Friday, April 28, 2017

That's what Mattel gets for ignoring the 80/20 rule.

In first quarter 2017, Hasbro's revenue exceeded Mattel's for the first time in 17 years. (2017)  Mattel's worldwide sales fell 15%; gross profit fell by 28% versus year ago.  Sales for Barbie fell 12%.  (Bond, 2017)

I wish I could say that I was surprised. 

Back in the fall of 2015, Mattel created a new campaign for Barbie with a heavy empowerment angle that was very well received by my students.  You can read their comments here...

In 2016, Mattel introduced a variety of Barbie dolls with different body shapes and things seemed to be headed in the right direction.  But in January 2017 they announced that they were beginning a new campaign targeting Dads.  Oh. Oh. 

The Pareto Principle, usually referred to as the 80/20 rule tells us that for any brand, 20% of the users account for 80% of the sales.  We target these heavy users in marketing because the easiest sale to get is to get someone who is already using the brand to use it more. Next comes converting users of competitive brands.  Their audience profile tends to be the same as current heavy users.  And, if you finally do get to new users, they too will tend to be similar to current users.

Targeting people outside of the 20% only makes sense if you can identify a niche segment that has a higher level of interest in the brand and can be efficiently reached through media, because even if you can win them over, they are likely to spend less money than the heavy users.

Unfortunately I could see no evidence in the creative that ran for the campaign that the company had any compelling insights into the behavior and feelings of Dads that warranted a change in target.  Rather, I was concerned that the commercial was a step back in terms of female empowerment and was unrealistic and therefore unrelatable.  You can check it out here...

So what to do now?  I'd start by checking out this video for Moschino Barbie.  They are definitely on to something.  The doll is currently selling for $325 on eBay.

(2017, April 24)  Hasbro heads for the loo and business booms.  Retrieved April 27, 2017, from

Bond, J. (2017, April 22)  Toy Maker Mattel Sales Slump in 1Q 2017, and it's the Same Old Story.  retrieved April 27, 2017, from

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