Stock in Focus: Barbie's lessons for the stock market

As a woman in investing I am very conscious of my opportunity and responsibility. To make it easier for women to talk about money and dispel the stereotype that stock markets favour boys clubs. And so (at the risk of exacerbating another stereotype), I can’t help but feel excited to see that Barbie has recently found herself in the business headlines, thanks her first ‘real life’ appearance on the silver screen.

Now, it would be extremely hypocritical of me to assume that women are more interested in Barbie than men. But I am also confident that among my fellow writers at Stockopedia, I am the best qualified to write about her. I grew up in the 1990s when Barbie was in her heyday. In the year I was born, Barbie was the top selling toy, generating over $1bn of sales for her owner Mattel.

But by the turn of the millennium, attitudes were starting to change. In 2000, my grandparents traveled to Sydney to watch the Olympics and brought back with them a pair of champion Barbie athletes for me and my sister. They joined ‘dentist Barbie’ (who also incidentally spoke German on account of the fact that she had been purchased in Switzerland) as the only dolls in our collection with a career. The rest of our Barbies went shopping, attended pool parties and dressed as princesses - all activities that a burgeoning feminist movement feared made girls less ambitious and more fixated on starving their way to a perfect body.

And as feminists and concerned parents fuelled negative headlines, Barbie sales slumped from a peak of $1.3bn to $910m in 2015. The downward trend mirrored wider problems at Mattel where sliding sales and high costs sent the company into an operating loss in 2017 and 2018. At the end of that year the company lost its licensing rights for DC characters including Batman and Superman and the company’s share price fell to a two decade low.

A multi-media approach to recovery

Enter Ynon Kreiz - a new chief executive with a multi-media marketing plan to rescue Mattel from the doldrums. After stripping out non-essential costs and helping the company back into profits, Kreiz put together a global franchise management team, tasked with bringing together consumer products, digital content and live events. The film which hit the silver screen on Friday is a prime example of the value this team has brought to the company.

The Barbie movie has been described by some of the more sceptical critics as a two-hour long advert for Mattel’s most famous doll. It doesn’t matter that Margot Robbie’s incarnation of ‘Stereotypical Barbie’ embodies many of the problems which feminists had with the doll in the early 2000s, or the fact that the film pokes fun at Mattel and its management team (Kreiz is played by Will Ferrell), the Barbie Movie has tugged at the heartstrings of nostalgic 30-somethings (the target audience for this film) who are expected to boost sales in the second half of 2023.

The marketing effort behind the film has been magnificent, with social media campaigns, billboards, ‘pink carpet’ events and the appearance of a Barbie Dreamhouse in Malibu combining to make Barbie almost unavoidable in the summer so far. In the week leading up to its release, the Barbie Movie turned its Google search page pink and sparkly - a gimmick which has been shared millions of times online.

This marketing effort is not new, but a continuation of the work Kreiz has overseen in making Barbie more appealing to the masses. Doll sales began to recover in 2018 and hit an all time annual record of $1.7bn in 2021 - boosted by stay-at-home Covid trends. Barbie now accounts for a fifth of overall company sales and has helped the top line crawl back into growth territory.

The Barbie Movie is just the first in a long line of live action films for Mattel’s toys. The company plans to create a ‘multiverse’ of characters from its intellectual property. Film studios know that multiverses work. Mattel might have landed on its golden ticket for growth.