Mattel’s Global Expansion: Analysing Growth Trends
Toys are one of the world’s oldest consumer products. The traditional toy industry, which was worth $2billion–$3 billion in 1968 evolved into a global market of over $61.8 billion in 2007.1 US is the largest toys and games market in the world, accounting for 34.1% of the global market’s value. Though only 2% of the world’s children reside in the US, they buy half of the world’s toys. The leading company in the US’ toys and games market is Mattel, which holds a 7.8% of market share2 ; followed by Hasbro with 5.3%. Mattel is also the world’s largest toy manufacturer and its best known brands include Barbie, Matchbox, Fisher-Price and Hot Wheels. Mattel was founded in 1945 by Harold Matson and Elliot Handler (hence the name ‘Matt-El’) in a garage workshop in California. The company started as a picture-frame manufacturer, but Elliot soon started a side business of making dollhouse accessories out of picture-frame scraps. The success of the dollhouse furniture turned the company’s focus on toys. In 1959, Mattel introduced the Barbie product line, which remains the most successful and the most popular brands even today. Mattel went public in 1960 and throughout the decade the company witnessed growth through acquisitions of smaller toy manufacturers. In 1968, Mattel created the first Hot Wheels products, which eventually became another highly successful brand. During the 1990s, Mattel merged with the Fisher-Price company (1993) and acquired Tyco Toys (1997), the third-largest manufacturer of toys at that time. The Fisher-Price deal made Mattel overpower Hasbro and become the leading toy company. The deal was, referred to as, the most significant acquisition in the toy industry; since the acquisition of Tonka Corp. by Hasbro in 1991. However, as competition in the toy industry was intense, the sales at Mattel slumped in 1996 and 1997. Mattel’s sales further dropped in 1998 owing to a massive recall of its...
Please join StudyMode to read the full document