Barbie seen poised for strong comeback-analysts

By Justin Grant

NEW YORK, Jan 30 (Reuters) - After enduring nearly five years of declining sales, Barbie is poised for a comeback in 2007, industry analysts said, with Mattel Inc. MAT.N rolling out sleek new products to revitalize the once-dominant brand.

In recent years, Barbie has been forced to compete for girls' attention with MGA Entertainment's pouty-lipped, street-smart, Bratz dolls.

Barbie has also seen her young fans flock to more high-tech items, such as iPods and video games.

But with new toys coming to market such as Chat Divas, a doll that can move and lip sync to music played on one of Apple Inc.'s (AAPL.O) iPod music players, Barbie's sales should continue to rebound in 2007, said Gerrick Johnson, an analyst with BMO Capital Markets.

"I've seen some of the new 2007 product that got onto shelves a little early at the end of 2006, and I liked what I saw," said Johnson. "I'm looking forward to seeing the rest of the line at toy fair." Since coming to market in 1959, Barbie has been a key component of Mattel's profits, and the company has made reinvigorating the brand one of its top priorities in the last year.

On Monday, Mattel said gross sales of its Barbie line rose 3 percent both domestically and worldwide, during the fourth quarter.

Mattel, the nation's largest toymaker, also figures to drive Barbie's sales with its Rainbow Adventure Elina Doll and DVD game. The doll functions as an interactive controller for the game.

Toys such as the Elina doll -- which manage to combine elements of electronics, fashion and music -- figure to be popular with today's tech-savy children, said Reyne Rice, a toy trends specialist with the Toy Industry Association. "That makes it all the more appealing to a kid, especially today's kids who have really grown up in a digital world and tend to expect some of the products to respond and work for them," Rice said.

Barbie's deal to be the face of Make-up Art Cosmetics'

(MAC) spring collection is another sign the doll is back on track as a global brand, Rice said.

The "Barbie Loves MAC" collection is scheduled for a March release and features Barbie-inspired make-ups and lipsticks.

The campaign also includes a special-edition doll that is styled and made-up by MAC, a move aimed at attracting older girls.

"They strengthened and bolstered their offerings to the older girl," said Rice, "making them a little more edgy, a little more trendy, a little more fun."

((Reporting by Justin Grant, editing by Gary Hill; Reuters Messaging: Justin.Grant.reuters.com.reuters.net; 646-223-6194)) Keywords: MATTEL BARBIE

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