In order to concentrate resources and energy to develop IoT toys, Mattel cut more than half of the dividends. The company said that focusing on e-commerce and repackaging its core brand of educational toys and connecting them to the Internet can strengthen its position in the market.
According to data provided by Euromonitor, Mattel currently accounts for approximately 2% of the Chinese toy market, lags behind Lego's 2.8%, but is ahead of Hasbro's 1%. Mattel has been reshaping its product line to develop artificial intelligence Barbie holograms, Hot Wheels hot wheels with smart sensors, and View-Master, an exclusive interactive virtual reality product for children, to make the company's products attractive. A generation of young parents.
Mattel said on Wednesday that the company's newly developed IoT toys will be available in the global market in the fall of 2018. “In China, there is a lot of awareness about linear learning and development. The market does need to develop emotional intelligence, primary motor skills and social emotional skills,†said Mattel CEO, Marta Georgiadis. George Yadis was a Google (microblogging) executive who just became CEO of Mattel in February this year. Mattel chose George Yadis because of her experience in technology and e-commerce.
Mattel also said that the company will set up a network of clubs in China's retail locations to sell toys for the joint venture between the company and Fosun Group. The joint venture is also the third major alliance after the alliance with Chinese companies such as Alibaba Group and Baby Tree to promote Mattel's educational products.
George Yadis told analysts in a conference call on Wednesday that she hopes to transform Mattel from a Barbie doll and a hot wheels toy maker to a vendor focused on mobile technology and events. This strategy will also cause Mattel to reduce its dividend to shareholders by 61%. “It’s time to reshape Mattel to make sure it reflects the direction of consumers and the market,†George Yadis told analysts. Mattel will transform from a traditional toy manufacturer to a “future experience company for children.â€
George Yadis said that Mattel brand toys need to adapt to the way children are raised today, because parents have become more and more dependent on iPad to educate children. She believes that this will bring great opportunities for digital content, IoT toys and products that promote children's learning. In addition, Mattel also wants to expand into games, lifestyles and other product categories.
In addition to lowering dividends, Mattel is also adjusting its supply chain and internal organization. Mattel believes that these initiatives will provide up to $350 million in funding for the company's growth strategy over the next few years and increase sales growth to 7% to 9%. Mattel expects the company's revenue growth this year will be between 0% and 4%.
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