of Pace Development Group, who created the idea with his business partner, Peter Williams.

The pair did not even think of taking their idea to Mattel when they met with company representatives last year. “We were thinking, ‘Mattel doesn’t make cool toys,’” Schwartzman said. “‘They make beautiful toys and fun toys, but they don’t make edgy toys.’”

But after members of Toy Box described how they were looking to speed up the production of products that were more on the edge, Schwartzman pulled out a video on his iPad, and explained how sensors could steer the car based on an insect’s movements. The Bug Racer was on shelves within the year.

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