Fisher – Price Toys, Inc.
...ly, yet who have some influence on the final buying decision. The buyers are generally parents (especially mothers) and it is to them that Fisher Price targets the bulk of its promotional efforts. Previous research suggests that the preschool toy customer’s main buying preferences are safety, quality, trust/loyalty and value for money – safety being the most important. Fisher Price’s market position is moving away from a supplier of inexpensive toys to that of a quality supplier. Buyers have facilitated this shift by becoming less sensitive to price. New purchases are more hedonic in nature with buying decisions being based on quality, safety and brand loyalty. Fisher Price is chosen more often than any other brand (83%) and is the most recognized brand (65%) in the industry. Competitors The largest competitors for Fisher Price are Playskool, Mattel and Creative Playthings. But the presence of small companies is gradually increasing. For example, in the category of Riding Toys Playskool is the market share leader, yet new entrants are eating into this market share. Challenge for Fisher Price The design department has created a new toy called the ATV Explorer whose child testing results are very attractive. Due to production limitations, the product cannot be released with a market price below the traditional Fisher Price $5 glass ceiling. The final retail price would be the highest ever for a Fisher Price product at $18.50. Determining the success of a product whose price is significantly higher than previous products is the dilemma faced by Fisher Price management. Previous experiences with higher priced products have been met with mixed results – although generally show positive customer reception. Below is an analysis of the advantages and disadvantages of the different options: Proposed solution Based on this risk analysis, options 3 and 6 are the most relevant. Since Fisher Price customers are becoming increasingly hedonistic in their buying behaviour, placing more importance on safety, quality and trust than on price, the company should promote these characteristics of its products and relaxing slightly its concern about maintaining low prices. The following should be Fish...