Mattel SWOT and PESTLE Analysis

Strength

1. Strong brand portfolio and licensing agreements: Mattel has a wide range of popular brands under its name, Barbie® and Hot Wheels® being the most popular ones. Fisher-Price, one of Mattel’s child companies, is the creator of popular toy lines such as Little People™, Laugh & Learn™ and Discover ‘n Grow™. American Girl®, subsidiary of Mattel, is engaged in making premium-quality books, dolls, clothes, toys, and accessories that foster girls’ individuality, intellectual curiosity, and imagination. HIT Entertainment, another subsidiary of Mattel, has brands like Thomas & Friends®, Mike the Knight™, Fireman Sam®, Bob the Builder, Barney®, Angelina Ballerina®, Pingu® and Rainbow Magic® under its name. Apart from this, the company also has ongoing multiyear deal with Warner Bros. which gives it right to develop toys based on its popular DC comics characters like Batman, Superman, Wonder Woman, The Flash etc. Aquaman toys being the most recent one. Others include EnchanTimals, Jurassic World, DC Superhero Girls, Monster High, Matchbox, and Cars to name a few. A partnership with Warner Bros. Pictures Group is underway which will allow the company to take the iconic Hot Wheels, a toy racing car to the big screens with the production of an action filled feature film for the franchise.

2. Highly-diversified sales mix both by brand and by region: One of the biggest strengths of Mattel is that it has diversified product mix not just by large brand portfolio that it has but by sales mix as well. Mattel categorizes its sales by the brands and by the regions in which it those sales take place. In terms of actual sales, its power brands consisting of Fisher-Price and Thomas & Friends, Barbie, Hot Wheels contributed to $3,875.8 million till 31st December 2021. Barbie product billings increased by 18 percent, primarily as a result of strong brand momentum and point-of-sale demand (POS), and Spirit product billings increased by 3 percent. Overall, doll gross billings increased by 22 percent. Gross billings for infant, toddler, and preschool products increased by 6%, driven primarily by higher billings for Thomas & Friends and Fisher-Price products for newborns and infants. Gross billings for vehicles increased by 13%, of which 10% was attributable to higher billings for Hot Wheels products, which were boosted by POS and in-store impulse purchases. Action Figures, Building Sets, Games, and Other gross billings increased by 32 percent, of which higher billings for Jurassic World accounted for 12 percent, Masters of the Universe's initial billings accounted for 10 percent, and higher billings for Plush accounted for 6 percent. Although the majority of sales proportion came from North American region with 58% of its sales, sales from other regions accounted for the remaining 42%. Sales by region are diversified and this serves as one of the important strengths because it ensures that the company has expanded reach across the globe.

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Weakness

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Opportunity

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Threat

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Political

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Economic

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Social

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Technological

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Legal

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Environmental

1. Initiatives to reduce plastic as well as recycle toy materials: Businesses are increasingly taking initiatives to reduce plastics across its operations as well as recycle and reuse the materials used. By 2030, Mattel wants to cut the amount of plastic packaging used for each of its products by 25%. As part of its packaging strategy and reduction approach, Mattel is concentrating on reducing plastic materials from product packaging, such as polybags, window sheets, and blister packs. In most window cartons and blister packs, the company has increased the percentage of recycled PET (polyethylene terephthalate) from 25% in 2020 to 30% in 2021. Additionally, in 2021, it achieved a 79 percent waste diversion rate. Fisher-Price toys are now a part of Mattel's Mattel PlayBack programme. In the toy takeback programme, which enables families to prolong the life of their Mattel toys after they are finished playing with them, Fisher-Price joins Barbie, MEGA, and Matchboxbrands. The new initiative aims to prevent materials from ending up in landfills by recovering and reusing them in new Mattel products. It also helps the company reach its 2030 target of using only recycled, recyclable, or bio-based plastic in all of its products and packaging.

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