Overcoming Marketing and Manufacturing Challenges Essay Example

(Ferrell, et. all 459).

Despite Barbie's significant role in Mattel's product lineup, its popularity has waned recently due to the rise of new and creative competitors. These rivals, such as MGA's Bratz dolls, have succeeded in engaging the contemporary youth culture by offering dolls that portray "modern, ethnically diverse designs and bold outfits" (Ferrell et al., 459). Mattel asserts that their former employee Carter Bryant created the concept for Bratz dolls before defecting to MGA who initiated production of these dolls from 2001 onwards (Ferrell et al., 459). Reacting to what they perceived as Bryant's dishonest behavior, Mattel pursued a lawsuit against him and MGA. Both Mattel and a federal jury agreed that Bryant broke his employment contract with Mattel by devising Bratz while still employed there.

Not only was MGA convicted of copyright violation, but they were also held culpable for willful disruption of contractual relationships, assisting in the breach of fiduciary duties, and contributing to loyalty duty infringement (http://www.msnbc.msn.com/id/26410627/). Both MGA and its CEO were deemed liable for what was termed as "purposeful disturbance" in relation to Bryant's contract with Mattel (Ferrell, et. all 459). In terms of their copyright infringement, it came about when MGA introduced the widely acclaimed Bratz brand that currently features over 40 characters along with various additional lines such as Bratz Babyz, Bratz Petz, Bratz Boyz alongside merchandise like helmets, backpacks and bed sheets (http://www.msnbc.msn.com/id/26410627/).

Mattel's main age group, often referred to as "tweens," demonstrated a heightened interest in the modern attributes of Barbie dolls. This fascination resulted in a notable reduction in domestic sales. There was a 15 percent drop recorded in 2007, followed

by another decrease of 12 percent during the initial quarter of 2008. Conversely, international sales experienced a marginal rise by six percent in 2008; however, this gain was only half compared to the growth rate at twelve percent noted the previous year. Source: (http://www.msnbc.msn.com/id/26410627/). Mattel's failure to handle its employees effectively and adapt to changing psychographic characteristics within its key consumer segment became apparent after certain legal proceedings and their subsequent results. Issues related to international supply chains also surfaced.

Mattel's significant global influence means that they need to be cognisant of the complexities international business often carries" (Ferrell, et. all 463). Nonetheless, they failed to effectively oversee their international manufacturing operations. Mattel had to initiate a recall in 2007 for "1.5 million toys made in China" that consisted of lead paint and strong magnets, presenting a risk of choking to children (http://www.nytimes.com/2007/08/28/business/worldbusiness/28iht-mattel.4.7289 869.html). These potentially harmful products were the fallout of their foreign manufacturers not complying with Mattel’s stringent ethical and safety regulations, in addition to Mattel not thoroughly investigating their international contractors and performing audits on the "whole supply chain, including subcontractors" (Ferrell, et. all 463).

Mattel got overly confident about its operational competence in China, which led to them disregarding the underlying reasons for the toy recalls (http://www.nytimes.com/2007/08/28/business/worldbusiness/28iht-mattel.4.7289869.html). This oversight facilitated certain infringements to take place. The chain of issues began when subcontractors involved unauthorized third-party sellers. One such Mattel subcontractor, Early Light Industrial Co., outsourced the painting of some toy parts to another Chinese vendor (Ferrell et al., 462). Despite Mattel's instruction to use paint provided by Early Light, this vendor, Hong Li Da, chose to buy paint from

an unapproved third-party supplier (Ferrell et al., 462). In a bid to cut corners and speed up operations, this non-compliant supplier utilized lead-heavy paint that was not acceptable. As Mattel increased their outsourcing and subcontracting activities, managing production techniques and materials became more difficult for them. With an escalating number of suppliers and subcontractors in their supply chain network, Mattel was caught using unlawful and dangerous substances resulting in global toy recalls that tarnished their brand reputation.

Although the incident took place in China, and was linked to the Chinese government's inability to adequately safeguard the public, Mattel was held responsible for all products manufactured under its brand (Ferrell, et. all 463). Essentially, Mattel's faulty "oversight and market observation" resulted in massive toy recalls. The misuse of foreign manufacturers, contractors, and global supply chains led to the use of harmful raw materials in the production of Mattel toys. Initially, codes, safety norms, and business ethics were overlooked, and Mattel ultimately failed to honor its social and ethical obligation to produce toys that are both safe and enjoyable for children. Addressing Technological and Socioeconomic Issues:

In the last ten years, technological progress and changes in social and economic trends have birthed unique challenges in marketing, privacy, and product creation for Mattel. As this firm's main products cater to children, it needs a keen awareness of societal issues and privacy matters linked to kids' rights (Ferrell, et. all 463). It also has the responsibility to effectively convey its marketing strategies to parents (Ferrell, et. all 463). In an effort to bolster its dedication to business ethics and educate both children and adults about its online

marketing tools' philosophy, Mattel has a comprehensive online privacy policy on its website (Ferrell, et. all 463-464).

In partnership with its subsidiary companies, Mattel makes a deep-seated pledge to safeguard your online privacy while navigating their websites. This vow is meticulously explained in their policy (http://corporate.mattel.com/privacy-policy.aspx). They affirm that they do not collect or retain any personal information online unless voluntarily provided by users who are either over 13 years old or possess authorization from their parents or legal guardians. The only instances that deviate from this rule are specific limited situations mandated by law and clarified within this policy (http://corporate.mattel.com/privacy-policy.aspx). Acknowledging increasing societal concerns, Mattel recognizes the importance of demonstrating its ethical commitment and social accountability by assuring parents about the protection and respect of their children's online privacy (Ferrell, et. all 464). As technology rapidly evolves transforming children's lifestyles, Mattel confronts novel challenges such as widespread youth trends like video gaming systems, handheld music devices, text messaging tools, and diverse social networking platforms (Ferrell, et. all 466).

With the rising popularity of technology-based toys, films, music, and internet activities, youngsters are progressively participating in extracurricular pursuits like sports, music, and volunteering (Ferrell et. all 466). This trend is causing traditional toys such as those produced by Mattel to lose their allure with younger consumers. To adapt to these ongoing technological and socioeconomic changes, Mattel introduced a new line of 'My Scene' dolls aimed at the 'tween' age group (Ferrell et. all 459). They crafted this product to be more fashionable, youthful and attractive for this demographic that is slowly moving away from doll play (Ferrell et. all 459). Moreover, Mattel created

a website (http://www.myscene.com) where girls can engage in various entertaining interactive and promotional activities (Ferrell et. all 459). Yet overcoming challenges related to technological transformations, changing socioeconomic trends and privacy issues will continue being crucial for Mattel until they successfully adapt their marketing strategy and product innovation according to these market hazards. Potential Alternatives:

In order to fix their operational issues, enhance their marketing plans and product evolution, and rectify their past faults and prevent future ones, Mattel has strengthened its ethical practices for self-protection and customer safety (Ferrell, et. all 466). Mattel has implemented a regulation prohibiting subcontractors from hiring suppliers far down the supply chain and dedicated over 50,000 hours inspecting vendors and evaluating their toys for quality and safety (Ferrell, et. all 463).

Mattel has demonstrated its dedication to social accountability, human rights, product safety, and ethical guidelines through audit processes in all its production sites and those of its main contractors. They've also established the Mattel Independent Monitoring Council (Ferrell, et. all 464). Nevertheless, Mattel is not exempt from managerial and socio-economic difficulties requiring additional measures. These problems have sprung up from various sources such as deficiencies in their legal affairs, complications with overseas manufacturing, and challenges keeping up with changing socio-economic trends and technological progress. Potential remedies for these issues might include conducting safety protocol training sessions for production staff members, sending out internal auditing teams, and concentrating on the development of technology-based toys.

Exploring Potential Solutions for Academics: One viable strategy to tackle Mattel's issues of substandard management may involve compulsory training programs on manufacturing and safety standards for all their managers and workers. This method

is inspired by the inability of several Mattel contractors to comply with the company's safety & human rights policies, which has led them to now enforce a unique regulatory review at production locations every three years. By requiring their external associates to participate in instructional seminars centered around upholding safety regulations, establishing a safe production chain, and complying with local and national toy-related laws, there could be a reduction in violations throughout the manufacturing process.

The training programs would also enhance the consciousness of Mattel’s employees about the significance of adhering to safety protocols and human rights norms. During these programs and workshops, the legal rules and regulations related to safety and manufacturing standards will be used to assess the employees. These instructions and learning events should be organized consistently and should not be halted for any cause. Even though contractors may consistently adhere to all regulations, it is critical that they are routinely reminded about their relevance. Initially, adopting this solution might be slightly costly for Mattel, taking into account the expenditure involved in recruiting knowledgeable and certified instructors as well the logistics for the trainers as well as employees. Furthermore, in times of financial strain, these training programs might be put on hold as an initial budget cut. However, the long-term impact of instilling lasting understanding among employees surpasses any short-term consequences. Internal Auditors:

If Mattel's management implements internal auditing procedures, they can gain knowledge of new problem detection strategies and heightened awareness of probable issues. This will enable the company to evade oversights during assessments of international manufacturing processes, mitigate economic losses due to legal penalties and lawsuits, and maintain

adherence to toy standards and rules. To scrutinize the complexity of Mattel's activities, internal auditors could employ surveillance methods.

The auditors will be tasked with overseeing the decision-making procedures, operational selections, subcontractors, and the entire supply loops of management. Moreover, they are expected to control the intricacy of these processes and operations. By hiring in-house auditors, Mattel can ascertain each manager's responsibility instead of attributing things like product recalls solely to subcontractors. While there may be short-term implications such as the cost of hiring auditors and potential dissatisfaction amongst Mattel officials and staff; in the long run, the regular scrutiny of their work could incentivize employees to prevent deviations from the company's high expectations and obligations. Technology-based Products:

A technique that Mattel could utilize to tackle its issues is by emphasizing the creation of high-tech toys. Expanding their My Scene and Barbie ranges in reaction to technology's growing influence on consumer goods could allow Mattel to stay competitive, keep up with technological progress, and adapt to the changing lifestyle preferences of their customers (Ferrell, et. all 466).

A film featuring the My Scene characters would be centered around their daily lives as average high school girls. Barbie's appeal has traditionally been towards a younger demographic, primarily due to her movies exploring her fantastical personas such as a mermaid. In contrast, My Scene films would narrate day-to-day activities that an average girl encounters, including fashion, attending music shows, shopping, and making pop culture references. In today's connected society, much of our lives have been moved to the online world. This shift has led to a decline in Barbie doll sales as her primary

audience has shown a preference for online interactions instead of traditional playthings like dolls. To adjust to this changing market trend, Barbie and My Scene dolls should focus on offering a unique and engaging digital experience for its targeted users. Specifically for My Scene, a fully online social universe should be established.

In the modern digital era, there's provision for girls to craft their unique My Scene avatars and engage with others in the My Scene virtual realm. Numerous alternatives are available such as gaming, purchasing avatar costumes, personalizing one's living quarters, and throwing parties for fellow My Scene members. These activities could potentially expand both the My Scene and Barbie brands, bolstering Mattel's technological toy range in response to the surging preference for tech-centric toys. Even though this strategy may necessitate significant expenditure on research, development, and experimentation phases, it might ultimately enable Mattel to more effectively counteract innovative competition within this ever-changing technology-oriented socioeconomic environment.

A thorough review of Mattel Inc. exposes the corporation's strong and weak points. The strengths hinge on their primary brands being well-known. Since 1960, Mattel has joined the ranks as "the biggest toy firm globally in terms of revenue" (Ferrell, et. all 457). Currently, Mattel Inc. holds a position of leadership worldwide in the creation, production and promotion of family merchandise" (Ferrell, et. all 457). Baronie, Fisher-Price, American Girl, and Hot Wheels are among this family-oriented toy company's pillar brands.

Renowned globally, the Barbie brand holds the title of being America's top-selling doll and has been a significant asset for Mattel since its launch in 1959. It still stands as Mattel's flagship product (Ferrell, et.

all 458). With the acquisition of "Pleasant Company," the creator of American Girl collection, Mattel effectively implemented its long-term strategy to reduce dependence on conventional products and contesting Barbie's 'flawless image' stereotype (Ferrell, et. all 460). Post-acquisition in 1993, Fisher-Price transformed into the main brand used to market all of Mattel’s products designed for infants and preschoolers” (Ferrell, et. all 461).

Mattel has effectively gained the confidence of parents by creating safe, beneficial, and educational items (Ferrell et. all 461). The company's brands are immediately identifiable, allowing them to profit from their reputation. This approach, known as brand leveraging, allows Mattel to support its introduction into a new product line using its existing name. This was demonstrated in the creation of the My Scene dolls. Beyond their brands, another advantage of Mattel is their worldwide presence. A comprehensive external analysis of Mattel reveals the opportunities and obstacles facing the company.

Mattel is confronted with multiple obstacles including escalating domestic and global rivalry, economic unpredictability due to volatile oil costs, international laws and moral issues, alterations in their preferred customers' ways of life, the impact of contemporary technology on current products, and grasping the purchasing power and needs of clients in foreign markets. Despite this, Mattel holds significant promise for manufacturing tech-oriented products. Judgement:

Upon evaluating the merits, strong points, and downsides of all feasible options, we propose that the most favorable course of action for Mattel involves hiring in-house auditors. While this approach may require a considerable initial investment, it promises cost-effectiveness over time as it will reduce the company's involvement in lawsuits. The auditors will ensure Mattel's staff complies with appropriate

safety measures, cease inappropriate use of subcontractors, and foster the creation of safe products. This solution will also enable Mattel to enhance its product design and quality supervision - an area identified as a concern for the company in the first instance (Ferrell, et. all 462).

Implementing the Strategy: For Mattel's internal auditing system to achieve expected outcomes and function effectively, several elements must be considered during its implementation. It is crucial to carry out frequent audits of the manufacturing process as well as all manufacturers involved. It's equally important that employees comply with audit rules. Adequate funding should be provided for monthly or quarterly audits. The burden of supervising both local and international supply chains in addition to the manufacturing procedures and product quality will fall on personnel from the Human Resources Department and Operations Management Department.