Don’t mess with Barbie.
Sales of the world’s most iconic plastic doll have plunged, leading to the resignation of Mattel Chief Executive Bryan Stockton. Christopher Sinclair, a board member, will take over as interim CEO of Mattel MAT, -0.31% . “The board believes that it is the right time for new leadership to maximize its potential,” Sinclair said in a statement. Mattel sales fell 6% year-over-year to $ 1.99 billion during the holiday quarter, while profit plummeted 59% to $ 149.9 million, Mattel reported Monday. In the third quarter, Barbie sales fell 21% year-over-year; fourth-quarter results are due on Jan. 30, 2015.
Barbie arrived in stores in 1959 — when Dwight D. Eisenhower was president — and in the intervening years has been a favorite doll and a cultural icon, but at times struggled to find her footing. Barbie — with careers as varied as astronaut, presidential candidate and chef — has faced competition from newcomers like MGA Entertainment’s leopard-print-clad Bratz dolls and criticism from researchers showing how Barbie’s unrealistic proportions affect young girls’ body image. In 2013, artist Nickolay Lamm created a Barbie doll with a “normal” figure, using Centers for Disease Control and Prevention measurements of an average 20-year-old woman weighing 166 pounds. Barbie also suffered from “age compression,” or kids getting older younger and tiring of toys at a younger age.
“Maybe Barbie is a financier instead of a stewardess, but it’s pretty much the same Barbie no matter how you spin it,” says Jaime Katz, equity analyst at Morningstar. Barbie accounts for around 18% or $ 1.2 billion of Mattel’s $ 6.48 billion in annual sales. “There are a lot of girls who aren’t playing with traditional dolls,” she adds. Mattel’s other brands — such as American Girl, which encourages girls to find a doll that suits their personality and interests, and Ever After High (teenage offspring of fairy tale characters) and Monster High (teenage offspring of ghouls) — continue to grow, Katz adds.
Barbie has also been slower than other toy makers to tackle some social issues. In 2012, MGA released bald versions of its Bratz and Moxie Girlz dolls after social networking pages called for toy makers to create hairless dolls to support children with cancer, donating $ 1 from every doll to the City of Hope charity for cancer research. Mattel responded two months later with a “Beautiful and Bald Barbie” Facebook page by distributing a bald “Friend of Barbie” rather than actual official Barbie doll to children’s hospitals with accessories like wigs, hats and scarves. And in 1992, there was the ill-judged “Math class is tough” talking Barbie.
Mattel has stayed current in other ways, introducing 40 nationalities, apps, e-books and movies — the latest, “Power Princess,” which casts Barbie in the role of superhero — her own web series “Barbie: Life in the Dreamhouse,” which pokes fun at her fluffy persona, and adding other dolls. Ruth Handler, who created Barbie, never wanted Barbie to have her own distinct story, says Christopher Byrne, content director of TimeToPlayMag.com. “Barbie is an evergreen brand,” he says. “She’s always been cyclical and needs to be periodically reinvented.”
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“In 2015, having an outside story is an integral part of dolls. That’s been a challenge,” Byrne says. Barbie’s target market has shrunk to girls aged 3 to 6, hence Mattel’s other dolls, he adds. “It’s time for Wall Street to look at Mattel’s entire doll portfolio and not put so much weight on those little plastic shoulders.”