Summary of the Conference Call on Pop Mart Industry Overview - The emotional consumption market is expected to exceed 2 trillion by 2025, driven primarily by Generation Z, who prioritize personalization and instant gratification through blind boxes and trendy toys, indicating a broad development prospect for the market [2][5][11]. Core Insights and Arguments - Pop Mart has successfully transformed niche products into mainstream offerings through innovative business models, including industrialized production of artist toys, channel promotion, and shifting the target demographic from males to females, enhancing user experience through meticulous detail management [2][6]. - The company ensures the sustainability of its IP by continuously launching new products, expanding into overseas markets, and operating IP in a group format, which includes updates to film content and theme park figures [2][7]. - Pop Mart is adept at commercializing world-class IP, accelerating the success of new products, such as the upcoming new figures by the end of 2024, demonstrating its capability to cultivate an IP matrix effectively [2][8]. - Future highlights for Pop Mart include new product launches, overseas market expansion, updates to film content, and the creation of a comprehensive ecosystem that extends from trendy toys to games and films, enhancing brand loyalty [2][9]. Key Differences in Consumer Behavior - The rise of self-indulgent consumption and emotional value enterprises is a significant trend from 2024 to 2025, primarily due to Generation Z becoming the main consumer group. This demographic focuses more on emotional satisfaction rather than just practical functionality, with over two-thirds of their total spending aimed at fulfilling emotional needs [3][5]. - Traditional companies rely on advertising, while emerging companies like Pop Mart utilize interpersonal communication and dynamic online-offline collaborations for promotion, highlighting a significant difference in competitive strategies and marketing approaches [4]. Market Dynamics - The emotional consumption market is thriving, with Generation Z leading the charge. This demographic not only seeks personalized experiences but also influences surrounding groups, indicating a broad consumer base and promising future growth [5][11]. - The global strategy of Pop Mart has shown strong performance, with overseas store profits surpassing domestic ones, prompting the company to accelerate its global expansion [10]. Investment Opportunities - The National Securities Hong Kong Stock Connect Consumption Index includes high-quality new consumption companies like Pop Mart, which are experiencing rapid fundamental growth and are undervalued compared to historical averages. This presents a favorable investment opportunity, especially with potential liquidity benefits from anticipated interest rate cuts by the Federal Reserve [3][14]. Additional Insights - Emotional consumption encompasses various sectors beyond trendy toys, including stress relief, cultural and tourism experiences, and the pet economy, which are expected to grow rapidly due to changing consumer demographics and preferences [11][12].