The fluffy toy Labubu caused a global sensation, transforming the Chinese company Pop Mart into one of the global toy market leaders with almost 2 billion dollars in annual sales. Pop Mart's market capitalization is already twice the combined value of giants Hasbro and Mattel, writes Financial Times, as reported by UNN.
Details
Pop Mart, founded in 2010 by Wang Ning from Henan province, is now valued at 40 billion dollars - twice as much as Hasbro and Mattel combined. In 2020, the brand entered the Hong Kong Stock Exchange, and Wang Ning himself, as the publication notes, "became one of China's richest people with a fortune of over 21 billion dollars." Only last year, Pop Mart's revenue from outside China amounted to 5.1 billion yuan (approximately 707 million dollars), or 39% of all profits.
"Blind Box" Magic
Pop Mart sells its toys in so-called "blind boxes," where the buyer does not know exactly which figure they will receive. This model encourages repeat purchases, creates collectible hype, and even causes addiction. Some dolls on the secondary market are sold for three times their original price. In China, this model attracted the attention of authorities: state media called for stronger regulation due to risks for minors. After this, the company's shares fell by 3.6%.
Pop Mart actively promotes exclusive series, including editions for individual cities. For example, Mega Space Molly can only be purchased in Shanghai. Limited edition figures create a stir: recently, a human version of Labubu was sold at an auction in Beijing for 1.2 million yuan (over 160 thousand dollars).
The Labubu phenomenon, according to Jason Yu of Kantar Worldpanel, has a deeper explanation.
Many young people in China are children who grew up without siblings. They often feel lonely
Labubu and similar toys satisfy the need for emotional connection and comfort.
Labubu sales last year grew more than eightfold, providing one-fifth of Pop Mart's total revenue. Other collections are also gaining momentum - the Crybaby line, for example, grew 16fold. However, experts warn that the company may lose momentum without new products.
If Pop Mart cannot constantly update its intellectual property, fans may lose interest
Recall
It was previously reported that shares of Pop Mart, the manufacturer of Labubu toys, fell by 8% after criticism from the Communist Party for "blind boxes," leading to a loss of $4 billion in market value. The company was accused of encouraging repeat purchases through a hidden content mechanism, especially for minors.