Core Viewpoint - The article discusses the phenomenon of Labubu, a fictional character blind box created by Pop Mart and artist Long Jia Sheng, highlighting its massive popularity and the resulting market dynamics, including the emergence of counterfeit products and the impact on the toy industry [3][4][5]. Group 1: Labubu's Popularity and Market Impact - Labubu has gained significant traction, being recognized as a "magical Thailand experience officer" and causing chaos in the UK market due to high demand [5]. - The third generation of Labubu faced a global shortage, leading to a surge in demand for "domestic versions" of Labubu, which are cheaper and more readily available [6][10]. - Merchants have reported that any product associated with Labubu sells well, indicating the character's strong market influence [7]. Group 2: Merchants' Strategies and Consumer Behavior - Merchants are capitalizing on the Labubu craze by producing and selling "domestic versions" at a fraction of the cost of the original, with prices reaching up to $20 for overseas sales [9][17]. - The popularity of Labubu has led to a rise in "改娃" (doll modification) culture, where consumers customize their dolls, further driving demand for related products [22][25]. - The article notes that selling Labubu-related accessories is more profitable than selling the original blind boxes due to lower costs and quicker turnover [26]. Group 3: Challenges Facing Pop Mart - Pop Mart faces challenges in maintaining the value of the Labubu IP, as the character's high production costs and limited availability create a dilemma between maintaining exclusivity and meeting consumer demand [29][30]. - The company is attempting to manage market prices through scarcity tactics, which may lead to long-term risks if consumers become disillusioned with the inability to purchase desired products [31][32]. - The rise of counterfeit products poses a significant threat to the brand, complicating enforcement and protection of the Labubu IP [33][35]. Group 4: Future Outlook - Pop Mart is focusing on continuous product innovation and marketing efforts to sustain the Labubu brand's relevance in the market [36][37]. - The company has released 110 new blind box products in 2023, indicating a strategy to keep the product line fresh and engaging for consumers [37].