by Robin Gerber
Ruth handled the downtime problem by reaching out for government money. Shortly after moving into their 60,000-square-foot plant in 1951, Ruth competed for a large contract to assemble complicated electric controls for army tanks. Her engineers retooled the equipment, and she met her million-dollar payroll despite toy orders slowing to a crawl after the flurry of Toy Fair. But she did not like it. Mattel had a brand and a mission, and that was toys. Any toy company that could figure out a year-round sales strategy would have a huge advantage over its competitors. She listened intently as Carson and Francis argued that twelve-month television advertising could increase and even out sales.
Everyone in the room that day also had a young family. The postwar baby boom was touched off by war veterans like Carson and his partner, Roberts. They and the Handlers recognized that the Depression and the world war had left families hungry to give children what they’d never had. And everyone agreed that Disney was a master at reaching children.
Francis took about half an hour to explain the idea. Elliot and Ruth listened with excitement. As soon as he was finished they turned to each other and agreed that the idea made sense, but Elliot suggested asking Yasuo Yoshida, Mattel’s controller, to give them his opinion of whether Mattel was financially able to commit to the deal. “Yas,” Ruth asked him when he joined the group, “if we spent a half million bucks on television, what do you think would happen if it didn’t work?” Yoshida took his time before answering, then offered that Mattel would sell more product. Ruth impatiently agreed but wanted to know what would happen if the advertising were not a great success. Would Mattel be broke? “I don’t think you would be broke,” Yoshida replied. “I think you would be badly bent.” His answer was good enough for Ruth to sign on to the plan. Less than an hour had passed since Carson and Francis had arrived. “It was the easiest sale ABC ever made,” Ruth said. She had committed half a million dollars, which was the entire net worth of Mattel.
Yoshida also pointed out that failure would mean a shaky credit record, but Ruth was not deterred. She instructed Carson to draw up a contract for three commercials. The first two were for longstanding products, the jack-in-the-box and the Cowboy Ge-tars, another popular crank music toy. The third commercial would introduce the new Burp Gun.
The Mickey Mouse Club was not set to air until October, but the Burp Gun had to be previewed at Toy Fair in March. Buyers had not seen anything like it. Not only did it look like a real submachine gun, it fired like one. Ruth had set up a 16-mm projector to play the commercial Carson/Roberts had put together for the toy. She and her sales reps ran through an enthusiastic explanation of Disney’s new Mickey Mouse Club concept and the advertising scheme. The television ads, they argued, would have the guns flying off shelves by Christmas. Mattel encouraged buyers to order their whole year’s inventory up front. It worked. Based on the success of Mattel’s other toys and the growing Disney brand, orders soared. For once, Ruth thought she would have a full year of production, even allowing for canceled orders. Instead, she ended up with chaos.
Due to the strong volume of orders, Mattel had heavy production schedules and shipped more product than usual, earlier than usual. Stores were full of Burp Guns, but they were not selling. The public did not know how to use the new toy. The television ads were not running yet, so consumers had yet to see the gun in action. Buyers started to panic as the toys sat on the shelves, and they began canceling future orders. Account representatives called Mattel, arguing that they had been shipped too many Burp Guns and wanted to send them back. Stores were canceling all of their September, October, and November orders, and Ruth panicked. She stopped production as quickly as she could, but Mattel still had large unsold quantities of the gun. “Things got pretty bleak around our place in the fall,” Ruth remembered. Hopes lifted at Mattel when The Mickey Mouse Club started in October and the first ads were on television. After the first week, however, sales were still down.
Each week, Ruth and Elliot watched The Mickey Mouse Club in dismay. They were proud of the commercial Carson/Roberts had developed for the Burp Gun. On screen, Cary Carson, Jack’s young son, stalks around the furniture in his living room, submachine gun at the ready. Rear-screen projection makes photos of herds of wild elephants appear on the walls, but when the boy fires his Burp Gun, the film runs backward and the elephants retreat. As he reloads, an announcer explains how the gun works and where the extra “ammunition” is stored. The advertisement invited every watching boy to hunt elephants in African jungles with “his trusty Mattel Toy Burp Gun.”
At the end of the commercial, Roberts tagged on a new logo: a cartoon of a boy with a crown on his head, waving from his seat in the center of the letter M. The tag line “You can tell it’s Mattel—it’s swell!” filled the screen as the announcer repeated the slogan. Ruth paid $2,500 for the ad, but it did not seem to do any good. The Mickey Mouse Club was a huge success, dominating its time slot, but Mattel’s toy sales were still in the tank. Carson/Roberts suggested taking out newspaper ads to remind parents to watch the Mattel television commercial. “It was a desperation move,” Cy Schneider, who worked at Carson/Roberts, said. “We started to believe the gamble had failed.”
Ruth was in a miserable mood as she left Mattel for the Thanksgiving holiday. When she returned, however, she said, “It was like the roof was going to blow off the place with excitement.” Over the holiday, after six weeks of television advertising, Burp Guns had flown off store shelves. Telephones were ringing, telegrams were arriving, and the mail began to fill with orders. Buyers were begging to reinstate canceled orders and to place new ones. Ruth’s staff tried calling the stores who had been pleading to be relieved of their stock, but they no longer had any guns. Like the other stores, they wanted to get more. It was too late to start up production, so employees raided the storage area for guns that had been rejected as not up to par. They were repaired and sent out.
President Dwight Eisenhower’s grandson David received one of the repaired guns at the White House. Mattel sent another to a California hospital where a journalist had promised it to a sick child. By Christmas Ruth had shipped one million Burp Guns at four dollars each, matching her entire previous year’s sales volume for all her toys. “By Christmas,” Ruth said, “there was not a Burp Gun in the country. That was the Mickey Mouse Club show. You can imagine how those buyers came prepared to our next Toy Show.”
As Mattel raked in the orders, Louis Marx, the founder and owner of the Marx Toy Company, the biggest toy company in America, appeared on the cover of Time. He declared that Marx toys had spent only $312 on advertising in the previous year. Toys just were not sold on television, and they never would be, he claimed. The story went on to describe other big toy companies and their sales strategy. Mattel was too small to be mentioned, but not for long.
Ruth not only changed a supply market to one that stirred demand, she changed the key consumer from parent to child. Toy advertising on television altered the family dynamic. No longer would parents buy only what they thought was best for their children. Over time, children’s opinions, shaped by television ads, would drive where parents spent their toy money. Years later, Elliot told Time, without apology, “We feel it’s up to the parents to handle the child.” It is unlikely that parents whose children were begging for toys they saw on television found comfort in Elliot’s pronouncement.
Retailers were also unhappy with Mattel. Ralph Carson told a reporter that retailers were irked because television advertising undercut their influence in the industry. The ads forced them to buy what Mattel advertised. “It used to be store buyers dictated what toys would sell, but Mattel reversed that.”
The sales power of television led Ruth to consider expanding the company’s on-air presence. By 1959 she asked Carson/Roberts to create a show called Matty’s Funday Funnies, a cartoon show hosted by the animated characters Matty Mattel and Sisterbelle. The show’s cartoons, Casper the Friendly Ghost, Little Audrey, Herman and Katnip, Baby Huey, and Buzzy the Crow, we
re huge hits, but Ruth was most delighted by the sponsorship deal she cut with ABC.
Normally, sponsorship contracts ran for thirteen or twenty-six weeks, and were renewed on October 1 of each year. Ruth, however, had negotiated a contract with ABC for fifty-two weeks in the Sunday 5 p.m. time slot. She insisted on the extra weeks so that the ads would be carried through Christmas. At the time the deal was signed, ABC’s chairman of the board and vice presidents were happy about the contract. Sunday afternoons were normally a hard sell. Their subordinates, however, were worried. Another bigger deal was being negotiated that might rely on the time slot Ruth had won. By the middle of the year, ABC realized their problem. Their big new show, Wide World of Sports, was set to run on Sunday afternoons starting in October, but Ruth was holding that time slot until the end of the year. Ruth’s contract was worth much less than that of the new show, and Carson called to tell her that ABC was willing to “do a lot” to get her to move to another day. “I was tough then,” Ruth said, “and I knew I had them just where I wanted them. We got Friday night primetime in trade for Sunday afternoon, and what a difference it made to us! And we got it at the same cost as the other, although it was normally so costly that we could not have afforded it.” The new television deal resulted in a major jump in sales.
Other toy companies began to copy Ruth’s aggressive use of television advertising, and as they did, advertisements on television changed toy development. Designers now had to consider how a new toy would look in commercials, and how to display it to highlight the differences from competitors’ toys. And the speed of television drove a major change in Ruth’s sales and manufacturing method.
Ruth became one of the first real experts at sales forecasting and control after analyzing the progress of Burp Gun sales. Never given to modesty, she called her post-television sales innovation “marketing genius.” In many ways she was right. “We were on the air six times and nothing happened,” remembered Ralph Carson. “Then the Mattel people came back from a long weekend and…the place was filled with orders and reorders. That was when we realized the pipeline in this business is six weeks long.” Why had it taken so long for Mattel to learn that the television commercials were driving sales? Ruth set her management team to investigate the problem. The answer was simple.
After a parent bought the toy, the sales information had to travel from the store to the jobber’s representative who sold to the store, to the factory representative who sold to the jobber, and finally to the manufacturer. In large chain stores such as Sears or Ben Franklin, the chain of communication was even more difficult to navigate. Ruth realized that she could not be dependent on those outside Mattel to get her timely sales information, so she hired a new set of employees, the “retail detail.” Their job was to travel around to stores, setting up attractive Mattel displays and measuring how fast Mattel toys were selling. If they saw a need for more toys or an overstock, they contacted the regional Mattel sales representative, who called the factory. Instead of a six-week lag time, Ruth now had sales data in a day or less.
Ruth’s genius lay not only in developing the method for collecting the data, but in analyzing the information to forecast sales and control production. Three years after the first Burp Gun commercial went on the air, Mattel had grown from four million dollars a year in sales to fourteen million. Marx Toy Company, with sales of fifty million dollars, was still far ahead. But not for long.
Chapter 9
The Woman and the Doll
I could only relate to them as a leader.
Most mornings, Ruth left the house in Beverlywood at eight fifteen, driving off with Elliot in her pink Thunderbird convertible. She still loved cars, and Mattel’s phenomenal success in television advertising in 1955 allowed her to indulge herself in what she chose to drive. Convertibles, among other products, had been imbued with a sexual cachet, thanks to the marketing genius of the psychologist and corporate consultant Ernest Dichter. He made a business out of analyzing people’s motivations to buy products, rather than diagnosing their neuroses.
Dichter had the broad, welcoming smile of a car salesman. With a deeply receding hairline accenting a high forehead, black-rimmed eyeglasses, and a neatly folded pocket handkerchief, he wore his intellectualism like a salable product. Dichter packaged himself as the answer to American retailers’ greatest question: how do we sell more product? Dichter sold himself to the American consulate in Vienna as an émigré who would transform American business practices, and he set out to prove his claim. Manufacturers eager to beat the competition gave Dichter large contracts for his unique skill.
Ruth first approached Dichter when Barbie was going through the design and production phase leading up to the 1959 Toy Fair. Besides her work on Barbie, Ruth sought ways to assess how Mattel toys were received. She knew parents had some concerns about Elliot’s toy guns, and there were strong critics inside Mattel who thought that going forward with the anatomically adult Barbie was a huge mistake. Ruth had lost track of the number of people who had told her that mothers would never buy the doll for their daughters. Television commercials were being prepared, and Ruth had to figure out how to position the doll to get past parental objections.
Ruth loved Dichter’s iconoclastic genius, along with what he promised. If Ruth’s fellow toymakers underestimated anything about her, and they often did, it was her competitive drive. She liked to win, and she intended to do so with the Barbie doll. Part of her strategy included bringing the guru of new marketing to Mattel’s aid.
Dichter was attracting enormous public attention as the evil genius who was the master of manipulated marketing. An inflammatory and influential book by Vance Packard, The Hidden Persuaders, had come out in 1957. The book’s cover copy, “The attempt to control our subconscious mind,” captured Packard’s central argument. His theme fit with the conspiracy theories of the time. Packard tapped into the angst of Americans who believed that communists might be holed up in government offices. Cold war hysteria had turned into paranoia, lending Packard credibility when he pointed his finger at Dichter as a purveyor of mind control.
Packard’s book succeeded in making Dichter not only more famous, but also more in demand by corporations. Ruth saw Dichter, like herself, as a rebel entrepreneur, unapologetic about ideas and methods that were outside accepted practice. He was a fellow groundbreaker, and her relationship with him would be another turning point for Mattel and for the toy industry.
A Viennese Jew, Dichter had set up his psychologist’s office across the street from Sigmund Freud, but fled the country in 1938 as the Fascist threat became intolerable. In one of his first assignments for his American employer, Compton Advertising, Dichter researched Ivory soap by conducting long, free-form interviews with a hundred people about their most recent experiences with soap. Besides these “depth interviews,” as Dichter called them, he would ask people to pretend they were a particular brand of soap, a “psychodrama” technique that helped him develop his idea that products had personality and images.
Dichter pioneered what would later commonly be called branding. His 1939 soap report concluded that Ivory soap “had more of a somber, utilitarian, thoroughly cleansing character than the more glamorous personalities of other soaps such as Cashmere Bouquet.” He went on to help market Chrysler cars with a similarly sexual slant. “Individuals project themselves into products. In buying a car they actually buy an extension of their own personality.” Sedans, he said, were like wives, “comfortable and safe,” but convertibles were like mistresses, “youthful, beckoning.” Dealerships quickly moved convertibles to the front window.
Influenced by his Freudian background, Dichter pioneered motivational research. He called it “qualitative research designed to uncover the consumer’s subconscious or hidden motivations that determine purchase behavior.” Armed with the certitude that he could uncover what others failed to see, he told the cigarette industry that consumers found in smoking oral satisfaction comparable to breastfeeding. Domineering and
always the center of attention, he pronounced that phallic-looking lipstick packaging was more attractive to women, and that necktie manufacturers should contrast an old, limp tie on an older man with a “smooth, colorful, erect and manly” tie on a younger man. He had hit on the idea of turning “sex into sales,” founding his own Institute for Motivational Research in 1946 in a castlelike mansion over the Hudson River.
When Mattel entered a market, Ruth believed, it had to be in a bigger, better, more explosive way than its competitors. She wanted Dichter to give her a marketing blueprint for Barbie. She also wanted to conduct a study on toy guns to convince the public that they did not promote violence in children. Willing to pay whatever it took to get the best talent, she agreed to a hefty twelve-thousand-dollar contract with Dichter’s consultancy for a report on Mattel’s toy guns, holsters, rockets, and the soon-to-be-unveiled Barbie doll.
Dichter was in such great demand that he could not handle every account. But he took Mattel for himself. No one had ever explored the motivations behind children’s choices of toys. Ruth later claimed that Dichter’s results about guns were “reassuring.” The 357 children he interviewed saw toy guns as props in make-believe games, and they liked the feel of the gun and its sounds. The gun was a “tool in the learning process.” But Ruth left out the more controversial parts of Dichter’s findings, although it is easy to imagine that they gave her a good laugh, considering the focus her all-male product development team had on making guns. “Big guns are like penises,” Dichter wrote, and children were relieving psychic tension as their knowledge and bodies were growing and experiencing the pressures of the adult world.
In analyzing Barbie, Dichter interviewed 191 girls and 45 mothers. He asked, is Barbie “a nice kid, friendly and loved by everyone, or is she vain and selfish, maybe even cheap? Does she have good taste or is she a little too flashy?” Mothers, it turned out, hated the doll, but not their daughters. “He interviewed girls about what they wanted in a doll,” Dichter’s wife said. “It turns out that what they wanted was someone sexy looking, someone that they wanted to grow up to be like. Long legs, big breasts, glamorous.”
