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PGDM SEMESTER II STRATEGIC MANAGEMENT CONCEPTS PROJECT NO. 03 STORY OF BARBIE’S ‘SUCCESS’ Total words - 4594 GROUP NO. 01
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PGDM SEMESTER IISTRATEGIC MANAGEMENT CONCEPTS

PROJECT NO. 03

STORY OF BARBIE’S ‘SUCCESS’

SUBMITTED TO SUBMITTED BYResp. Prof. Sham Sharma Abhinav SharmaM.A.(Lucknow) Amit Baliyan

Total words -4594

GROUP NO. 01

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D.M.M.(London) Amit Prabhakar Faculty IPM Amit Kumar Amit Sharma Anjani Kumari

INSTITUTE OF PRODUCTIVITY & MANAGEMANT, MEERUT

CONTENTS

1. Acknowledgment 3

2. Introduction 4

3. Executive summery 6

4. SWOT ANALYSIS 7

5. QUESTION 1. 9

6. QUESTION 2. 11

7. QUESTION 3. 18

8. CONCLUSION 20

9. BIBLIOGRAPHY 21

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ACKNOWLEDGEMENT

"Work is Worship"- so goes the old adage, Herculean task have been overheard by dedicated and concerted effort of various people who have sensibly and systematically blended their thoughts. We acknowledge deep sense of gratitude towards our guide, Prof. Sham Sharma for giving us time and support. We would like to extend our thanks to all the people who have directly or indirectly contributed to this assignment.

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Introduction of Barbie doll

In this case study we find that there is doll named Barbie, which is first introduce in 1950, when Ruth Handler, one of the founder of Mattel Co, asked Mattel’s designers to design an adult looking doll for children. In 1955 we can get that it was the starting of innovative idea to make this doll by Ruth when he was on vacation with his family. So after some time in 1959, Barbie first introduce in American in a toy fair, the first Barbie was introduce in black strip swim wear, which was not acceptable by the mothers, because they thought that it would leave a bad effect on their children. After the entire first Barbie sold in the first year351, 000 units.

If we talk about the building up an image then we find that Barbie fashion were based on the philosophy that the doll sells the clothes and the clothes sales the doll so the company also add some other gadget we find continues changing in Barbie model as in the 1961 Barbie got new bright blue eyes and so on. In the continuous series of Barbie we find Barbie little sister in 1964, Barbie was touching sky limit in selling. In the 1980 Barbie represent the disco culture along with ken and her friends Denney and Marie, and in 1988 happy holidays Barbie doll exhibit and the process of changes in Barbie is continue, again in 1990s Mattel’s realized that Barbie needed to became techno savvy. In 1996, Mattel launched Barbie fashion design, a CD- Rom, according to the survey it become the fourth best selling game for that year with the sales of around 353,409 copies with in the first three months of its launch. By 1995 Barbie has presented 90% of the US market and 2.5 dolls were sold every second. According to company sources, by 2002, more than 1 billion Barbie Dolls were sold worldwide.

If we talk about the Barbie’s image according to the case study the awe find that one of the reason for Barbie success was its adaptability to changing trends. It was reported that Barbie had more than 80 careers within a period of 40 years. The doll had played the role of college graduate, doctor, teacher, astronaut, presidential candidate, surgeon and business executive, among others.

If according to case study if talk about the overhauling the image, so along with the change in image, Mattel changed the packaging of Barbie dolls. Till late 1999, Barbie was packaged in a bright pink box, which did not have the usual rectangular shapes. The name of the doll was prominently displayed on the packaged, along with graphics and the Barbie logo. In 1999, Barbie boxes were redesigned, featuring the new logo. Barbie was written in big letters while the name of the doll

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was written in small letters after the logo. The earlier bright pink color was replaced by a new light pink color. In this segment in 2000, Mattel also launched JEWEL GIRL BARBIE, which was able to move in more realistic way.

In those days we cannot say that Barbie is the only player in the market, there was the lots of other players which were playing a great inning against the Barbie. Barbie not only had to deal with changing treads in children’s taste, it also had to deal with stiff competition from the Disney Princess launched in 2001.

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EXECUTIVE SUMMARY

The Barbie doll was invented in 1959 by Ruth Handler (co-founder of Mattel), whose own daughter was called Barbara. Barbie was introduced to the world at the American Toy Fair in New York City. The doll was intended to be a teenage fashion doll. There has been some controversy over Barbie's figure when it realized that if Barbie was a real person her measurements would be an impossible 36-18-38. The Ken doll was named after Ruth's son. Barbie first had bendable legs in 1965.

Mattel Barbie dolls first hit stores in 1959. They were made of a flesh-toned plastic vinyl and were 11 ½" tall. The very first Barbie had a moveable head, arms and legs and was dressed in a black and white swimsuit, sunglasses and gold circle earrings. Her hair was a soft silky saran material. She was either a light-colored or dark with a ponytail. The first dolls, now very rare and valuable, were numbered 850 in the box.

The second and third Barbie dolls were produced in 1960. The second dolls were exactly like the first ones except they did not have holes in their feet and wore pearl earrings.

The third doll had blue eyes and curved eyebrows. Some of the dolls had blue eyeliner and others brown eyeliner.

Because of the vinyl the first three dolls were made of, today the dolls have turned a pale white color.

In late 1960 a new Barbie doll was produced with a different type of plastic. These are considered the fourth type of Barbie dolls and the only difference from the third is that their bodies kept the coffee color.

A Barbie doll is one of the famous cultural icons in America. Numerically, there are 2.5 Barbie’s for every household in America. Barbie doll beckons the young Americans girls: big and small, toward a money-oriented world, where there is beauty but without emotion or brain. Barbie is a representation of the adult woman in the United States or it is the representation of how a woman should be. Barbie doll influencing and reinforcing an impossible cultural norm of physical beauty.

SWOT ANALYSIS

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STRENGTHS

(1) One of the most important strength with Barbie was that it was a 41 year old brand and the brand remains very popular with customers.

(2) Mattel has merged with number of other established brands

such as fisher brand and in addition to diversifying Mattel’s product line, working with the successful and popular names increased chances for success.

(3) Mattel’s new management has helped to turn companies’ former weakness into strength by making strategy and generating innovative ideas.

(4) Mattel has been considerably successful venturing into international markets in recent years.

WEAKNESS

(1) Mattel company has changed the fabrics of Barbie doll which criticized by the people. Some even accused Barbie of encouraging girls to visualize themselves as sex objects. And it creates an unfavorable image in the minds of buyer.

(2) One frequently occurring mistake is that of unprofitable

mergers and acquisitions.

OPPORTUNITY

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(1) The AMERICAN toy market is becoming increasingly saturated and competitive, where children moreover love interactive toys and technological products. This makes little opportunity domestically for Mattel if they continue with the same product line.

(2) The more opportunity exists in Mattel’s new primary focus

on international markets. Barbie has become an extremely recognizable brand worldwide and has been selling very well in the markets.

THREAT

(1) The main threat is that there is a systematic movement away from tangible toys. Children are getting access to various forms of entertainment such as video games and computers.

(2) Barbie’s not only threat with the changing trends of children but there is also another thing i.e. stiff competition from the Disney princess launched in 2001.and also Disney dolls were rapidly becoming popular.

Question 1.

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Analyst observed that the Barbie, the main icon of American culture, reflected changes in American society. Analyze the changes in Barbie’s image over the years.

Answer.

Barbie was considered an icon of American culture across the world and a representation of the richness and luxurious lifestyle of the Americans. She was also regarded as a role model who inspired young girls to become independent and self independent.

Analyst attributed Barbie’s success to its ever changing styles and its adaptability to changing trends in American society. Barbie faced a lot of criticism for allegedly sending wrong messages to young girls. Sometimes Barbie also faces many criticisms. Sometimes it was criticized for a sex symbol. Some even accused Barbie of encouraging girls to visualize themselves as sex objects.

One of the main reasons for Barbie’s success was its adaptability to changing trends. It was reported that Barbie had more than 80 careers within a period of 40 years. The doll had played a role of college graduate, doctor, teacher, astronaut, presidential candidate, surgeon and business executive among others. Mattel realized that to suit the changing times, Barbie needed to look more assertive. In 1971, Mattel introduced” Live Action Barbie” to portray the liberated woman. Live Action Barbie had a trimmer figure than earlier Barbie’s. In 1974 Mattel introduced “Sweet Sixteen” Barbie. This Barbie was not glamorous as teenager during that period opted for less makeup and long hair. In 1975 for the winter Olympics a new athlete Barbie was launched. The athlete Barbie had the clothes and accessories of a swimmer, skater and a skier. With a new version, Barbie’s faces also have new changes. In 1975 she got a warm grin and by 1977 she had a permanent smile. In the 1980s Barbie came with wide smile and winged hair. By the mid 1980s, the American woman adopting different careers, Mattel wanted to change the Barbie’s image to boost up the sales. That time young girls were becoming career oriented. So, Barbie was launched as an astronaut in 1986 and as a doctor in 1988.In 1985 Mattel introduced” Day to Night Barbie”, which represents the busy lifestyle of working women. Mattel also renew the image of Barbie as a fashion doll by introducing crystal Barbie, Puerto Rican Barbie and great shape Barbie. To support Barbie’s new image, Mattel launched a new ad campaign “We girls can do anything” in 1980s. The whole ad conveyed the idea that young girls could do anything they wanted. In 1992, Mattel launched “Presidential Candidate Barbie”, inspiring young

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girls to opt for a career in politics. In 1998 Mattel launched Barbie’s website barbie.com. In 1990s Barbie had a decrease in sales due to increase in alternative means of entertainment for kids such as video games, computer games and the internet. Also kids could not relate to Barbie due to changing priorities and analyst also observed that in the 1990s, young girls became more career minded and techno savvy and they failed to relate Barbie. In 1997 JILL BARAD became a CEO of Mattel and also she announced to make Barbie’s image more consistent with the image of women in 1990s. In 1997 Barbie’s first classical ballet series, sugar plum fairy was launched. In this series Barbie was launched under seven world famous ballet series. Due to decrease in sales of various reasons, in 1998 Mattel redesigned Barbie. Barbie was launched with slimmer hips, a wider waist and smaller breasts and this new Barbie reflected society in the late 1990s. To support the image overhaul of Barbie, Mattel launched ‘Be anything ‘campaign in 1999. This advertisement showed that girls start in to the camera with untamed hair and a confident look, holding a hockey stick behind her head. In 1990s Mattel celebrated 40th birthday. And this birthday celebrations, Mattel introduced successful women who like Barbie doll taught little girls that could do any things.

So, Barbie’s image was changed various times according to American culture which wants to relate with the society and launched various dolls to attract the children and various buyers.

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QUESTION 2.

Analysts attributed Barbie’s success to the Mattel’s innovative product development. They pointed out that Mattel’s product development reflected changing cultural patterns in American society. Analyze the role played by product development in Barbie’s success.

Answer.

IntroductionIn order to analyze about the success of Barbie dolls there is a need to understand first about few concepts. Also there is a need to understand that how was the cultural setup of the American society since the inception of the manufacturing of the Barbie Dolls.

Let’s first start with;

What is Ansoff grid?

Ansoff grid

The Ansoff product/ market matrix is a tool that helps businesses decides their product and market growth strategy. Ansoff's product/ market matrix suggests that a business' attempts to grow depend on

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whether it markets new or existing products in new or existing markets.

It is used by marketers who have objectives for growth. Igor Ansoff's matrix offers strategic choices to achieve the objectives. There are four main categories for selection.

Market Penetration Market Development Product Development Business Diversification

The four main categories

Market Penetration (existing markets, existing products): Here we market our existing products to our existing customers. This means increasing our revenue by, for example, promoting the product, repositioning the brand, and so on. However, the product is not altered and we do not seek any new customers.

Market Development (new markets, existing products): Here we market our existing product range in a new market. This means that the product remains the same, but it is marketed to a new audience. Exporting the product, or marketing it in a new region, is examples of market development.

Business Diversification (new markets, new products):This is where we market completely new products to new customers. There are two types of diversification, namely related and unrelated diversification. Related diversification means that we remain in a market or industry with which we are familiar.

Product Development (existing markets, new products):

This is a new product to be marketed to our existing customers. Here we develop and innovate new product offerings to replace existing ones. Such products are then marketed to our existing customers. This often happens with the auto markets where existing models are updated or replaced and then marketed to existing customers.

After understanding what product development is, it is now important to understand that how was American culture, American society in

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particular, since the birth of the Barbie dolls and how has been the product development of Barbie throughout these time.American society and contemporary product development of Barbie dolls:

Barbie was considered an icon of American culture across the world and a representation of the flamboyance and luxurious lifestyle of the American. She was also regarded as the role model of the young girls who inspired to become independent.

Barbie was the world’s largest selling toy and one of the most successful products of Mattel Co., its manufacturer. Barbie’s ever –changing styles and its adaptability to changing trends in American society was the reason behind its success in the world.

In 2000s, various forms of entertainment such as video games and computers came which attract the young generation towards themselves and decrease the no. of child playing with the dolls.

In 2001 Barbie faced stiff competition from ‘Disney Princess’ launched by Disney.

The toy market in the late 50’s and 60’s

Barbie was not a success at first. During and after the New York Toy Show its sales were yet to be what Mattel expected. When Barbie was conceived and launched, the doll segment of the toy market was dominated by Ginny, a doll made of hard plastic by Vogue Dolls, Inc. and by Miss Revlon, produced by Ideal Toy & Novelty Corporation. In order to deal with those two strong

competitors, and with the issue of the adult look, Mattel commissioned for $12,000 a toy study by Ernest Ditcher, the motivational psychologist of 1950s marketing. The study and the observation on the children and their parents helped to establish the guidelines for the advertising campaign that would launch Barbie in the retail market. Toys were shown in commercials making it possible for children to determine exactly what they wanted. Using the guidelines determined by Ditcher's study, this was how Mattel reached its public. By the end of 1960, Barbie's popularity was well established, and the orders started to grow. It took Mattel several years to catch up with the demand.

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Shaping strategy trough design: 70’s and 80’s

In the late 1960s Mattel added new features to Barbie to sustain the interest of young girls in the doll. In 1966, Barbie accessories included a magic solution that would change the color of Barbie’s hair and clothes which was fashionable among the American teenagers. In 1967, Mattel revolutionized the toy industry when it introduced” Twist and Turn “Consistent contribution to Barbie’s success in the 5-12year-old girls market has been Mattel's capability in using design strategically. As described before, since Barbie's creation, design

has been taken seriously and done by a complementary team. From the moment the first Barbie was launched, the product design group started to redesign the doll in order to cut costs, solve production problems and adjust it to market exigencies. Since the beginning, manufacturing expertise has contributed to product development together with early design. This has allowed Mattel to be always one step ahead of manufacturing in the race to the end of product cycle. Mattel's approach to design in the early 1970s was very close to the most advanced techniques and methodologies used today. The use of design in various specialties gave Mattel the opportunity to build a design culture that would support product development in the years to come. Since the beginning Mattel invested in designing and redesigning Barbie based on changing role models. This tendency proved to be definitively successful once it became possible to have the "role model of the moment" translated into a Barbie doll.

On Design and Redesign

Elliot Handler, Mattel's co-founder, was a man with an eye toward the future, especially where new materials were concerned. He invested in new materials and technologies to give Barbie different features, offering varied and compelling experiences to the users. With a user-centered approach to product development, Mattel's designers anticipated children's wants, creating unexpected possibilities in the Barbie world.

Barbie's face has been redesigned several times in order to keep up with current fashions in make-up and hair styling and to adapt the doll to an ever-changing market. During this time, Barbie's body has not changed in proportions but it has endured several changes in the design of joints, molds and moving parts according to new production techniques and materials.

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The 90’s and the second breakthrough

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On fashion, lifestyle and design

Based on this strategic thinking, Mattel invested heavily in product and fashion design throughout the '70s and '80s. As a result, Mattel fashion designers, led by Charlotte Johnson, created special collections for the doll year after year. In the mid 1980,s the change in the image of the Barbie changes according to the current scenario of the America. In the mid 1980s the image of Barbie was mostly career oriented, like in 1986 launched as an astronaut and in 1988 as a doctor. In 1985, Mattel introduced “Day to Night Barbie,” representing the busy lifestyle of working women. It is important to stress that they designed not doll clothes, but true miniature fashions. Besides designing outfits, fashion designers over the years also created an enormous amount of miniature accessories - jewelry, gloves, shoes and purses, which have populated Barbie's world of consumer goods since the introduction of the first models. Packages of clothes and accessories without the doll were a part of the first Marketing strategy that grew tremendously in the ‘70s and ‘80s, and which still persists today.

After 1990s

Because of increasing alternative mean of entertainment for, kids such as videos games, computer games and the internet that decrease the market growth rate of Barbie doll after 1997. In 1998, Mattel redesigned Barbie. According to Mattel sources, the new Barbie reflected society in the late 1990s.

To support the image overhaul of Barbie, Mattel launched the ‘Be Anything’ campaign in 1999. In the same year, Mattel celebrated

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Barbie’s 40th birthday. During its birthday celebration, Mattel introduced Barbie as “Ambassadors of Dreams”. Barbie doll taught little girls that they could do anything.

In 1999, to improve Barbie’s sales, Mattel adopted two strategies. The first strategy involved introducing more brand extensions for Barbie and segmenting the market according to age. The second strategy involved targeting older girls by stretching the Barbie doll to other products such as perfumes cosmetics and music. Mattel also announced that to increase profit from Barbie it would create two distinct personalities of Barbie, one career oriented and the other, cyber Barbie that would specialize in the traditional gender role game. Alone with the change in the image, Mattel changed the packaging of Barbie dolls. Barbie boxes were redesigned, featuring the new logo. ‘Barbie was written in big letters while the name of the doll was written in big letters after the logo.

In 2000, Mattel launched jewel girl Barbie, which was able to move in more realistic way. Jewel girl Barbie has a soft smile and an oval shaped face. The doll was launched with around 20 outfits including slim pants, long spilt skirt, colored vinyl jacket and stick on fashion jewels. Due to all these initiatives, by 2000 Barbie sales reportedly increased by 9%.

However, in 2001, Mattel announced that Barbie’s sales declined by 12% in domestic market due to decrease in demand for the collector series and the holiday celebration series, in order to increase Barbie sales, in 2002, Mattel launched Barbie as Rapunzal, a computer animated video. Extending its computer- animated videos, Mattel launched Barbie as Swan Lake in early 2003.

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Question 3.

According to analysts technological innovations and the availability of various other forms of entertainment were turning young girls away from traditional playthings such as dolls. In this scenario, discuss the future of Barbie. Do you think Barbie will be able to retain its dominance? Justify your answer.

Answer.

The technological innovations and the availability of various other forms of entertainment such as video games and computers were turning young girls away from traditional play things such as dolls. In American and the other developed world, the young girls now consider that playing with dolls is childish. A lot of exposure is provided by internet due to which the young girls are moving away from the traditional play things such as dolls. In the context of developed world. But Barbie had a presence in about 150 countries. There is a lot of scope for Barbie in the developing world where the young girls are not so much exposed to internet and internet and computers. In the developed world, the girls are more inclined towards their career. When there were changes coming in the American society, Barbie was successful in the American society due to its adaptability to changing trends. Barbie had more than 80 careers with in a period of 40 years. The doll had played the role of college graduate, doctor, teacher, astronaut, presidential candidate, surgeon and business executive among others. The Barbie had enjoyed the success at that time but now the American society is mature and the young girls are not able to correlate the Barbie with their needs.

Barbie will be able to retain its dominance because it has a presence in 150 countries. The developing countries are also experiencing changes in the society and if young girls are able to correlate Barbie with their needs and changing society then Barbie will be able to retain its supremacy. This is an opportunity for Barbie to retain its supremacy. Mattel co has to adopt the proactive marketing strategy to campaign for Barbie and relate it to the need of young girls and the societal changes. Mattel co can adopt different strategies for different society. Barbie is very popular in the developing market and most of the market is still to be tapped. So we can say that Barbie is able to retain its supremacy.

In the context of the American society and the other developed countries of Europe, Mattel co has introduced the high-tech products like the Barbie scrapbook which came with talking stickers. Thus

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changing the strategy according to the environment which increases the sale of Barbie. Mattel Company has also introduced Barbie computer. So Barbie has changed its strategy according to the need of young girl. So we can say that Barbie will be able to retain its supremacy.

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CONCLUSION

Barbie Dolls Are Not Just a Child's Toy

Most women at one time in their childhood played with Barbie dolls. Most stopped by the time they hit their teenage years, but there are many who still love and collect them.

In this case study which all about based on a doll named Barbie, we find that how Mattel makes it effective according to people and we find lots of changes which happen due to the changes of American culture.

“A promotional campaign built around Barbie’s 30th birthday in 1989 propelled her onto the cover of Smithsonian Magazine, confirming her

status as a true American icon. The Barbie make-over was so effective that from 1987 to 1992 sales shot up from $430 million to nearly $1 billion, accounting for more than half of the company’s $1.85 billion in

sales. At that time, Mattel estimated that 95% of all girls in the United

States aged 3 to 11 owned Barbie dolls.” In 1991, a strengthened

strategic alliance with The Walt Disney Company gave Mattel the exclusive rights to sell dolls, stuffed characters, and preschool toys based upon Disney movie classics such as the Lion King and The

Hunch Back of Notre Dame. In 1993, Mattel acquired Fisher-Price in a deal lauded by Wall Street analysts. Four years later, in 1997, the acquisition of Tyco boosted Mattel’s revenue to $4.8 billion and “pushed Mattel, Inc. past Hasbro, Inc. is making it the undisputed leader in the toy industry.”

In 1997, Mattel introduced hundreds of new toy products. Many of the new toys reflected increased demand among core product lines - for

example, the market’s renewed interest in collectible Barbie and Hot Wheels products. Beyond core products, there remained a large, lucrative segment of non-core toys whose market life was typically less than one year, of which many were related to popular movie characters. These were high turnover products where time to market

was critical. Mattel typically produced core product lines in-house and outsourced the production of non-core lines to a network of vendors.

Outside vendors gave Mattel the needed flexibility to handle hot products and the seasonal changes in toy sales. In the US, toy sales historically followed strong seasonal trends with nearly 45% of all sales

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in 1997. As a child, everyone has many beautiful dolls, but none compares to the adult beauties of Barbie doll.

BIBLIOGRAPHY

Barbie’s Success story (Case study)

http://www.marlbe.com/

http://www.megaessays.com/viewpaper/4101.html

http://collectdolls.about.com/b/2004/11/08/barbie-doll-creator-ruth-handler-to-be-featured-on-pbs-series.htm

http://www.zimbio.com/Barbie+Collector/articles?error=Article+does+not+exist.

http://www.ru.org/society/barbie-around-the-world.html


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