The Dao of Barbie: Business Lessons from Her First 51 Years
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The Dao of Barbie: Business Lessons from Her First 51 Years

Barbie is 51 years old and still looking 18. Not only that, Barbie continues to enchant and delight even the eGeneration. Perhaps there are lessons we can learn from Barbie's business model.

Hey, Barbie! You are 51 years old-plus (March 9, 2009) and looking not a day older than 18. Some people might think you are an air-head, because of the way you look and because you are so focused on fashion. But the truth is there are more than one billion of you out in the Universe (give or take a million), and you are still going as strong as this economy will allow. What lessons are we to take from Barbie's unlikely success as one of the most popular toys ever produced? Well, here are a few lessons for today that I am calling The Dao of Barbie. Surely she can show us a Way. 1. Dare to Dream Big.  Back in the mid-1950s, Ruth Handler, Barbie's creator, saw the need to create a more adult, sexier teenage girl doll that little girls could role-play. Designers at Mattel, the Company she and her husband co-owned, were not enthusiastic about the idea, at first. When Ruth showed them the popular Bild Lillie adult doll she found in Switzerland, the Company changed its mind. They agreed that a doll with breasts had appeal for little girls, and they began plans to plan to manufacture Barbie in 1957. She made her debut on March 9, 1959 at the New York Toy Fair. The first year, 350,000 Barbie dolls sold for $3 each. The demand exploded thereafter. 2. Use your Experience and Your Connections. Ruth Handler was a whiz at merchandising and marketing. She knew the allure of glamour and dreams, since she had worked, for a time, at Paramount Studios in Hollywood.  When she combined what she knew about Hollywood with what she had learned from the fledgling toy business at Mattel, she had a blueprint for success. Mattel was already on its way to toy success with its burp gun and its plastic Ukulele. When Mattel became the sole sponsor for the  Mickey Mouse Club, the brand was on its way to becoming a household name and changing the way companies advertised on TV. 3. Change with the Times. Over the years, Barbie has adapted herself to every era - from Hippie Barbie (with afro) to Designer Barbie (with high-fashion clothing by high-end designers)to professional Barbie (doctor, airplane pilot)  to Tattoo Barbie (this year), the designers at Mattel have moved rapidly to meet the requirements of the times. Inadvertently, these changing styles have increased a collector's demand for limited editions and early Barbies. More than 8 million  Barbie collectors fuel this market currently (according to CNN).  Barbie's innovation and ability to capture each of the decades she she appeared have allowed the doll to stay in the market. 4. Go Global. Mattel does not reveal where Barbie is made internationally, but there are at least four factories spread across China, Indonesia and Malaysia that manufacture some components of the doll.  Even early on, however, Mattel recognized the need to keep manufacturing costs down by making Barbie in Japan.  From 1959 through 1972, Barbie was made in Japan. This included the original plastic mold and the fashion clothing, Mattel's early focus on the bottom line of manufacturing led to success and profit for the Company; a goal that can not be ignored in today's economy.The Global focus does not only apply to manufacturing. Mattel is now building a customer base for Barbie (children and young adults) in China. Recently Mattel opened a $30 million, six-story Barbie lifestyle store in Shanghai--complete with a spa where mothers can get their nails done with their daughters, a café and bar and racks of Barbie clothing. 5. Be Willing to change your Demographic to meet new audiences. Mattel has long reflected diversity in the line of ethnic Barbie dolls.  Mattel is now expanding its core market to include not only little girls but also club-age young women. Rather than depending on the usual market for Barbie, Mattel is now targeting twenty-somethings by offering a line of clothing by Patricia Fields, the Sex and the City designer. 6. Go Down, if you must, but not Out. The bad economy has affected the venerable Barbie; sales were down 9% in 2008, with the prospect for more declines this year and perhaps,next.  But Barbie has never gone out, even when she's seemed most defeated.  Take the 1970s, when Ruth and Elliot Handler were removed from management of Mattel and Ruth Handler pleaded no contest to mail fraud and financial irregularity charges. The loss of the Handlers from the Company they had built and the products they had created seemed to spell the end for both the Company and Barbie. But this was not the case; Barbie, the icon, persevered, as did Ruth Handler (she created a successful line of breasts prosthesis for breast cancer survivors like she was).   Even the recent challenge by the edgy Bratz dolls hurt Barbie, but couldn't replace her (Mattel won its copyright lawsuit against Bratz in 2008). 7. Maintain Quality Control. One of the reasons for Barbie's success is that for the past five decades, her quality has been head and shoulders over  copy-cat fashion dolls. Barbie Dolls have long been the gold standard for fashion dolls - from the accessories and clothes to all the dolls in the Barbie line, including Ken and Midge. The high quality is another reason for the huge number of collectors of limited edition dolls  and her accessories(shoes are easily lost). Quality control keeps the generational demand for Barbie alive and well, even in tough times. These are but a few of the lessons one might learn from the 50 years' success of the  iconic Barbie doll, Maintaining popularity in the fickle toy market is cause for reflection for anyone wishing to succeed in any business, especially in tough times.  Much of Barbie's success is owed to Ruth Handler and her vision and incredible merchandising and marketing skills. But there is much more to the success of Barbie, including some or all of the 7 factors mentioned above. Trend Analysis: Fashion doll popularity may suffer this year and beyond as high fashion becomes less important to the consumer, especially the Moms who buy the dolls. Expect mind-bending, intellectually stimulating games (even for the smallest children) to show growth as parents look for more ways to stimulate and engage their children's minds, and even help them get ahead in schooling.  Also look for a resurgence in growth in traditional, inexpensive, comfort toys like Raggedy Ann and Teddy Bears. These remind us of the good old days. They do not break and they do not require expensive, replacement batteries.

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