Consumers purchasing blind-boxed items at Bubble Mart’s global flagship store in Shanghai. Image Source Visual China
Written by Hu Shixin Wu Zha Edited by Wen Shijun From Prism Tencent Xiaoman Studio
Written by Hu Shixin Wu Zao Edited by Wen Shijun
Published by Prism Tencent Xiaoman Studio
Over the past six months, Yu Xuan, a pseudonym, has noticed that the number of Bubble Mart POP MAR T stores and robot stores has increased, both in shopping malls and subway stations.
Unlike other trendy games, Bubble Mart mainly sells them in blind boxes, which makes consumers full of unknowns and expectations when they buy them. Walking into a Bubble Mart store, Yu Xuan was somewhat overwhelmed by the many IP zones. First, he found the IP zone he wanted to draw from and picked up a random box from the row of blind boxes.
However, this is only the first step. Those who have experience in drawing boxes will often play with the box in their hands for a while. First, they shake it, then they shake it again, and listen to the subtle sound of the plastic packaging inside the box. Yuxuan does the same, trying to determine whether the box contains his favorite IP style or a hidden model based on the sound. If it doesn’t sound right, he’ll shake another one until he picks the most likely one.
In order to increase the probability of drawing the center of the instrument style or hidden models, to avoid drawing duplicate dolls, Yu Xuan will sometimes end the box, directly buy a complete set of Bubble Mart products, the price of the most expensive to thousands of dollars, the cheaper ones are also a few hundred dollars.
Young people’s love for Bubble Mart is amazing. Some people spend as much as nearly 15 million a year, some people rely on selling tide toys daily income of 20,000 yuan. But the big boss behind the bubble Mart, the young people have made the company earn a lot of money.
In 2023, the company’s revenue broke the 6 billion mark, reaching 6.3 billion yuan, an increase of 36.5 percent year-on-year, and the net profit was as high as 1 billion yuan, 11 times more than five years ago. 2024, Bubble Mart’s development momentum is more and more rapid, only the first half of the year, the net profit will reach 1 billion. Chairman and CEO Wang Ning even said that he was confident that the revenue in that year exceeded 10 billion yuan.
As of the close of business on January 13, the total market value of Bubble Mart reached 113.3 billion Hong Kong dollars, the company let many investors shouted that they could not understand, 2020 Hong Kong stock market value exceeded 100 billion, in 2022 plummeted to 13 billion Hong Kong dollars.
Now, the bubble Mart market value back to 100 billion, just like the staging of a Xi Fei returned to the Palace of the plot.
The value of a labubu is equal to more than 20 grams of gold.
Li Hui pseudonym is a 211 university in Beijing, a doctoral student, this year is the fourth year of reading the blog, but also his pit in the bubble Mart the fourth year.
When he first came into contact with Bubble Mart, Li Hui was attracted by LABUBU, the top streaming star that is now very popular in Thailand. The first Bubble Mart I bought was LABUBU, and I spent eight or nine hundred dollars on the hidden model. Today, Li Hui has spent well over 100,000 yuan on the trendy game.
On the collection shelf in Li Hui’s room, there are all kinds of Bubble Marts, big and small. When he goes out for shopping or traveling, he takes a few Labubu with him and sometimes takes pictures of them, as if he is raising his own children. Like most young people, Li Hui believes that Bubble Marts provide emotional value.
In April last year, Labubu burst into the limelight and became one of Thailand’s top celebrities.
At that time, Lisa, a member of the Korean girl group BLACKPINK, posted a picture of herself with a blind box of LABUBU macarons on Instagram for three consecutive days. It is important to know that Lisa has more than 100 million followers on Instagram, which is 30 million more than the total population of Thailand.
This seemingly inadvertent action triggered a shock in the hip toy circle, and the price of the LABUBU macaron blind box, which was originally priced at about 1,000 RMB, then rose to more than 1,500 RMB.
Since the LABUBU fire, Li Hui gradually found that he can no longer buy his favorite LABUBU at the original price, he complained Premium is too high, a LABUBU Dawa original price of only six hundred or so, before the fire, some spend three or four hundred can buy, now a six or seven thousand.
A 2024 early official price of 599 yuan LABUBU co-branded models, now in the second-hand platform price tag up to more than 10,000 yuan, in accordance with China’s gold base price to calculate, is equivalent to more than 20 grams of gold.
Li Hui did not expect, less than a year, LABUBU premium more than 20 times, soaring speed is comparable to a roller coaster. Sometimes, Bubble Mart will be limited to regional release. A LABUBU Mario released in Thailand, I spent more than ten thousand to buy.
Some of the original favorite styles have become unattainable due to speculation in the second-hand market, and these moments of constant price increases to get rare models make Li Hui feel helpless. He began to realize that the bubble mart market is no longer so pure, more scalpers and speculators pouring into the circle, making the originally simple collection complicated.
For the second-hand market situation, Wang Ning has confessed that he does not care, all commodities, as long as there is a secondary market, it means that the commodity itself belongs to a charismatic category, not all commodities can be resold to the secondary market.
In the opinion of industry analyst Zhang Shule, behind the high premium of Bubble Mart in the secondary market, there are factors such as product scarcity and collection value, as well as a certain amount of speculation. Some consumers regard it as an investment product, hoping to profit from the difference between the price of buying and selling, which to a certain extent promotes the development of the secondary market, but also brings market bubbles and risks.
Moutai for young people
A lesser noticed thing, Bubble Mart is one of the biggest gainers in Hong Kong stocks in 2024, with its yearly rise as high as 342 72 .
In the first half of 2024, Bubble Mart’s revenue reached 4.56 billion yuan, up 62 Adjusted net profit of 1.02 billion yuan, up 90 1 .
The tide play market, at this time, is in an overall weak situation. According to the statistics of Wenchuang Chao, in the first half of 2024, Jiu Mu miscellaneous goods society TOP TOY and other 25 companies in the toy business, Bubble Mart is one of the few to realize double growth in revenue Profit one of the few, and undoubtedly one of the largest share.
If you look at a longer time line, 2020 to 2023, Bubble Mart revenue were 2.513 billion, 449.1 billion, 461.7 billion, 630.1 billion Gross profit margins for the same period also remained at a high level, respectively, 63, 42, 61, 43, 57, 49, 61, 32. This kind of gross profit makes many netizens jokingly call it the young man’s Maotai.
In recent years, Bubble Mart has taken IP incubation and operation as its core strategy.
If divided by IPs, Bubble Mart’s own products are mainly divided into artist IPs and licensed IPs. among them, artist IPs, which include own IPs and exclusive IPs, will generate revenues of 4.8 22 billion yuan in 2023, a year-on-year increase of 32 5 , accounting for 90 8 of the total revenue.
Kobayashi, a former designer at Bubble Mart, said that in addition to providing emotional value, there are many consumers who pay for beautiful design. As a result, the company demands more from its designers than other hip toy companies.
In 2023, Bubble Mart will have more than ten artist IPs with sales of more than 100 million dollars. Among them, the performance of classic IP is still strong, SKULLPANDA MOLLY and DIMOO accounted for a total of 48 3 of the total revenue, nearly 50%, respectively, to realize revenues of 1,025 million yuan 1,020 million yuan 738 million yuan.
Further estimation, the total annual revenue of these ten IPs can exceed the total annual revenue of other head trendy game brand companies such as Nine Wood Miscellaneous Club TOPTOY.
And in the first half of 2024, Bubble Mart’s IPs that exceeded $100 million in half a year rose to seven from five in 2023, namely MOLLY THE MONSTERS SKULLPANDA DIMOO CRYBABY Hirono Ono Zsiga.
Back in 2017, Bubble Mart’s IP structure was still a dominant one . Its main IP MOLLY used to account for nearly 90 of the company’s total revenue . Today, MOLLY’s revenue share is only 17 2 .
The essence of the fashion game is a business that relies on the emotion and companionship of the IP. Xuan Yilang, design director of Bubble Mart and creator of the Ono IP, once mentioned in an interview that the attributes of trendy toys are more than just toys, and that behind them is the designer’s emotional delivery.
Rao Gang, an adjunct professor at the Shanghai Advanced Institute of Finance at Shanghai Jiao Tong University, also believes that nowadays, consumers are more inclined to choose some lightweight products that can satisfy their personalization and emotional value to treat themselves, and trendy toys are exactly in line with this demand.
In addition, the vast sinking market has also become the starting point for Bubble Mart. Li Hui recalled that when he first entered the market, there were not too many Bubble Mart stores, which could be found in big cities but not in small ones, and he had to buy online. Nowadays, Bubble Mart can be found in shopping malls in many third- and fourth-tier cities.
Jiao Jiao pseudonym Living in a fourth-tier city, 2 years ago, the local opened the first Bubble Mart stores, as a front-line store staff, she said bluntly, the young people here in fact relatively few, but the store business is not bad, business is good when the turnover can reach 40,000 yuan a day.
In 2023, Bubble Mart closed three offline stores in first-tier cities, but opened 27 new stores and 52 robot stores in second-tier cities and below.
Revenue from second-tier and below cities became the mainstay, with its total revenue from offline channels amounting to 1,002 million yuan, up 48 4 , with the fastest revenue growth rate in the region.
The online live streaming platform was also an important support for Bubble Mart’s performance.2023, when the revenue of the two major online channels, the online box drawer Tmall flagship store, declined by 23 6 and 30 4 respectively, the revenue of the Shake Shack platform soared by 431 2 year-on-year to 280 million yuan, and the share of the online channel also rose from 2 9 to 16 6 .
Co-branded products had been officially named and criticized
At the end of 2020, Bubble Mart had a high moment when they successfully landed on the Hong Kong Stock Exchange, opening up over 100 on the first day .
However, the company went through a tough time after that, and the share price fluctuated. 2022, Bubble Mart’s revenue growth was less than 3, and its net profit fell by 40%, resulting in a continuous decline in the share price. in october 2022, the share price fell from a peak of HK$106,24 to HK$9,9, with a total market capitalization of only HK$13.2 billion left.
The sound that Bubble Mart’s bubble would be burst also began to clamor.
In addition, some of Bubble Mart’s activities were also criticized.2022 In January, KFC and Bubble Mart co-branded the DIMOO co-branded blind box set meal . The package caused a frenzy among consumers when it was launched. It combines KFC’s sundaes, fries, coke and other food elements with DIMOO’s character, with 6 regular models and 1 hidden model.
The set usually consists of a family bucket and a blind box and is priced at $99. Consumers who want to collect the entire set will also have to spend $700 without drawing a duplicate model.
However, the hidden blind box is very rare, the probability of winning the lottery is only 1 72. Some consumers in order to have a complete set of dolls, not hesitate to spend tens of thousands of dollars, a one-time purchase of more than 100 packages, and there are also people looking for a special buy on behalf of the food, which has been criticized by many netizens for causing a lot of food waste.
Subsequently, the China Consumers’ Association released an article with a blind box induced excessive consumption of food, when boycotted , pointing directly to this joint marketing.
On 315 of the same year, CCTV exposed the problem of high quality and poor price of the blind box, pointing out that the cost of the 800 RMB blind box was only 30 RMB, and that some consumers had spent more than 10,000 RMB for the hidden blind box. For a while, Bubble Mart was pushed into the limelight.
In Zhang Shule’s opinion, Bubble Mart initially gained popularity rapidly by virtue of the unique sales format of the blind box, completing the primitive accumulation. But the blind box itself does not have the ability to support the development of the company for a long time, with the development of the market and the intensification of competition, the company needs to transform. After going public, Bubble Mart began to emphasize that it is a trendy company, and is committed to the creation and operation of IP, in order to enhance the brand’s sustainable development ability.
The number of consumers who entered Bubble Mart continued to increase, but at the same time, some young people’s enthusiasm for Bubble Mart began to wane. Searching for the term Bubble Mate retreat on the Xiaohongshu platform brings up more than 50,000 related notes, and a large number of posts containing Bubble Mate retreat labels can be found on second-hand trading platforms such as Idle Fish.
In addition, there are also a lot of consumers launched a complaint against Bubble Mart. As of January 9, there were more than 15,000 complaints related to Bubble Mate on the Black Cat Complaint Platform, with 219 new complaints in the last 30 days. Consumers are dissatisfied with Bubble Mart’s quality, quality control, after-sales service, box-ticking mechanism and other aspects.
Overseas to create another Bubble Mart
It is worth noting that overseas is becoming a new growth point for Bubble Mart. According to its Q3 2024 financial report, its revenue from Hong Kong, Macau, Taiwan and overseas business realized a surge of 440,445.
On July 1 last year, at Suvarnabhumi Airport in Bangkok, a LABUBU doll in traditional Thai dress interacted with more than 100 Thai fans holding up support banners, in a scene comparable to the scene of a top-stream celebrity’s pick-up. On that day, Thai officials held a grand welcome ceremony for LABUBU, in which the Minister of Tourism and Sports and several senior officials attended in person at the airport and awarded LABUBU the title of Magical Thailand Experience Officer.
Bubble Mart also opened the world’s first LABUBU-themed store at MEGA BANGNA, Southeast Asia’s largest shopping center in northeast Bangkok. On the opening day, the store’s turnover exceeded RMB 10 million, setting a record for Bubble Mart’s overseas stores.
Bubble Mart first began to venture into the overseas market in 2018. At that time, Wang Ning approached Wen Deyi, president of Bubble Mart’s international business, and invited him to explore the overseas market.
The first overseas stop was chosen in Wen Deyi’s hometown of Seoul, South Korea. Originally, Bubble Mart was mainly engaged in the To B overseas supply business, and since the establishment of the joint venture in South Korea in 2019, it has accelerated the layout of To C and shifted to the direct customer model.
Wen Deyi has also previously said that in markets with high growth potential, such as North America and Southeast Asia, the company will also increase its investment to achieve wider market coverage and brand influence enhancement, and it is clear that this strategy has received good results.
For example, Oxford Street in London, UK, is one of the world’s largest shopping districts, and Bubble Mart has opened stores in the heart of Oxford Street. In San Francisco, Milan, Amsterdam and other international metropolises, Bubble Mart has also placed its stores in the busiest neighborhoods. Last year, Bubble Mart opened a store in the Louvre for the opening of the Olympic Games in Paris.
As of the end of October 2024, Bubble Mart will have 106 stores overseas. And at the end of 2021, Bubble Mart will have only seven stores and nine robot stores overseas.
The year 2022 can be considered a turning point for Bubble Mart’s overseas business. That year, Bubble Mart opened 21 new stores overseas, and store revenue grew 41 2 times year-on-year to $136 million. With 40 new robotics stores, revenue grew 665 0 . online channels such as Shopify and Amazon, revenue grew from $41.16 2 million to $90.22 4 million.
During the year, Bubble Mart’s revenue in the mainland China market was 4.163 billion yuan, down 3 33 percentage points from a year earlier.
Wang Ning has repeatedly said in public that overseas business has been Bubble Mart’s core business in recent years, and can be seen attending the opening day of many overseas stores. It is expected that in 2024, the revenue from overseas business will exceed the company’s total revenue in 2019, which is equivalent to creating another Bubble Mart overseas.
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