Is Barbie headed for retirement?

Golden Girl Finance
Is Barbie headed for retirement?

There has never been another doll like her. Many imitators have tried and many have failed. For fifty-four years, Barbie has been an icon to generations of little girls (and more than a few grown-ups as well). Barbie is the largest doll brand in the world and continues to be sold in 150 countries. Yet according to her producer, Mattel (MAT), sales of Barbie dolls were down 12% in the last quarter. More alarmingly, that’s the fourth quarter in a row in which Barbie sales have been dropping.

It isn’t as if kids are over dolls. Quite the opposite. Mattel reports that overall doll sales are up 11% in the US and 4% in Europe and are in fact, one of the fastest-growing segments within the toy industry. So what’s up?

There’s a new doll in town

It would seem that Mattel has become Barbie’s own worst enemy – her frenemy, perhaps? While Barbie sales have been dropping, Mattel’s own American Girl line of dolls has increased 14%. Coincidence? Mattel has also introduced Monster High dolls, which have already exceeded $1 billion in sales and are experiencing double-digit growth. And as if that’s not enough, Mattel has yet another line of dolls getting ready to launch, called Ever After High.

Whereas at one time, girls could choose from different variations of Barbie to suit their own styles and imagination, nowadays each slightly different demographic of girls is being pursued with a different type of fashion doll. American Girls for those who love classic, sweet, traditional dolls; Monster High dolls for the vampire-loving girls with a taste for the ghoulish; and now, Ever After High dolls for girls who are wild about fairy tales, princesses and fantasy stories.

Don’t cry for me, Malibu

Just to put this in perspective, it’s not like Barbie is fading out like Norma Desmond in Sunset Boulevard or dying off like the saintly Eva Peron. (Hmmm, Evita Barbie?) Her annual sales are still $1.3 billion a year and the company expects that Barbie will always be a billion dollar business. She just isn’t one of those super-high-growth, new start-up dolls. After all, it’s easy to have double-digit growth rates when you’re young, right? At the ripe age of 54, Barbie’s growth may have slowed, but she is still a powerful phenomenon among little girls of a certain age.

However, the sagging sales numbers do indicate that Barbie needs to up her game in a few areas.

Digital and diverse

No matter what kind of doll you are, the two biggest demands these days are to be: (1) digitally-savvy and (2) ethnically diverse. The popularity of Bratz and Groovy Girl dolls are evidence of the trend toward a broader spectrum of skin tones and hair colours in childrens’ dolls these days. As one industry expert recently said, “Barbie’s not going anywhere… But I think she will struggle as a white girl in a multicultural world.”

It’s also not enough for Barbie to merely carry around a fake pink plastic smartphone and work on a fake pink plastic laptop. Thanks to early-age computer literacy, kids want an app for that. Monster High dolls set a new standard last year when they launched an online campaign that connected girls with videos and reading material on the subject of self-esteem building. The Monster High website features games, videos, character information and webisodes to keep girls interested and interacting with new stories and interesting stuff to spark their imagination.

Fortunately, Mattel is already hinting at some new digital products to bring Barbie into this century. A digital makeover app and digital fashion design technology will hopefully give the old girl some edge in the critical lead-up to holiday sales season.

C’mon Barbie, let’s go party

We have faith in the Barbs. She started out as a simple surfer girl in Malibu and has transformed herself many times over throughout the years, emerging as an astronaut, an Olympian and even a presidential candidate. She survived Cabbage Patch Dolls, Strawberry Shortcakes and Smurfs. Surely, Barbie can handle the latest competition. Now that she is in her mid-fifties, it’s time for Barbie to prepare for what actress Jane Fonda would call her ‘third act’. Good luck to you Barbie, we hope we never have to see that pink Corvette driving off into the sunset. A Tesla, maybe.

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