Mattel Could Face Hurdle in Selling a Rival to LeapPad
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Mattel Inc., the world’s largest toy maker, is making a big leap into the electronic educational toy market, one of the toy industry’s fastest-growing segments.
On Sunday, the El Segundo-based company officially unveiled the PowerTouch Learning System for preschoolers at the 100th annual American International Toy Fair in New York.
Yet the new product line from Mattel’s Fisher-Price division may have a hard time taking sales from LeapFrog Enterprises Inc., whose LeapPad interactive book and other products dominate the preschool electronic-learning market.
Though Mattel may be playing catch-up with Leapfrog in some categories, the toy maker is known for educational products of its own, such as Fisher-Price’s See ‘n Say line. Demand for Kasey the Kinderbot has exceeded Mattel’s expectations since the company introduced the learning robot last year. It was the top-selling new learning toy last year, said Mattel, maker of Barbie dolls and Matchbox cars.
Unlike LeapPad, which requires the use of a stylus, PowerTouch lets preschoolers navigate by touching words and pictures displayed on the screen. It will sell for $49.99, about the same as LeapPad.
PowerTouch took 2 1/2 years to develop and represents one of the largest investments in a product in Fisher-Price’s 73-year history, said Jerry Perez, executive vice president of marketing and design at Fisher-Price.
LeapFrog plans to introduce its TogetherTime LeapPad for 6-to-36-month-olds that features finger touch, Chief Executive Michael Wood said.
Mattel and LeapFrog may both gain share in the electronic-learning market at the expense of smaller competitors, analysts said.
“They are going directly after each other,” said Jim Silver, publisher of ToyBook, a trade publication. “It’s going to be a battle.”
On Friday, shares of Mattel rose 36 cents to close at $20.86. Shares of LeapFrog, whose stock has risen 52% since the company went public in July, fell 26 cents to close at $19.74. Both trade on the New York Stock Exchange.
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