Analysis of Mattel vs Hasbro

Topics: Mattel, Hasbro, Toy Pages: 7 (2310 words) Published: November 14, 2011
Mattel vs Hasbro

Mattel was founded in 1945 by Matt Matson and Elliot and Ruth Handler as a picture frame manufacturing company. The name Mattel was derived from a combination of the two names, Matt and Elliot. They operated out of a garage in Southern California. Handler then recognized an opportunity and began to manufacture dollhouse furniture with scrap material from the picture frame business. Matson quickly sold out to the Handlers who then changed the focus of the business to toys. In 1955 Mattel changed the way toy companies advertise. Up until this point, toy manufacturers relied on retailers to showcase and sell their products. The only advertising was done for the holiday season. Mattel decided to take a chance, and became a year round sponsor of a fifteen minute segment of the Mickey Mouse Club television program. The deal cost Mattel $500,000 for 52 weeks, which was approximately what the company was worth at that time. It was the first time that a toy manufacturer advertised on television year-round marketing directly to children. They acquired the rights to produce Mickey Mouse Club merchandise, and capitalized on products such as the “Mouse Guitar” in the 50’s. In 1959 Mattel again revolutionized the industry. Ruth Handler developed the Barbie Doll named after her daughter Barbara. The Barbie line of products has proven to be remarkably successful and today is responsible for 80% of Mattel’s profits. The 1960’s and 1970’s were a time of expansion for the company. They developed products such as Chatty Cathy and the See N Say product line. This was also when Hot Wheels was introduced. Since its introduction in 1967, there have been approximately 10,000 different models of Hot Wheels die cast cars. The 1970’s also saw Mattel’s entrance into the world of electronic games. In 1982, Mattel launched the “Masters of the Universe” product line. It became a “media franchise” and inspired several animated television series, many comic book series, and a major motion film in 1987. In 1985 alone, the Masters of the Universe product line made over $400 million for Mattel. They acquired Fisher-Price in 1993 expanding their product lines even further. By 1997 they had bought out TYCO. At the time, TYCO was the third largest US toymaker. Continuing their drive for expansion, in 1998 they acquired the Pleasant Company and with it their highly successful American Girl brand. In 2005 they partnered with Oasys Mobile, a mobile game developer. They produce the mobile games based on the Mattel franchise brands. These include UNO, Ker Plunk!, Toss Across, Barbie, and even Rock ‘em Sock ‘em Robots Mobile. In contrast, 2007 was a very difficult time for Mattel. In August, Fisher Price recalled approximately 1 million chinese made toys – including the popular Dora the Explorer and Sesame Street toys – for using lead based paint that exceeded the US federal limit for lead content. Later that same month, Mattel recalled over 18 million products because of small magnets that could possibly detach and be swallowed by children. The magnets were small, but very strong, and if more than one were swallowed could cause intestinal perforation. While no US or European safety legislation standards addressed this problem specifically, Mattel rewrote its own policy on the use of these magnets, and issued the recall. Mattel was issued a fine in 2009 by the Consumer Products Safety Commission for their violation of the Federal ban on lead based paint. They agreed to the fine, but did not admit to any wrong doing. Today, Mattel is the world’s largest toy distributor. Their products are sold in over 150 countries. They closed their last American factory in 2002 and is now primarily manufacturing their products in China. As of December 2010, Mattel employs 31,000 and is based in El...
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