Mattel Stops Toying Around With Channel, Sells Direct

Written by Evan Schuman
October 28th, 2009

As major consumer goods manufacturers add more complexity to their Web sites, the temptation to abandon years of carefully orchestrated channel arrangements is intense. Despite futile resistance from retail partners, most of the largest CG manufacturers have started selling direct.

This week, Mattel–the $6 billion toy maker with brands including Hot Wheels, Matchbox, Barbie, American Girl, Fisher-Price and Tyco–joined those ranks and accepted channel conflict as it started selling directly through its Web site and social networking sites.

The latest move will unveil a major Facebook presence for Mattel on Friday (Oct. 30). But the heart of its package is its new Web site, launched in mid October. The site doesn’t include any capabilities that don’t already exist on other E-Commerce destinations, but Mattel has opted to tout three interesting features: ShopTogether, one effort to deploy group or shared shopping; ConciseClick, a rollover-and-click technique that sits above site videos and allows consumers to click in a very small number of places to get more info about products; and Play Pattern Navigation, which allows shoppers to navigate the site based on a child’s play behaviors.

Mattel already knew that parents were doing extensive online research before making purchases so it made sense to offer the purchase capabilities, said Michelle Chidoni, a Mattel spokesperson. But she said the channel conflict issues are minimal for two reasons. First, the toy maker has made sure that its pricing is not going to threaten any retail partners, which means products on Mattel’s site will be markedly higher priced in most cases. “We’re not severely discounting our products on our site. It is not a discount site so we’re not competing with [retailers] on price.”

Second, Mattel will have many ways that consumers can use the site to connect with local or otherwise desirable merchants. In other words, if the site is delivering a lot of new leads and customers to its retailers, those merchants are not likely to feel offended.

The next phase of the site, according to Chidoni, will have extensive customer-written product reviews, but she wouldn’t say when that phase is expected to launch.


One Comment | Read Mattel Stops Toying Around With Channel, Sells Direct

  1. Bryan Scott Larkin Says:

    If the pricing is significantly higher than retail, the site will definitely serve as a driver to other retailers – even online retailers. This will be similar to retailers touting “list price”. Retailers should like it.

    As a research tool, their idea on play patterns should be interesting to follow as is their ShopTogether idea.

    And if things go really well on the site and channels become more problematic, Mattel is prepared leverage the site for dirct sales via agressive pricing. Overall, it sounds like they are making a smart move.


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