Business Excellence Awards
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By Matt Townsend
By Matt Townsend
NEW YORK – Shortly after joining toymaker Hasbro Inc. more than a decade ago, Brian Goldner took his 5- year-old daughter Brooke on a tour of headquarters. She wasn’t impressed.
“She put her hands on her hips and said, ‘Dad, the way I see it, you don’t have any toys for girls,’” Goldner, who was promoted to CEO in 2008, said in an interview. Her candor only reinforced what Goldner already knew: Hasbro didn’t understand how girls played and what they wanted.
Much has changed since then. Thanks to improved consumer research and revived brands such as My Little Pony, Hasbro has found success beyond its boy-focused Transformers and Star Wars toys while making inroads on Mattel Inc., which is considered the dominant girls-toy maker because of its Barbie and American Girl dolls.
Hasbro last week said revenue from the girls division rose 26 percent in 2013, topping $1 billion for the first time and more than tripling its $300 million in 2003 sales. That helped make up for a 22 percent decline in sales from the boys unit last year. Companywide sales were little changed at $4.08 billion.
“The girls business is the strongest part of the company, and 10 years ago they were not really considered a player,” Sean McGowan, an analyst at Needham & Co. in New York, said in an interview. He recommends buying the shares.
The girls unit may ease volatility in Hasbro’s results because boys sales rely more on tie-ins to studio films that can vary in number and quality each year, McGowan said. That’s partly why boys sales fell in 2013, he said. Girls also may help Hasbro as the toy industry, especially in the U.S., fights to win kids’ attention in an era of mobile devices. U.S. toy sales fell 1 percent last year, according to researcher NPD Group.
Hasbro’s turnaround with girls started with the My Little Pony line. The brand, backed by a popular animated series, had been an important part of the company’s success in the 1980s. By the late 1990s, My Little Pony languished and Hasbro eventually shelved it.