Core Insights - The phenomenon of Labubu, a unique IP, has sparked significant interest in the cultural and creative industry, highlighting the potential for local IP development in Shenzhen [1][3] - The discussion around Labubu's success reveals critical insights into consumer behavior, particularly among the younger demographic, and the importance of emotional value in driving sales [3][8] Consumer Engagement and Market Dynamics - Labubu's search popularity on Douyin increased by 97 times in two months, with 89% of its audience aged 18 to 40, predominantly female [3] - The success factors for Labubu include targeting Gen Z's emotional consumption needs, strong social attributes, effective use of new media for marketing, and the collectible value of blind box models [3][4] - The blind box model has created a speculative investment aspect, with hidden variants commanding premiums of up to ten times their original price [3] Industry Challenges and Opportunities - The development of successful IPs like Labubu requires long-term investment and consistent exposure, often taking a decade or more [10][11] - The rapid imitation of successful products poses a significant risk to original creators, highlighting the need for stronger IP protection [10][11] - Shenzhen's cultural industry is characterized by strong manufacturing capabilities but lacks in brand development and high-value segments of the value chain [11] Future Directions and Strategic Recommendations - There is a consensus on the need for a more integrated approach to IP development, combining design, marketing, and consumer psychology [12][14] - The government is encouraged to support local IPs through policy frameworks, marketing initiatives, and regulatory oversight to foster a sustainable creative ecosystem [14][15] - The cultural industry must address the emotional needs of consumers, providing deeper engagement and connection through its offerings [15]

Core Viewpoint - The article discusses the recent surge in popularity of the Labubu toy, highlighting its rental market on platforms like Xianyu and the broader implications for the collectible toy industry, particularly for Pop Mart. Group 1: Labubu's Popularity and Market Trends - Labubu-related product searches on Xianyu increased tenfold from May to June, with rental transaction volumes doubling in the same period [2] - The rental prices for Labubu figures range from 30 yuan for "Labubu time to chill" to 50-80 yuan for ZIMOMO figures, indicating a growing market for rental services [1] - The popularity of Labubu has also spurred related services such as custom clothing and repairs, showcasing a trend towards a more extensive ecosystem around the IP [2] Group 2: Pop Mart's Business Dynamics - Pop Mart's founder, Wang Ning, has become the richest person in Henan with a net worth of $20.3 billion, reflecting the company's significant growth from a small shop to a market capitalization exceeding 300 billion HKD [4] - The collectible toy market, particularly for Labubu, has seen extreme price fluctuations, with some items being resold at prices up to 46 times their original value, indicating a volatile market [4] - There is uncertainty regarding the longevity of Labubu's popularity, as the collectible toy industry often experiences trends that can be unpredictable and fleeting [5][6] Group 3: Industry Challenges and Future Outlook - The collectible toy market faces challenges as the lifespan of popular IPs can be limited, leading to concerns about the sustainability of Pop Mart's business model [6] - Investors express skepticism about the long-term viability of Pop Mart's reliance on IPs, questioning what will happen if consumer interest wanes [7] - The blind box model, while initially seen as a key driver of sales, is now viewed as secondary to the appeal of the IPs themselves, raising questions about future competitiveness [7]

Core Viewpoint - The article highlights the global success of Pop Mart, a Chinese toy company, which has created a phenomenon in the collectible toy market, comparable to Disney, through its innovative blind box and plush toy offerings. This success has led to a surge in the number of related businesses in the industry, indicating a growing trend in the collectible toy market [1][2]. Group 1: Market Performance - Pop Mart's stock price has surged by 900% over the past year, with a market capitalization exceeding HKD 314.2 billion, making it a standout performer in the current consumer market [2]. - The collectible toy market in China has seen a significant increase in registered companies, with 26,800 existing as of May, and a 48.2% year-on-year growth in new registrations in the first four months of the year [1]. Group 2: Business Strategy and Growth - The company has successfully tapped into emotional value, creating characters like Labubu that resonate with consumers, leading to substantial sales growth. For instance, the average single-store revenue is projected to grow by 30% in 2024 [6]. - Pop Mart's international expansion strategy has been effective, with significant sales in Southeast Asia, particularly after collaborations with local artists and influencers [6][5]. Group 3: Challenges and Concerns - Despite its success, the company faces challenges such as market saturation, counterfeit products, and a decline in consumer trust due to the speculative nature of blind box purchases [8][10]. - The company has experienced a drop in member repurchase rates from 58% in 2019 to 49.4% in 2022, indicating potential issues with customer retention and satisfaction [10]. - The reliance on a few successful IPs raises concerns about sustainability, as the lifecycle of popular products may be shortening, and the company lacks a cohesive narrative to support its brand [10][11].

Core Viewpoint - The article discusses the competitive landscape of the IP toy industry in China, focusing on the company Lezi Tiancheng (乐自天成) and its potential IPO amidst a rapidly growing market dominated by Bubble Mart and Blok. The company faces challenges in achieving profitability and creating blockbuster original IPs, which are crucial for its growth and market positioning [1][3][5]. Group 1: Company Overview - Lezi Tiancheng is the third-largest IP toy company in China, with a market share of 1.2%, trailing behind Bubble Mart and Blok, which hold 11.5% and 5.7% market shares respectively [3]. - The company was founded in 2015 and has since developed a significant portfolio of IPs, including both licensed and original creations, with 35 original IPs by the end of 2024 [2][3]. Group 2: Financial Performance - Lezi Tiancheng's revenue from 2022 to 2024 shows a gradual increase, with figures of 4.63 billion, 4.82 billion, and 6.30 billion yuan respectively, but it has not yet achieved profitability, with net losses expanding from 1.7 million to 122 million yuan over the same period [3][5]. - The company relies heavily on licensed IPs for revenue, with licensed IP revenue increasing from 2.33 billion yuan in 2022 to 4.06 billion yuan in 2024, while revenue from original IPs has stagnated [5]. Group 3: Market Strategy and Growth Potential - Lezi Tiancheng has seen significant growth in its overseas market, with revenue increasing from 35.4 million yuan in 2022 to 147 million yuan in 2024, representing a compound annual growth rate of over 100% [6]. - The company plans to allocate 25% of its IPO proceeds to expand its direct sales channels overseas, targeting markets in Southeast Asia, Hong Kong, Taiwan, Japan, and the United States [6][7]. - The management believes in its ability to compete in the global market, citing a threefold increase in GMV in Japan and a fourfold increase in Thailand in 2024 [7].