Fisher-priceis an American based company dealing with children’s toys. Foundedin 1930, Fisher-Price has been making quality toys making it theworld’s leader in toy industry. It is a Mattel owned brand thattargets children of up to the age of seven years. The company hasproduced over 5000 toys since its foundation. One of the mostrecognized lines of Fisher-Price is the Little People toys, which haspeople and animal figures with various sets such as farm, school,garage, house, and vehicles. The figures that were once wooden arenow plastic molded. Other popular toys and toy brands include viewmaster, power wheels, chatter telephone among others. Currently, thecompany is producing electronic toys for children. Amidst the greatcompetition from other toy companies, Fisher-Price has managed tolead for several years. However, it should be noted that thecompetition is stiff as other competitors come up with creative andquality toys. As such, Fisher-Price should strive to stay ahead tomaintain its position in the competitive toy industry. The companyneeds to evaluate its strategy to identify its effectiveness in thecompetitive business world.
Fisher-Priceis a well established toy brand internationally. It operates in acompetitive environment where technological advancements are changingthe nature of the toy industry. Being a leader and maintaining thesame position for years has not been easy considering that there aremany large and small scale toy companies all over the world. Tocompete effectively with other rivals, the company has used variousstrategies such as effective marketing strategies, invention in supertechnology, and producing a diverse range of products.
Analysisof the business environment
Fisher-PriceCompany operates in a highly competitive market. With several toycompanies competing to produce the best toys and take over themarket, it makes it harder for companies to appeal to consumers. Thecompetition in this industry is primarily based on value, price, andquality of toys. Fisher-Price offers a diverse range of toys forchildren including girls’ toys, boys’ toys, toys for infants,educational toys, fashion related toys, games, puzzles and mediadriven toys. Competition in the toy industry has intensified due tothe recent trends of shorter life cycles for toy products and anincreasing use of sophisticated technology in toys. Likewise, littlechildren are outgrowing their toys at a much younger age. It is alsonotable that the small retailers contribute to a significant numberof toys. They have an added advantage because they have a directcontact with parents and children through coupons and in storepurchases. Such companies are able to promote their own products,allocate their shelf space and facilitate the sale of their toys. Theemergence of many small companies is easy because the barrier toentry is low. New companies and entrepreneurs continually createproducts that attract the attention of children (Kline, 1993, 115).Further, other Mattel brands are competing with Fisher price. Eventhough, it is still leading in Mattel Inc.
Additionally,many well known brands spend a lot of money and resources in researchand development that allows them to come up with new and creativeproducts. In this era of information technology, many electronic toysare taking the place of other plastic and wooden toys. In thistechnological era, children have become more accustomed to electronicand more creative toys, which have become more common in the streets.Things such as computer games are also overtaking the normal toysthat children used to have. They have become accustomed to electronicor computer games that are offered at a fair price. As children grow,they tend to neglect the plastic toys much faster than ever before.Likewise, children of today are also learning about cell phones muchearlier than before. They are beginning to use cell phones at a verytender age. Having in mind that cell phones have many features suchas games that attract children, they are likely to do away with theirother toys. These devices are offering several forms of entertainmentfor a little cost if not free. This poses a great risk on the toyindustry, including Fisher-Price. The prices of cell phones andrelated electronics have experienced a drastic decrease in price overtime thus, more accessible to many families and children equally. Tocompete with these devices, Fisher-Price must be willing to spend asignificant amount of money and resources to compete with inventions.In turn, creation of these toys leads to lower profit margins and thecompanies need to sell more units of the product to maintain theprofits of the company. Children are expecting more simulation fromtheir toys than ever before so as to capture their attention. It islike the children are getting older, younger (Pecora, 2002, 69).
Fisher-Pricebusiness is seasonal as consumers purchase large percentage of toysduring the traditional holiday season. A significant number ofcustomers purchase the company’s products in the third and fourthquarters of the company’s fiscal year with reference to holidaybuying. The seasonal purchases of the company may lead tooverproduction or underproduction of toys for various seasons.Fisher-Price may not be able to meet the demands of the customersduring the peak season. Seasonal consumers also mean that the companyhas less production of toys during off peak hence, reduced profits.
Fisher-priceis a highly recognized toy company all the world. It has venturedinto several international countries in an effort to increase itsprofit. Its brand name is well established and attracts customers allover the world. Having a good relationship with customers globally isa great advantage that places the company in a competitive advantage(Osterman, 2007, 138). It means that it is able to sell more piecesin various parts of the world thus, more profit and a strong brandname. Having its customers in the global market has given the companya strong financial stand. As such, it has a competitive advantageover other small scale companies that are still struggling. This alsomeans that the company can be able to invest in new technology in theface of the digital world. It has also been able to produce differenttoys that meet the demands of versatile customers. The companyreaches a wide variety of customers in different ethnic backgrounds.
Fisher-Priceproducts are designed specifically for children. Its products are atotal hit for children making it a leading company that receivesseveral awards that gives consumers an idea of how the product iswith reference to durability, safety, and quality of the products. Anaward has a positive outlook in the world market (Paley, 2006, 87).It attracts more customers because they gain trust in such a companythat receives an award. Fisher-Price does not only focus on children,but also on the parents. They realize that parents are the coredecision makers of their children hence, targeting them increasesthe sales significantly. It does this by collaborating with mothersof the digital world. The company identifies the needs of the mothersthrough interviews and other platforms. This has helped to identifywhat mothers want for their children and why they prefer certain toysto others. Reaching unto mothers has helped greatly because they arethe biggest decision makers for their children. Their tastes have agreat impact on the toy they select for their children before theycan make their own. For instance, a one year child has littleinfluence on buying toys. Parents only rely on their tastes byfiguring out what their children may like. As such, they end upbuying what attracts them. Therefore, it was a wise decision toconnect with the digital mothers to ascertain their tastes of toysand what they think would attract their children.
Fisher-PriceCompany has an effective marketing strategy. Marketing is a greattool of boosting sales for every company that wishes to survive inthis competitive world of business. Fisher-Price ensures that itmarkets its products globally and in the most appealing of ways. Dueto its financial stand, it is able to invest a substantial amount ofmoney in marketing. It uses media to market its products in anattractive way. It also uses celebrities with their children to makethe products and attractive to customers. Currently, the company haspartnered with Shakira, a popular female musician, to promoteFisher-Price toys. This has attracted a lot of customers becauseShakira is a public figure who is adored. Therefore, mothers arelikely to get attracted to the brand that is also favored by acelebrity. They feel that what is good for Shakira is also excellentfor them. The use public figure in marketing products has long beenrecognized as a strategic method of attracting more customers(Saxena, 2006, 86). In addition to celebrity marketing, the companyhas many fliers and billboards in several places to capture theattention of the target market. It has also established its marketingin radio and televisions. It pays a significant amount of money toTVs to ensure that their advertisements are played during the peakhours when many people are watching. The advertisements are made inan appealing way that attracts both children and their mothers.Likewise, Fisher-Price also promotes its products by using anattractive display in the shelves of the major shops andsupermarkets. The display is such that it attracts children andmother walking along the major retail shops. The company’s entiremarketing strategy, especially through media, has helped it inattaining a competitive advantage of other toy companies.
Acompany that was founded in 1930 has survived all these years becauseof it has been able to keep up with the progressive advances intechnology and invention. For a company to survive several years inthe market, it must be able to keep pace with the technologicaladvancements and new demands in relation to the demands of consumers.Fisher-Price has been keeping pace with the innovations in theindustry hence, its ability to survive and maintain a leadingposition for many years. It has advanced from wooded toys to plasticmolded toys that are highly valued by customers. The toys that wereonce simple have been replaced with more sophisticated ones. Thesmall car toys that had to be moved now apply a technology so thatthey can move a small distance on their own. While otherentrepreneurs and companies are also inventing new toys, Fisher-Priceis still ahead of many in inventions. As more and more toy companiescrop up and the existing ones try to invent better toys, Fisher-Pricehas worked extra hard to ensure that it survives the market andretain its profits. The products that it produces year is moreinnovative and sophisticated than the previous ones. This shows thatthe company is continually inventing new products that meet thedemands of the children and mothers.
Recently,Fisher-Price Company has begun producing electronic toys. Thisstrategy is effective in meeting the needs of today’s customers ofthe digital world. It is worth noting that the children of today areusing the digital technology very early in life. They are shiftingtheir efforts to create electronic toys for infants and preschoolers.This is crucial for the world that is slowly migrating to digitaltechnology. Even the parents are encouraging their children to usethese advances, which draws much attention. This realization has ledto creation of electronics that are currently dominating the toyindustry. Children have begun using mobile phones at a very tenderage. Likewise, simple video games attract a large number of childrenwho now view plastic and wooden toys as outdated. This is more so infamilies that can afford some comfort for their children. However,this does not mean that the company has stopped producing plastictoys. In fact, plastic toys still make the highest percentage ofproducts that the company produces. Its shift to electronics is onlymeant to diversify the company’s products to reach a wider market.The company ensures that it reaches both the customers of the plasticand digital toys. This strategy will help it to stay ahead of thegame.
Currentand future trends
Thecurrent market of toy industry is volatile. Technologicaladvancements have kept toy companies on their toes in thiscompetitive business world. The companies that have invested theirresources in research and development are the ones that will survivethis market. The shift in electronics from toys means that toycompanies have a lot to do (Kline, Dyer-witheford & De Peuter,2003, 78). Fortunately for Fisher-Price Company, it has been able toinvest in electronics toys that are taking the market of toys. Thecompany is working extra hard to ensure that it keeps up with thepace of the digital world. It is still ahead of the game in themarket of toys. Despite the great competition from other toy andelectronic companies, Fisher-Price is still on top. Its brand namecontinues to storm the international market of toys.
However,the future of market of toys is uncertain. With the rate at whichparents are exposing their children to digital technology, there is ahigh likelihood that normal toys are going to lose their place in thefuture market. Electronics are increasingly becoming more affordableand with varied features of entertainments that have taken away theattention of most mothers and children. Children can become addictedto video games and cartoons, but it is unlikely for them to becomeaddicted to plastic toys. Although at first they may seementhusiastic about a new toy, they easily get bored especially forthose with access to various forms of electronic entertainment. Assuch, Fisher-Price should increase its resources to electronicentertainment lest it encounters a drop in profits in the futurewhere it is predicted that the demand for plastic toys will havedecreased.
Thestrategic management of Fisher-Price is effective the reason it isstill leading in toy industry. Despite the challenges it is facing inthe light of competition it has stood strong and unshaken. Theentire strategy of the company is effective in fighting offcompetition. It has stayed ahead in technology and marketing. Itoften produces new and more sophisticated toys to keep pace withother competitors. Its well recognized brand name and strongfinancial support has also helped the company in competing withothers successfully. Further, Fisher-Price is currently producingelectronics toys that continually dominate the toy industry. Thismeans that it is likely to survive in the future where digitaltechnology will have taken market by storm (Scott, 2010, 126). Thefuture of plastic and wooden toys is jeopardized in the light of themodern technology. Fisher-Price is a company whose strategicmanagement has helped in staying ahead of other rivals in the toyindustry.
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