Louis Marx and Company - The Fall of Marx

The Fall of Marx

The company slowly lost its preeminence from the 1950s on, perhaps due to not aggressively advertising on television as its rivals did. In 1955, with sales of US $50 million, Marx only spent $312.00 on advertising for the entire year (Time Magazine 1955). By contrast, Mattel Toys in the same year had sales of $6 Million but spent $500,000 for advertising, sponsoring shows like The Mickey Mouse Club (Clark 2007, p. 220).

In 1972, Marx sold his company to the Quaker Oats Company for $54 million ($246 Mil. in 2005 dollars) and retired at the age of 76 (Smith 2000, pp. 9–10). Quaker owned the Fisher-Price brand, but struggled with Marx. Quaker had hoped Marx and Fisher-Price would have synergy, but the companies' sales patterns were too different. Marx has also been faulted for largely ignoring the trend towards electronic toys in the early 1970s. In late 1975, Quaker closed the plants in Erie and Girard, and in early 1976, Quaker sold its struggling Marx division to the British conglomerate Dunbee-Combex-Marx, who had bought the former Marx UK subsidiary in 1967.

A downturn in the British economy in conjunction with high interest rates caused Dunbee-Combex-Marx to struggle, and these unfavorable market conditions caused a number of British toy manufacturers, including Dunbee-Combex-Marx, to collapse. By 1979 most U.S. operations were ceased, and by 1980 the last Marx plant closed in West Virginia (Vitello 2006). The Marx brand disappeared and Dunbee-Combex-Marx filed for bankruptcy. The Marx assets were liquidated in the early 1980s, with some trademarks and molding tools going to a few other toy manufacturers of the time, including the Mego Corporation.