Mattel names new CEO
The El Segundo toy maker taps a Google executive as its new chief executive, a sign that the company is going all in on tech.
Mattel Inc. tapped a Google executive as its new chief executive, a sign that the company is going all in on technology as the future of its toys.
Margaret Georgiadis is taking over the helm of the El Segundo company Feb. 8. She is replacing Christopher Sinclair, who was CEO for two years and will now serve as executive chairman.
With its new CEO, Mattel is showing a willingness to look outside the industry for a leader with digital experience, analysts said. Toy makers are grappling with how to keep the attention of tech-savvy kids whose phones and tablet computers are loaded with games.
“Online is really important for toys,” said Linda Bolton Weiser, senior analyst at B. Riley & Co. “Having that online capability both in terms of conveying content and hooking up with consumers” will be increasingly important.
Georgiadis is stepping in the midst of a turnaround at Mattel. After several years of lackluster performance, Mattel has been rolling out new products and overhauling its corporate culture, which has been criticized for red tape and bureaucracy. Sales have revived for key brands such as Barbie, Fisher-Price and American Girl.
Sinclair said Tuesday that Mattel has been “dramatically transformed” in the last two years. He lauded Georgiadis’ experience in building brands and engaging consumers “in a rapidly changing digital world.”
Georgiadis worked at Google for eight years. Since 2011, she has served as president of Americas, responsible for Google’s advertising sales in the U.S., Canada and Latin America. From 2009 to 2011, she led the sales technology teams in expanding businesses such as Google Wallet. She has also worked as chief operating officer of Groupon and was a partner at consulting firm McKinsey & Co.
Philipp Schindler, Google’s chief business officer, said Georgiadis “helped create terrific momentum for our business.”
“Under her leadership, we’ve built incredibly close relationships with our partners across the Americas,” he said Tuesday.
Analysts said she could bring a technology native’s perspective to a business that is still largely composed of physical playthings but ever more dependent on the Web to market and sell its products.
Toy makers are increasingly tied to entertainment — hit movies and TV shows can correspond to huge sales for related playthings. Many companies now try to expand a toy’s popularity by launching videos on platforms such as YouTube or Netflix.
Mattel has also said it plans to expand its own online sales by nurturing its brands, said Weiser, the analyst. In the toy category overall, about 15% of toys and 20% of baby gear is sold online today, she said, and that’s only expected to rise.
Analysts said Georgiadis could bring urgency to Mattel on the online front.
“She brings a digital background that a lot of people are probably looking for,” said Jaime Katz, an equity analyst at Morningstar. “Mattel hadn’t really focused on that in the past.”
In the last two years, the toy maker has instead focused on reviving its business.
Under Richard Dickson, its chief operating officer, Mattel has rolled out new products that cater to an increasingly diverse customer base. Last year, the toy maker introduced three new body types for Barbie — petite, curvy and tall — and seven new skin tones to better reflect the diversity of women. The company opened American Girl mini-shops inside many Toys R Us locations in an attempt to reach shoppers beyond its own stores.
Mattel also created Toy Box, a division intended to foster innovation and risktaking within the company (an upgraded augmented reality version of the classic ViewMaster is one of its achievements).
Sinclair and Dickson also hired new executives on both the creative and business sides. Those efforts have energized sales at its core brands including Barbie, Fisher-Price and American Girl.
“They are sort of in the fourth or fifth inning,” Weiser said. The turnaround is “not really completed yet, but they have managed to stabilize sales.”
Some industry experts had predicted that Dickson would get the top job after Sinclair stepped down. He has been credited with reviving Mattel’s creative energy and many had viewed him as the heir apparent.
Weiser, who was surprised that Mattel bypassed Dickson, said the board may have deemed digital simply too crucial to the company’s long-term success.
“It’s a recognition that a toy company is about content, about communicating with consumers online, and about e-commerce,” she said.