Yahoo Finance Barbie is the most diverse doll you can buy, says Mattel boss
With Christmas mere weeks away and reports of toy shortages rippling across the world, Ynon Kreiz would be forgiven for appearing flustered.
But the boss of Barbie owner Mattel doesn’t appear to be losing sleep over the idea that it could struggle to get toys into shops for the festive season. “We're going to try to meet all of the demand, but I'm not sure we’ll be able to,” he says, almost shrugging.
It seems an usual attitude to take as supply chain disruptions cause havoc ahead of the festive season.
The reason being, Kreiz argues, is that for Mattel it is not proving such a hurdle. Instead it is struggling to keep up with demand as people simply buy more.
“We have seen early shopping, but, you know, this doesn't mean that it is instead of or a trade off for the end of the year,” Kreiz says. Mattel pushed price rises through in its third quarter to cope with inflation, yet even that is not dampening appetite. “We're seeing strength and demand still there. It's still continuing.”
This means it “might not be able to cater for all of the demand, simply because the demand is so strong” - not such an issue at all.
While it could seem Kreiz is talking his business up, the numbers speak for themselves. The sales bump is already being factored into forecasts, with the American multinational on track to record its highest level of growth in decades.
It expects revenues to surge by 15pc compared with last year, when sales were already buoyed by parents splurging to keep their children busy during lockdowns. This year its New York-listed shares have risen more than a fifth.
For a company which has been tackling declining revenue for years, it appears things are finally starting to fit into place.
Before Kreiz joined in 2018, Mattel cycled through three chief executives in four years. Now, three years after taking the helm and returning the company to profitability, his focus is shifting to a new challenge: turning the toy maker into a toy company.
For Kreiz, it is an important distinction.
“We now think and operate much more as an IP company,” he says. Mattel’s brands - the likes of Hot Wheels, Fisher-Price and He-Man - should not just be toys, but franchises.
“Here we are with this incredible offering across different genres and legacy heritage brands that everyone knows, that have not been part of film and television or online games or theme parks. We have an opportunity for Mattel to do just that.”
It is unsurprising he is diving into this realm. After all, Kreiz’s background is in entertainment - he co-created Fox Kids Europe in the 1990s before later going on to head up Endemol, the maker of Big Brother and Deal or No Deal reality shows.
They are roles that have led the Israeli set up roots in London. While he now lives in Los Angeles, California, his four children with two-time Olympic sailor Anat Kreiz were all born in the UK capital and the family still own a house in the city.
“Yes, TV is very much my background,” Kreiz says, “but in many ways, it’s a move that’s almost obvious”.
“We’re not the first ones to try to take a franchise to the big screen or television.”
In fact, many would argue Mattel has been too slow to seize the opportunity. Disney and Lego have well-established theme parks and huge film franchises. Even toy-maker rival Hasbro has the Transformers and My Little Pony films.
“Look, we can learn a lot from Disney,” says Kreiz. “A good analogy is what they did with Marvel, which was a catalog of comic book properties that they were able to reimagine.
“No one necessarily knew some of those properties when they acquired that company. I imagine no one looked at Guardians of the Galaxy or Black Panther, and knew from the outset that this could be what it became.”
In his view Mattel’s line of brands, headed up by one of the best-selling toys ever - Barbie - has the potential to be even more popular. Thirteen films are in development. Among the first is a Barbie movie to be directed by Greta Gerwig, starring Margot Robbie and Ryan Gosling.
The following ones won’t just be pegged on better-known brands such as Hot Wheels, but also “based on brands that we haven’t commercialised for decades”.
“It's hard to find such a collection of legacy heritage quality brands that have that global recognition and awareness. And people have a very emotional connection with toys,” the 56-year-old says.
“Children touch and hug toys and they go to bed with toys. And, for parents, well, we all remember our favorite toys.”
Yet Barbie’s brand recognition is something of a double-edged sword for Mattel. Some of the older generation who grew up with the toy later came to view its stick-thin figure and pristine bleach blond hair as a damaging influence that made them insecure about their looks.
A study by the University of Durham earlier this year suggested children were more likely to develop an eating disorder after playing with Barbie just once.
The chief executive argues Barbie has changed. “It’s the most diverse doll on the market now,” he counters. “Barbie is probably ahead of the game. She’s very much the flag carrier in terms of diversity and empowerment.”
New lines of Barbie dolls have been launched, ones with different body shapes, different ethnicities and with disabilities. And in 2019 Mattel launched gender fluid versions with the tag-line “a doll line designed to keep labels out and invite everyone in”.
Mattel has also shifted away from marketing certain toys to specific genders, according to Kreiz: “Today, we think in terms of categories rather than by gender.” Mattel research does , however, suggest more girls are still buying Barbie dolls than boys.
While trying to adapt, the company has found itself facing criticism from some parents who argue it has gone too “woke” and is thrusting concepts that their children cannot comprehend.
“I’d say you can't cater to everybody with one product,” says Kreiz. “We offer people different genres, different demographics, different experiences, and then hope to cater to as many people as we can.”
He uses Barbie - first created in 1959 - as an example of this. “Barbie is very timely and timeless, you know, for a 62 year old. The doll that became a cultural icon.”
The role of Mattel is to “always stay current”, Kreiz says. “Yes, the market is evolving, and consumer tastes and preferences change. It’s not a reaction, it's about being proactive, and thinking ahead and finding ways to stay current.”
New dolls are one avenue, but some of Kreiz’s other solutions may raise some eyebrows. The company has recently pushed into non-fungible tokens (NFTs), for instance, creating digital collector items which customers can pay for using cryptocurrency.
In the future, he does not rule out accepting cryptocurrency for physical toys. “We’ll have to see how the market evolves.”
But for now Kreiz seems to be enjoying shifting back into the world he knows and loves. “Everyone is looking for big franchises, every part of the media and the entertainment industry is looking for big brands, big franchises, standouts that would make a difference. And here we are with this incredible offering.”
He argues this drive into TV and film is far from an effort to simply sell more toys.
Still, the toy maker should probably prepare for it. If Mattel is seeking to emulate Marvel’s success, a further sales bump could be coming fast. Then Kreiz may not be so unflappable.
