Project Management / Barbie

Barbie

By Kim S. Nash | Posted 2005-08-04

Mattel's world-class competitive intelligence system crunches sales reports, children's play-pattern studies, and even findings on where kids go online. The system picked up signals that young girls, heavily influenced by the gyrations of pop star Britney

by the Numbers">
Base Case:

Headquarters: 333 Continental Blvd., El Segundo, CA 90245
Phone: (310) 252-2000
Business: Makes and markets toys, including Barbie, Hot Wheels and Fisher-Price products.
Chief Executive Officer: Robert Eckert
Financials in 2004: $5.1 billion in sales; $573 million in profits; net profit margin of 11%.
Challenge: To maintain Barbie's place as the top-selling fashion doll in the world, and a cash cow for Mattel, amid an onslaught of doll challengers.

BASELINE GOALS:

Generate 50% of sales outside the U.S., up from 42% last year.
Cut overhead costs as a percentage of sales to between 17% and 18%, down from 20% last year.
Increase operating margin as a percentage of sales to 20%, up from 14% last year.
Continue to decrease reliance on Wal-Mart, Toys R Us and Target, which combined accounted for 46% of sales last year, down from 50% in 2002, in favor of smaller retailers and online sales.

Story Guide:
How Barbie Lost Her Groove Great product; historical franchise; huge market share; unbelievable customer affinity. And rapidly dropping popularity

The First Tentative Steps: Mattel did see signs of trouble and started to react; but not strongly enough.

A Body at Rest Stays at Rest: Mattel isn't the only company that failed to react quickly, even to clear warning signs.

Barbie's Eye for the Competition: From the beginning, the Barbie franchise was protected by intelligence gathering and analysis, which helped Mattel reinvent her for every generation of girls.

Hard Analysis Gets Answers on Soft Subjects: "Are you ready for this doll?" "Whatever." "Hello, connect me with Design...."

Mattel Upgrades IT to Crunch Better Barbie Numbers: You're not going to predict the future with a white-box desktop and an Excel file.

Recovering From a Bad Relationship: Acquiring The Learning Co. turned out not to be the best move Mattel ever made. CIO: Mattel was in a desperate time when I came on."

Barbie Fights Back: Mattel floods store shelves with new product, sues MCA and makes reviving Barbie its No. 1 corporate goal. Bratz still dominate toy-store shelves.

Barbie by the Numbers: Who's who and what's what at Mattel. Business stats paint a portrait of Barbie's creators.

Operational Details on the Barbie Situation:

Barbie's Heroes: Mattel's intelligence agents, their bosses, and who played what role in the problematic reinvention of Barbie.
Roadblock: CEOs can be the Greatest Obstacle to Success. Mattel's intelligence told it kids wanted hipper Barbies; CEO Robert Eckert and Mattel reacted slowly, and paid the price.
World Class Tool Box: Mattel uses a sophisticated set of data and intelligence tools to steer the Barbie franchise.
Near-Sighted Corporate Intelligence Can Be as Deadly as the Competition. Rival companies with successful toys put Barbie in a tough spot. Politics, social pressures and fashion changes can sink you or—as Japanese car-makers demonstrated—make you a winner.
ACNielsen: Retail Riches. Every day, ACNielsen gathers data associated with millions of retail purchases, from apples in Arizona and Barbies in Boston. It charges a bundle for the results. Is it worth it?

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Senior Writer
Kim_Nash@ziffdavisenterprise.com
Kim has covered the business of technology for 14 years, doing investigative work and writing about legal issues in the industry, including Microsoft Corp.'s antitrust trial. She has won numerous awards and has a B.S. degree in journalism from Boston University.

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