I was feeling pretty good this morning. BMO Capital financial analyst, Gerrick Johnson, had just released his analysis of the toy market in which he said: “We are particularly encouraged by the outlook for the toy industry, which looks stronger than it has in years.” He cited: “[B]etter innovation, a softening of the video game market, the emergence of "must-have" items, and an expansion of the retail channel” as the reasons.
In addition, he had very positive words for Mattel. Some of the reasons he cited were “…[A] better-performing toy industry overall…[Mattel’s] key brands (Barbie, Hot Wheels) are performing better and are in the early stages of cyclical growth...[and that] new products are performing better than expected (Monster High, Sing-a-ma-jigs, etc.).”
I was feeling really good…and then I read a breaking news release. At 8:00 AM Eastern time, that same Mattel announced that they were recalling 10.9 million Fisher-Price toys.
What a punch in the gut. Here is how Bloomberg News puts it:
The recalls are led by 7 million Fisher-Price tricycles, after 10 injuries were reported when children struck a protruding plastic “ignition key” on the toy… Fisher-Price also is recalling 2.8 million infant toys, including the Baby Playzone Crawl & Cruise, for choking hazards, the CPSC said.
The toymaker will recall 950,000 high chairs after reports of 14 injuries, including seven children who needed stitches and one treated for a tooth injury. The recalls also cover 100,000 toy cars with wheels that may detach, the agency said.
Mattel states that their toys are overwhelmingly safe…and they are. That, unfortunately, does not make much of a difference in a consumer marketplace that is just getting over the 2007 recalls and while the toy industry is fighting for more reasonable testing standards.
Unfortunately, as Bloomberg news points out, these recalls represent flaws in both design and manufacturing. The diversity of the products recalled makes the issue even more troubling, because the problems were found not among one product line, but across several -- toy cars, tricycles, infant toys and high chairs.
Mattel’s over-sized reputation in the toy industry means that they have a responsibility to both consumers and the toy industry to uphold the highest safety standards. Consumers undoubtedly think to themselves, “If Mattel’s toys are not safe, who can we trust?”
That is why it is good to see them moving quickly and sending out a clear message of concern and action while reminding the consuming public that Mattel toys (and all toys for that matter) are safe. All of us in the toy industry have a vested interest in Mattel cleaning this up as quickly as possible.