The inspiring and cautionary tale of Barbie's mom
By Robin Gerber
Ruth Handler, the founder of Mattel Toys and creator of Barbie, liked to say that she faced a ceiling of concrete, not glass. The tenth and last child of Polish Jewish immigrants, she married her shy, artistic high school sweetheart in 1938 and set off from Denver for Los Angeles. Seven years and two toddlers later, Ruth had rented a garage, borrowed money from relatives and banks and set out to sell the doll house furniture her husband Elliot designed.
Ultimate Risk-Taker
 Ruth understood her strengths and needs, saying she would have been the most unhappy and mixed-up woman in the world if she had stayed home with her children. She was the ultimate risk-taker; a gambler’s daughter who loved the adrenalin rush of making a sale. Mattel was a second-string toy company in 1955 when Ruth made the biggest gamble of all.
Walt Disney was about to start a new show called, “The Mickey Mouse Club.” He was looking for advertisers, but the commitment was for a full year and the cost was $500,000. Up to that time, toy companies did very little television advertising, preferring print ads that would run before Christmas. Ruth, however, recognized the potential of driving demand year-round. Even though the money required equaled the total net worth of Mattel, she agreed to the deal. Ruth’s gamble sent Mattel galloping toward her largest competitors in the all-male toy industry.
By the time Ruth brought Barbie to market in 1959, Mattel was the third biggest toy company in America. Ruth had pushed Barbie past the nay-sayers who said mothers would never buy their daughters a doll with breasts. Holding fast to one big idea, that little girls wanted to play at being big girls, Ruth marketed the doll as a fashion model, although her prototype was a German adult toy which she had found on a European family vacation. Mattel conquered Wall Street on Barbie’s tiny plastic back, going public in 1960.
Picking Herself Up
Mattel shareholders enjoyed double-digit returns for most of the 1960’s. But Ruth could not rest on her success. The same restless leadership instinct that fueled her rise, led to her downfall. Ruth began buying other companies with Mattel’s high-flying stock. In 1970, when sales and profits dropped, she conspired with other executives to falsify the company books to hide the losses from Wall Street. That same year she lost a breast to cancer, and along with it, her trademark vigor and tenacity. In a tragic downward spiral, Ruth was pushed out of Mattel in 1975, and three years later she pled guilty to criminal fraud receiving a long community service sentence.
As the nightmare of the 1970’s drew to a close, Ruth focused on what she knew best. She grew a new business making a breast prosthetic for women like her. As she had done with Mattel, she focused on her consumer. “Anything you do starts with identifying the consumer’s need and ends up with a product satisfying that need,” she told her staff. Ruth had personal experience with the humiliating treatment women received when they went to buy prosthetics. She also knew that the products on the market were lumpy and uncomfortable. Hiring a corps of other women with mastectomies, she traveled the country fitting her “Nearly Me” insert, the only natural looking prosthetic available at the time.
Ruth redeemed herself through entrepreneurship, and the rewards of direct service. In later years, young women in business often asked her advice. Always the raconteur, she was happy to talk about business and leadership. Ten years ago, during Barbie’s 40th anniversary celebration, Ruth sat at Mattel’s head table, again recognized as company founder and the inspiration behind the doll that became a global icon.
Sidebar: 4 Lessons from Ruth
What can business leaders learn from Ruth Handler’s story?
1. Make a product that you believe in, and make it the best.
Ruth considered her husband Elliot a genius. Her mission was to sell whatever he made. She not only found outlets for his creations, she organized production processes to support his vision. Rather than buying costly machinery, like most toy companies, and being tied to making certain kinds of toys, she used subcontractors. Her plan allowed Elliot to use varied materials and methods. Ruth was also a stickler for quality, never hesitating to stop production, despite the costs, if her standards were not met.
2. If you can’t handle risk, get out of the corner office.
Ruth came from a family of gamblers where her father died of a heart attack during one of his regular poker games. Perhaps that prepared her for the inevitable risk-taking of founding a business. In the early years, she had to beg and borrow from family and banks to raise the capital to get her toys to market. An original partner in Mattel, Matt Matson, could not handle the stress and quickly asked to be bought out. But Ruth reveled in the high wire game of betting that her sales and marketing skills would allow her to pay back creditors and build capital for Mattel’s next creation.
3. Visionaries don’t give up on their vision.
There would not be a Barbie doll if Ruth had listened to her critics, including her husband, who thought the doll was a terrible idea. She had a simple, profound insight about girls’ wanting to fantasize about being women and she would not be dissuaded. She hung on to her idea for years waiting for the right opportunity to make it a reality. Today, three Barbie dolls are sold every second in 140 countries around the world.
4. Don’t let success become the intoxicant that leads to disaster.
In the 1960’s, Mattel’s upward trajectory seemed unstoppable. It took twenty years for the company to reach $100 million in sales in 1965, but only three more to reach $200 million. As founder and functional CEO, Ruth had excelled in Mattel’s early years, but her skills were not suited to the company Mattel became after going public. After nearly a quarter century of success and expansion, Ruth lost sight of her mission. Her efforts to diversify by buying other companies, and to restructure Mattel’s organization were mostly disastrous. She failed to see or admit her weaknesses, instead trying to cover-up the company’s failure by committing fraud.
Resources
Barbie and Ruth: The Story of the World’s Most Famous Doll and the Woman Who Created Her (Harper, 2009) by Robin Gerber
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