Core Insights - The article discusses the explosive growth of the plush toy segment within the trendy toy industry, particularly driven by the popularity of the Labubu IP from Pop Mart, which has significantly influenced market dynamics and competition [4][9][22]. Industry Overview - The trendy toy industry in China is actively expanding into plush toys, aiming to capitalize on the market popularity ignited by Labubu [3][22]. - Labubu has become a global sensation, with long queues at Pop Mart stores and significant auction prices, such as an initial Labubu selling for 1.08 million yuan [4][6]. - Pop Mart's stock price surged from around 80 HKD to a peak of 283.4 HKD in six months, with a market capitalization exceeding 360 billion HKD [4][9]. Market Dynamics - The sales of Labubu's IP, The Monsters, are projected to exceed 3 billion yuan in 2024, marking a staggering year-on-year increase of 726.6% [9]. - Morgan Stanley forecasts a 152% increase in Pop Mart's overseas sales by 2025, with a compound annual growth rate of 42% from 2025 to 2027 [9][20]. - The plush toy market is experiencing a surge in interest, with many companies quickly launching similar products to capture market share [22][27]. Competitive Landscape - Companies like 52TOYS and Heyone are also entering the plush toy market, indicating a trend where multiple players are vying for a share of the lucrative segment [22][27]. - The article highlights the challenges faced by smaller companies in securing quality IP resources, as established players like Pop Mart have a competitive edge in signing artists and managing IP [25][26]. Consumer Behavior - Consumers are increasingly drawn to the Labubu brand, leading to a phenomenon where similar products are being rapidly produced and sold, even without prior market recognition [22][24]. - The article notes that the lifecycle of trendy IPs is typically short, with many companies needing to continuously innovate and introduce new IPs to maintain sales momentum [19][21]. Future Outlook - The market for plush toys is expected to become more competitive as more companies enter the space, driven by the success of Labubu and similar products [27]. - Companies must invest in marketing and operational strategies to effectively manage and grow their IPs, as the current market environment favors those with robust support systems [24][27].

Core Viewpoint - The toy brand 52Toys, operated by Lezi Tiancheng, has filed for an IPO in Hong Kong, aiming to become the third trendy toy company listed on the Hong Kong Stock Exchange. However, it faces significant challenges compared to its competitor, Pop Mart, in terms of revenue, profitability, and store count [4][10][27]. Group 1: Company Overview - Lezi Tiancheng is recognized as the third-largest IP toy company in China, often compared to Pop Mart, but it lags behind in revenue, profitability, and store presence [4][7]. - As of 2024, Lezi Tiancheng operates only 5 stores, a significant reduction from 19 stores in 2022, while Pop Mart has over 400 stores [7][10]. Group 2: Financial Performance - From 2022 to 2024, Lezi Tiancheng's revenue increased from 463 million to 630 million, but its losses also grew from 1.74 million to 12.2 million [10][11]. - In contrast, Pop Mart's revenue surged from 4.617 billion to 13.038 billion during the same period, with net profits increasing from 476 million to 3.125 billion, marking a 6.5-fold increase [10][11]. Group 3: Sales Channels and Revenue Sources - Lezi Tiancheng relies heavily on distributors, which contributed over 60% of its revenue from 2022 to 2024 [11][12]. - The company has 336 domestic and 90 overseas distributors, but its products have limited visibility in retail stores compared to competitors [12][13]. Group 4: IP Strategy - Lezi Tiancheng's growth is centered around its proprietary and licensed IPs, with over 100 IPs as of 2024, including 35 proprietary and 80 licensed [17][18]. - The revenue contribution from licensed IPs has increased from 50.2% in 2022 to 64.5% in 2024, with the character Crayon Shin-chan alone accounting for over 60% of total revenue [17][18]. Group 5: Competitive Landscape - The domestic trendy toy market is highly competitive, with multiple brands vying for consumer attention, making it challenging for Lezi Tiancheng to stand out [16][27]. - The company faces risks related to the expiration of licensing agreements for key IPs, which could significantly impact its revenue if not renewed [18][24].

Core Viewpoint - The article discusses the recent popularity of Labubu, a collectible toy from Pop Mart, and the potential challenges and opportunities for the company and the industry as a whole, including competition, market dynamics, and shareholder actions [4][5][6]. Group 1: Labubu's Popularity and Market Dynamics - Labubu has gained significant attention, with record auction prices, such as a mint green Labubu selling for 1.08 million yuan and a limited brown version for 820,000 yuan [6]. - The demand for Labubu has led to long queues and even conflicts among buyers, with reports of scalpers reselling items at exorbitant prices, such as a 599 yuan item being sold for 31,999 yuan, a more than 52-fold increase [7]. - The popularity of Labubu has also sparked interest in the collectible toy market, with a surge in transactions during the "618" shopping festival, where multiple merchants reported transaction totals exceeding 100 million yuan [10]. Group 2: Challenges and Risks - Despite the excitement, the rise of counterfeit products poses a significant threat to Labubu's brand integrity, with thousands of fake items being seized by customs [7]. - Analysts suggest that the current wave of interest may not be sustainable, as many new buyers may not continue purchasing once the initial excitement fades [11]. - The article highlights that while Labubu has successfully created a high-end brand image, the market may revert to a more rational state, indicating that the collectible toy market is not a mass-market demand [11]. Group 3: Shareholder Actions and Market Sentiment - Recent shareholder actions indicate a lack of confidence in the sustainability of Labubu's success, with significant share reductions by major stakeholders, including a sale of 21.7 million shares worth approximately 1.562 billion HKD [15][16]. - The stock price of Pop Mart has faced pressure following these sell-offs, with a reported decline of 6.77% during a specific period [17]. - Despite these concerns, Citigroup has maintained a buy rating on Pop Mart, raising the target price from 162 HKD to 308 HKD, citing the company's strong IP portfolio and potential for long-term growth [17].

Core Viewpoint - LABUBU, a toy character created by Hong Kong artist Long Jiasheng, has gained immense popularity, leading to a buying frenzy and significant price premiums in the market [1][4]. Group 1: Market Demand and Consumer Behavior - LABUBU has become a top-selling IP for Pop Mart, with a new store in Hangzhou selling out within two hours due to high demand [1][2]. - Consumers are experiencing difficulties purchasing LABUBU due to the presence of scalpers who buy entire boxes of products, leaving regular customers unable to buy [2]. - The limited edition VAS collaboration version of LABUBU is being resold for as high as 15,200 yuan, reflecting a significant markup [4]. Group 2: Sales and Distribution - Pop Mart has opened over 500 stores globally and reached over 90 countries through various e-commerce platforms by the end of 2024 [17]. - The company has temporarily halted the offline sales of LABUBU plush toys in South Korea due to safety concerns arising from overcrowding at stores [13]. Group 3: Brand and Cultural Impact - LABUBU's design and quality have contributed to its popularity, with the character's unique features making it memorable and appealing to consumers [17]. - The rise of LABUBU reflects a broader trend where collectible toys serve as a form of emotional expression and social currency among consumers [17]. - The brand has engaged in cultural collaborations, such as limited editions that resonate with local cultures in different countries, enhancing its global appeal [18].

Core Insights - The popularity of the Labubu toy has surged on social media, transforming from a niche product to a mainstream cultural icon, driven by its artistic roots and collaboration with Pop Mart [1][2] - Labubu's appeal lies in its combination of artistic, collectible, and commercial value, with limited editions and unique versions enhancing its desirability among consumers [1][2] - The rise of Labubu reflects a broader trend where collectible toys serve as a form of emotional expression and social currency in modern society [1] Industry Development - The quality of collectible toys is foundational, supported by a robust manufacturing industry in China, which has evolved from simple production to cultural innovation [2] - Labubu's success is attributed to effective long-term IP management, creating immersive consumer experiences through various channels, including online and offline interactions [2] - The international expansion of Labubu includes cultural adaptations and collaborations with well-known brands, enhancing its global appeal and market reach [2] Strategic Recommendations - Companies in the collectible toy industry should focus on building their own IP reserves and promoting value transformation to sustain growth [3] - The industry must leverage market insights and diverse operational strategies to cultivate self-owned IP that resonates with consumers [3] - Continuous exploration of both domestic and international markets is essential for the development of the collectible toy sector [3]

Core Viewpoint - The article discusses the transformation of Pop Mart from a blind box retailer to a potential luxury brand, highlighting the success of its IP LABUBU and the strategies employed to create desire and exclusivity in the market [5][41][61]. Group 1: Company Overview - Pop Mart's LABUBU contributed 3.04 billion yuan in revenue, marking a year-on-year growth of over 700% [5]. - The stock price of Pop Mart has increased approximately ninefold since early 2024, and nearly twentyfold since the lowest point in October 2022 [6]. Group 2: Product and Market Strategy - Pop Mart has redefined its business model, moving from a blind box retailer to a comprehensive IP operator, building a full industry chain covering design, production, channels, and community [17]. - The company has established a flexible supply chain model, reducing inventory turnover days from 159 to 100 days through data-driven sales predictions [13]. Group 3: Marketing and Brand Positioning - Pop Mart's marketing strategy includes a membership system and social media engagement, resulting in a 50% online repurchase rate [16]. - The collaboration with international designers and participation in fashion events, such as Milan Fashion Week, has significantly boosted LABUBU's visibility and desirability [39][41]. Group 4: Comparison with Luxury Brands - The article draws parallels between Pop Mart's strategies and those of luxury brands, emphasizing the importance of creating desire and exclusivity [60][63]. - Pop Mart's potential to become a luxury brand is supported by its ability to generate scarcity and community engagement, similar to established luxury brands [64][65].