Small toys are big business in China.
In fact, they drove a Beijing-based company to a staggering $6.3 billion valuation, making its founder a billionaire three times over.
Popmart, founded in 2010 by Wang Ning, now 37, has sparked a mysterious toy boom in China. The company’s “blind box” hides the exact design of the figure until it is opened. A shopper chooses from a colorful box in which he is promised one of 12 different designs and asks for more designs depending on what’s inside.
In 2021, blind boxes overtook assembly toys to become China’s largest pop toy sector, according to Statista analysis. The popularity of blind boxes has prompted the Chinese government to regulate blind boxes, with retailers no longer allowed to sell blind boxes for more than 200 yuan ($31.46) each, or to sell them without parental consent. It is prohibited to sell blind boxes to children under the age of 1.
“A lot of kids love our products, but that’s not the majority of our customers,” said Larry Lu, PopMart’s head of North America. luck.
Instead, the company’s biggest fans in both China and the U.S. are “kids” between the ages of 20 and 35, adults whose spending habits are similar to those of children.
Pop Mart’s 2023 global revenue totaled $871 million, an increase of 36.5% year over year. Pop Mart operates more than 450 retail stores and more than 2,300 roboshops (vending machines) worldwide.
Now, Popmart is betting that its “designer toys” will be popular in the West. The brand operates his eight retail stores and 15 RoboShops across the U.S. Blind boxes typically retail for $14.99 a pop, but special 30-inch figures sell for up to $1,399.90 will be done.
Whether Pop Mart can replicate its success in Asia in the West remains a mystery until it’s unboxed. But if the growing popularity of Japanese blind box toys in the U.S., such as Sonny Angels, Calico Critters and Smith Kisses, is any indication, there’s plenty of room for growth.
pop art
Pop Mart started as a general store in Beijing in 2010 when founder and CEO Ning Wang was a university student. The store sold a variety of trinkets and toys, with the Japanese brand Sonny Angels being the most popular.
In Wang’s mind was Sonny Angel, a 3-inch-tall naked angel in a blind box. He came up with the idea of blind boxing his game, but it was with a “designer” spin. In 2015, Pop Mart crowdsourced ideas from customers, asking them what kind of characters they’d like to see on social media platform Weibo.
One comment read: “Molly, Molly, Molly.”
The brainchild of designer Kenny Wong, Molly is a girlish character with emerald eyes and a permanent pout. Mr. Wang flew to Hong Kong in 2016 to meet Mr. Wong and sign him as PopMart’s first artist. Through this agreement, Popmart acquired exclusive rights to Molly.
“We move designers and artists forward, not hide them behind characters,” Lu said.
Mr. Wong was also recommended as a shareholder of Popmart. In 2019, CEO Wang sold a 2% stake in the company to Mr Wong, which is now worth about $127 million. However, other PopMart artists typically receive compensation as a percentage of sales or a commission rate, Lu said.
After signing Wong, Popmart further strengthened its portfolio with up-and-coming artists and introduced new characters such as Dimo, a confused boy, Skull Panda, an edgy humanoid, and Duckoo, a costumed duck.
The company was listed on the Hong Kong Stock Exchange in 2020 and currently has a market capitalization of approximately $6.4 billion. forbes Mr. Wang’s net worth is estimated to be around $3 billion.
Pop Mart’s artistic attitude resonates with fans in Asia. The brand hosts meet-and-greet events for fans to get items autographed by artists, and Lu said fans “go crazy” for these events.
“Our loyal fans know Kenny as Molly’s designer,” Lu said. “Do you know who Mickey’s designer is?” [Mouse]? No one knows that. Who is the designer of Kung Fu Panda? No one knows that. ”
Provided by Popmart
Bubble pop?
Popmart derives most of its revenue from product sales, but it also licenses its original characters to other companies for use in products and advertising. For example, in a collaboration with Crocs, characters from Pop His Mart appeared as Jibbits, and in a collection with Uniqlo, Molly and others adorned the Japanese fashion brand’s graphic T-shirts.
These license agreements are two-way. Pop Mart has produced figures in collaboration with major entertainment brands such as DC Comics, SpongeBob SquarePants, Harry Potter, and The Big Bang. However, these licensed IP products accounted for only 16.5% of Pop Mart’s revenue in 2023, while original artist products accounted for 76.5%.
According to Lu, the repurchase rate for PopMart products in China is very high.
“When you stand in the store, you see that many customers pay, take the box out, check it out, and then come back to pick another item to purchase,” he says.
But while a social media post in which a fan shows off a room full of PopMart products is a testament to the brand’s power, it’s also a cause for concern.
“If the room is full of products, will they buy more?” said Lu. “I’m not sure.”
As such, Pop Mart is diversifying its revenue streams through gaming, animation, and theme park ventures. Popmart launched its official mobile game in May 2023 and opened Popland amusement park in Beijing in October.
pop psychology
PopMart fans are on the rise in the U.S. One of Popmart’s “kids” fans is Alyssa Tan, 23, a San Francisco-based content creator who specializes in unboxing videos. She (Tan) not only purchased it herself, but also received promotional gifts from Pop Her Mart.
“Life can be boring sometimes with a 9-to-5 daily routine,” Ms Tan said. “But every time I open it, I get a dopamine rush.” [a blind box.]”
Shortly after PopMart opened its first U.S. store in Santa Clara, Calif., Tan took an hour-long Uber ride from San Francisco to shop.
“Everyone and their mothers were there,” she said. “It was stuck.”
Mr. Tan, who owns about 30 PopMart items, said he can see the care taken in each figure’s design and its durable quality. She also turned her blind box unboxing into a social experience with her friends, sometimes buying and opening them together.
“I feel like the childishness inside me, which I can’t express right now, is coming out,” she said. “So I express that by unpacking these things.”
Economists have long theorized about the lipstick effect, the idea that during recessions, consumers spend more on small luxuries like lipstick. For Tan, the Pop Mart figures have a similar effect. It’s a little luxury during times of monotony and uncertainty.
“It’s a little treat,” she said. “It’s not too much, but it gives you the dopamine you need.”
