One of the major issues identified for Mattel’s would increase in competition in the industry. There are some other relevant issues associated with this issue that includes:
From this, it can be said that competition is one of the major problems that the business is facing. There are various companies coming up with new products in the industry, which result in major competitors and effective the company’s revenue. Management has to bring innovation and major changes in the marketing of goods to gain competitive advantage and sustain in the industry further (Chari & Feng, 2018).
These issues can be analyzed through the various model. For instance for analyzing the competitor’s industry analysis needs to be done for which porters five force models can be applied. According to Porter’s five-force model, the major five forces that are affecting the Mattel business decision would include
Another model that can be helpful to analyze Mattel internal and external environment analysis would include SWOT analysis
Strengths
Weakness
Opportunities
Threats
Moreover, the issues identified can be analyzed through the STP of the company.
The company has segmented the goods through customized and innovative dolls that can be involved in various activities.
Target
The company is targeting the young females of the upper and middle-class group. This could be one of the reasons for the issues of gender stereotypes identified in the previous section.
Positioning
The positioning of the product was different since years but one of the major positioning includes Barbie serving as a role model for a teenage girl. This has been one of the major causes of unrealistic body shape issue identified previously. This has affected the teenage girls to believe that they need to have a very small waistline and similar body shape to look beautiful, which was completely unrealistic (barbie.mattel, 2019).
These issues could be the reason for the decrease in gross sales of the company.
Figure 1: Mattel’s (Barbie) gross sales from 2012 to 2018 (Source: (statista, 2019)
From the figure it can be analyzed that the company has faced a various decline in sales volume since years.
Some of the alternative strategies that the company could have adopted in order to overcome the issues that are competitive strategies of the company could include:
Figure 2: (Source: (Betton, 2017)
Considering the porter’s generic competitive strategy the company needs to sustain in the increasing competition, for which one of the relevant strategies would be a differentiation strategy. According to this strategy, the company will consider approaching a broad customer base with innovation through the product. This could include a new range of products that would increase in activities by Barbie.
Ansoff’s matrix: New product development
Figure 3: (source: (Aksoy, 2018)
For the product strategy of the company, Ansoff’s matrix could be used. There are various strategies that a company can be adopted according to the market to be targeted and products to be offered to the customer. This may include offering existing products in an existing market or existing product to a new market. Other two grinds indicate a strategy that includes offering new product to a completely new or untapped market or new product to be offered to the existing market. Barbie has already tapped most of the market worldwide due to which the scope for tapping into a new market is not been identified (Baker & Bowen, 2015).
The most approachable strategy for the company to overcome the decreasing sales of the company would be a product development strategy. The company could introduce toys with technological advancement and a new product line. This could be investing in technology to be integrated with the product or completely new product range like online Barbie games original to be played through paid applications or video games.
The major advantages of this strategy would be overcoming the saturated market issue. The market for the Barbie dolls has been saturated and the need for some new product by the brand has been identified. Another advantage would be an increase in customer database and would help to target boys along with girls with new products to offer. However, the major disadvantage would be an increase in the risk of the success factor of the product due to existing customer perception as Barbie being a popular brand for girls. Moreover the investment would be huge for this strategy to be implemented and for new product development some changes have to be adopted by the company according to the nation in which it must be offering new products (Betton, 2017).
The current pricing strategy of the company is premium pricing. However, the company can adopt a competitive pricing strategy and price skimming strategy that is reducing the cost of the price when new model being launched (Chu & Liu, 2017).
Brand repositioning
There is a need for the brand to reposition its self in the market. Considering the figure below one of the major competitor of Mattel is LEGO, who follows this strategy that is existing in the educational grid. Barbie can move towards the educational use of toys and gain Educational opportunity as the parents or mother would prefer to go for the educational toys for their kids at priority (Doole & Lowe, 2008).
Figure 4: (Source: (Hsu, 2016)
Some of the recommendations made to the brand manager of the company would be
Conclusion
From this piece of research, it can be concluded that the toy industry is changing since years and due to increase in competition one of the largest toy manufacturer, Mattel’s Barbie brand has faced various issues for which the report included developing a strategic marketing strategy for the company. One of the major issues identified was the increase in a competition associated with some other issues like unrealistic body image, privacy concern, and gender stereotypes. These issues were analyzed using some of the models like the porters five force model, SWOT analysis, and understand the STP of the brand.
The strategic marketing strategies included product differentiation, new product development, price skimming strategy, and aggressive promotional strategy.
References
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barbie.mattel, 2019. home. [Online] Available at: https://barbie.mattel.com/shop/en-us/ba/all-new.
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