Apps & Software

Why Americans Have Stopped Buying Barbie

Update: Mattel’s shares have fallen as much as 3% today to $36.50 which matches the company’s 52-week low. The 52-week high was $48.48

Sales of Barbie, the popular doll franchise started in 1959, fell 13% in the fourth quarter. Holiday demand for Barbie is critical to parent Mattel Inc. (NYSE: MAT), shares of which paid the price for the fall off.

Mattel’s fourth-quarter sales dropped 6% to $2.11 billion. For the year, revenue was flat at $6.48 billion. For all intents and purposes, the huge toy company is stuck in neutral.

Mattel did not give a reason for the sharp drop in Barbie sales. However, several developments in the way that children spend their time could be ongoing culprits.

Barbie’s largest weakness is probably that it is still a “toy” in a world where children spend hours with interactive games, texting and participating in social networks. The major attraction of Barbie has stayed mostly the same over the decades. The doll has a closet full of outfits and beauty products, which is not much compared to the hundreds of games that youngsters play on smartphones and tablets.

Depending on the study, Americans spend 10% to 15% of their waking hours online. It is generally assumed that this figure is higher among young people than older ones who grew up in a period before Facebook and Twitter. The migration of people to the use of portable devices in no less impressive. Nearly 300 million Americans have wireless subscriptions. As superfast 4G networks proliferate, the abilities of these devices as multimedia platforms and game devices grow.

Some of the most downloaded free apps are aimed at girls. Among them is Covet Fashion, an online dress up game. Another is Eye Make Up Salon, an app that lets girls prepare themselves for a variety of “parties.” Not only are these games interactive, they do not require a trip to a store and the price of traditional toy.

Barbie has begun to die off, and if there is a single major culprit it is that there are better “toys” for young girls online that they can play with as they spend hour after hour on Facebook while texting.