Marketing 18th Edition by William Pride,Ferrell

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Mattel Uses Market Segmentation to Stay on Top
In Mattel's toy chest, Barbie and Draculaura share space with Max Steel, Hot Wheels, American Girl, and Barney. The $6.4 billion company is the global market leader in toys, followed by Lego and Hasbro. Despite intense competition, Mattel wants to retain its market dominance and continue increasing both sales and profits. The toy company aims to stay on top through savvy marketing based on careful targeting and segmentation.
For example, Mattel sees significant revenue potential in targeting boys between the ages of 6 and 11, a customer group that's fascinated with superheroes. Mattel's research findings indicate that boys in this segment like watching videos, reading graphic novels, and playing videogames featuring favorite superheroes. These boys also like discovering new things about their superheroes and figuring out why and how these characters fight their foes.
Mattel targeted this group when it planned a U.S. relaunch of the action figure Max Steel, a superhero toy it has successfully marketed in South America for more than a decade. Max is a high school student who uses his superhero powers to save the world from monsters like Toxcon and Dredd. Months before the new toy appeared in U.S. stores, a Max Steel cartoon premiered on Disney cable channels and a Max Steel website began offering online tournaments, downloadable accessories, and other extras. By the time Max Steel figures and play sets arrived in stores for holiday giftgiving, boys were familiar with the superhero and his background-and were ready to put Max Steel on their wish lists.
The Monster High line of toys and accessories was created for the target market of girls between the ages of 6 and 12 who like vampire romances, zombie stories, and other trendy monster myths. Mattel researchers learned that these girls can be self-conscious about their looks. They're also thinking ahead to high school and to the fun but sometimes stressful school related social activities.
For this target market, Mattel created a line of unconventional-looking dolls, the children of monsters like Frankenstein. Each has her own personality and personal style, embodying the idea that girls can be attractive even when they don't fit the standard definition of beauty. Instead of Barbie's perfect face and dainty fashions, a Monster High doll has monster features (a werewolf's daughter has wolf ears, a vampire's daughter has prominent canine teeth) and dresses in appealing yet off-beat styles (monster platform shoes, Goth-style clothing). The target market responded so enthusiastically that Monster High products blossomed into a $1 billion business in less than three years.
Barbie's popularity peaked a few years ago, but the brand still has a lot of life left as Mattel refines its targeting to boost worldwide sales beyond $1.3 billion. In China, for example, Mattel originally emphasized Barbie's glamour when communicating with the target market of preteen girls. It opened a glitzy flagship store in Shanghai to showcase Barbie's fashions and accessories-and closed the store when sales fell short of expectations.
As a result of this experience, Mattel decided to take a fresh look at the other target market for dolls, parents and grandparents who buy toys for cherished girls in one-child families. This time, Mattel focused on gift-givers who have high educational aspirations for their daughters and granddaughters. It created new products like Violin Soloist Barbie and Baby Panda Care Barbie, dolls that are good-looking but also have a serious side (musical achievements, saving pandas). Combined with marketing changes to other Mattel brands and products, the company's new targeting strategy helped it to triple sales in China within three years.
Mattel recently decided to target Hispanic American mothers, a fast-growing, increasingly affluent market for all kinds of toys. Its research findings revealed that these mothers either make the buying decisions or are instrumental in the buying decisions for most household purchases. Furthermore, these mothers spend more than non-Hispanic American consumers when they shop for toys-and they tend to be brand-loyal.
Instead of simply translating its English advertisements into Spanish, Mattel dug deeper for cultural insights such as the importance of family and the celebration of Three Kings Day on the twelfth day after Christmas. Based on these findings, Mattel created the marketing theme of "Toy Feliz," meaning "Toy Happy," a twist on the Spanish phrase "Estoy feliz," meaning "I'm happy." Mattel tested the theme in cities with large Hispanic American populations. After the test produced positive results, Mattel began using the theme in television and print ads featuring Barbie, Hot Wheels cars, and other products in its portfolio. It also invited parents to download discount coupons from a special website. Based on the response, Mattel will give this high-potential target market even more marketing attention in the future.

Question for Discussion
Is Mattel using an undifferentiated, concentrated, or differentiated targeting strategy? How do you know?