Mattel’s failure in China

Author: Shrayansh Agarwal

Abstract: American toymaker Mattel closed its first flagship Barbie store – the House of Barbie – in Shanghai
after two years struggling since opening in 2009. An investment of over $30 million was made in the House of Barbie
for celebration of the American iconic doll's 50th anniversary.
Mattel had been a very reputed toy brand in America. But it's business failure in china was a big shock.
This paper aims at presenting the principal causes of this failure. The research paper primarily focuses on the
cultural differences and differences in the two ideologies that were significant causes of the massive failure. The
article also presents a conclusion at the end that summarizes the reasons discussed. Lastly, it also suggests some
alternatives and solutions that could have prevented such a colossal failure for Mattel. The work has been done by
reading various case studies and analyzing cultural differences between the two nations. The research is mainly
concerning to Hofstede's and Trompenaars’s cultural dimensions.

Keyword: Feminine, Fashion icon, Business, Culture and Traditions

I. INTRODUCTION
Mattel, is an American multinational toy manufacturing company founded in 1945 with headquarters in California. The
products it produces include Fisher-Price, Barbie, and many more. Mattel had a great success for its Barbie dolls in the
USA. It thus expanded it to China in 2009. However, the store had to be closed down in March 2011 just two years, and
Mattel suffered a significant loss of Thirty Million UD dollars. This was one of the greatest business failures in the history
of United States.

II. REASONS OF THE FAILURE

The critical reason for this failure is the cultural differences between the two nations. One main reason for Mattel was not
successful in China was that it did not understand the differences between American and Chinese girls, particularly
between their perception and culture. The aggressive and “sexy” image that Americans associated with Barbie was at odds
with the Chinese who desired sweet and soft. The clothes and accessories were appealing but held little cultural
significance for young girls who were immersed in Chinese stories and culture. Mattel blindly tried to establish its
American model to the Chinese market. For example, it released a Butterfly Art Barbie, which had permanent tattoos on
her abdomen and a pregnant doll who had an infant that was detachable from her midsection. These dolls had successful
sales in the United States. However, Mattel failed to understand that while Barbie was a known brand in America, it was
not the same in China. The Chinese criticized this model, and Mattel’s reputation suffered drastically.
Also, the store was on Shanghai’s Huaihai Road, which was one of the most expensive streets. Thus people refrained
from spending such a large sum of money on products like Barbie dolls. Thus the store was considered a place for the
rich, and china’s economy did not support enough riches.
Also, the store intended to launch Barbie as a lifestyle brand, rather than just a little doll, but it was not so much a shop as
a lifestyle concept. The Shangai, massive store was not only aiming at children, but Mattel was marketing the Barbie
lifestyle to women in their 20s.It was, again, a cultural mismatch between the two nations. In America, women are more
straight forward, whereas in China, they are more traditional. China is a country with a high masculinity score than the
united states, and thus such fancy and strong portrayed barbie dolls were opposed and discouraged
Another mistake that Mattel made was to have a standalone store before making Barbie a strong brand in China. In
America, Barbie has always been an iconic symbol of “femininity” for young girls. Over fifty years, in the United States,
the brand has taken a famous name of its own as Barbie and portrayed many roles of women. However, in China, Barbie
is just a doll. She is not associated or linked with any cultural significance or importance for Chinese girls or young
women. Since Barbie is not a very big cultural icon in China as she is in America, Chinese consumers cared less about
Barbie-branded products. The Barbie fashion clothes for young women would only make sense if Barbie is a cultural icon
and established lifestyle brand.
One of the reasons for the downfall of "The house of Barbie" in China is that China is a nation with a high power distance
score (About 80). Thus anything such a female was opposed and not accepted by the people of china. They did not
understand the real concept of the barbie doll and misunderstood it as symbols of feminity. On the other hand, America
has a low power distance score (About 40), which allows people to think more liberally and accept barbie dolls as simple
toys for their children.
Another major problem that occurred was that China is an ascription based culture, and the United States was an
achievement-based culture. Thus Chinese believed in preserving faces and judged things considering their family
background, in this case, the past reputation and history of barbie dolls. It again posed a problem as the barbie portrayed
modern women and did not resemble any such background. Thus the Chinese could not accept it as a part of their culture.
Due to which they did not want their children to play with toys that did not resemble or match their ideas. China is a
collectivist country. People in China believe that the identity of the person is based on the group he or she belongs. On the
contrary, America is an individualistic nation and believes that individuals are loose, and identity is unique and does not
depend on the group. Thus most of the barbie dolls were alone, and no concept of family was depicted. Thus the Chinese
could not again relate it to themselves and their living. Thus barbie failed to maintain any particular identity and was less
preferred over the other dolls.

III. SOLUTIONS

Barbie could have mastered the Chinese markets as well if it took care of the cultural differences between the two nations
in consideration. Making the dolls more specific to the Chinese traditions and culture is the key. They did launch a barbie
that had a resemblance to Chinese dresses, but that was not enough. It was just a weak cover to the big problem. Mattel has
to enter the Chinese market with a new strategy now if it wishes to conquer the chines market again. It should first launch
Barbie as a brand before having large standalone stores. It can do that by having smaller shops in many streets of shanghai.
It should just note that the streets are not too expensive for the local people to buy. It should note the fact that initially,
Barbie would be a little toy doll to Chinese and have no particular meaning to them as it were in the united states. So Mattel
should first focus on making it a brand in China. It should understand that Barbie is not any cultural icon in China. Barbie
dolls are less relatable to Chinese culture. Thus Barbie should be more specific to china. It can be done by introducing more
family-based toy sets. Also, Mattel should not portray Barbie as an extreme and fashion- icon girl. Instead, make it a simple
and sweet girl. An educational campaign can also boost sales revenue. An educational camp will be taken as an activity for
the children, and people will appreciate it. Moreover, children will also develop a craze for Barbie and eventually Barbie
will establish itself as a brand. Mattel should also consider having Chinese staff in the stores and operate the store in a way
acceptable in china. It should give the task of designing the dolls to a person who has more excellent and sound knowledge
of the culture and traditions in china. It would be advisable if the hired person is Chinese and the manufacturing units are
also near shanghai.

IV. CONCLUSION

In China, Barbie is a doll. She is not associated with any Chinese culture for young Asian women. Since the Barbie has no
cultural significance for the Asians, they could not care less about buying a cheap plastic doll. Plus, Mattel had a profound
understanding of what the Chinese buyers wanted. Although they did create a Chinese doll called ling, who wore cultural
clothing, it was not what they wanted. Many foreign companies assume that urban Chinese customers appear quite
westernized in their outward appearance. They will readily accept western concepts, products, and services. However, this
ideology does not apply in all instances and certainly not at places where the Chinese culture comes to play. China is a
country that is very strict in its cultural norms, and they cherish it. Thus Mattel did not understand this significant aspect
and lost thirty million US dollar. In China, the feminine is considered to be sweet, gentle, and loving. Whereas in Mattel's
Barbie, it is portrayed to be a smart, strong, dashing, and fashion-forward girl. The location of the store was also a factor as
it was on the most expensive street of Shanghai, and thus people refrained from buying such expensive toys. It mattered
less to them if the toy their children play with was an authentic barbie doll or a copy piece. Moreover, a single standalone
store did not attract many people from more considerable distances as they considered it a waste of money and resources to
travel and visit an expensive barbie toy store. The store also did not make its concept very clear. It tried to mimic the western
world through Chinese culture but failed drastically in that and thus ended in depicting a very different outlook to the
Chinese, which was not very well welcomed by them.
 REFERENCES

[1]. The Forbes Magazine article “ Why Barbie stumbled in China” by Helen H. Wang
[2]. “Mattel and cultural issues” by The north Central academy.
[3]. “ What went wrong with Barbie” by Helen Wang
[4]. “Mattel in China” by Yana Cherepashenskaya
[5]. “ Why did Mattel fail” by Rundle College High School
[6]. “Mattel Case Study Analysis” by Dr. DiMatteo-Gibson form the Kalpan University.
[7]. “ Hofstede Insights” by Greet Hofteste.