Author丨Yezi Produced by丨Retail Park

Henan's new richest man has changed hands.

On June 8, according to Forbes' real-time rich list, Pop Mart founder Wang Ning surpassed Qin Yinglin (the first pig raising stock) of "the first pig raising stock" Muyuan shares, with a net worth of US$20.3 billion, becoming the new "richest man in Henan".

Wang Ning, a post-80s entrepreneur, has successfully built a popular toy that is hard to come by for a child with his keen business insight and innovative spirit.

There was a long queue in front of offline stores, and the online live broadcast room was full of screens asking "when will the stock be replenished", and the consumer group also expanded from young girl Lisa to middle-aged man Beckham. In a shopping mall in London, England, there was even an incident where several tall and big scalpers fought for dolls...

"Ugly Baby" has been selling well around the world, once driving Pop Mart's stock price to rise by more than 160%. How many people beat their chests and stamped their feet and missed Pop Mart again? Its popularity is by no means accidental. What kind of business logic and market insights are hidden behind this?

01

Use IP to create emotional containers

After the popularity broke out, the entire public opinion had obvious polarization.

People who like it can't put it down and think it is both cute and unique; while others think it is just an ordinary toy for children, just like Bingdundun, just a gust of wind, and the heat will eventually pass.

Ultimately, this difference stems from the different psychological needs deep in different people.

In fact, many trendy products are far more than just toys, they are containers that carry consumers' emotions and memories.

Especially those IP images with strong emotional projection can easily arouse consumers' resonance and emotional recognition. So, how can we deeply establish this recognition?

Pop Mart gave his own answer: accurately target young consumer groups, especially Gen Z, and continuously create a new IP image that can provide emotional value and meet their personalized expression needs.

As an example, it grinned with a big mouth, revealing 9 jagged fangs, and had a smile on its face, like a little monster with an evil aura.

However, it is this unique design of "ugly and cute" that gives it a high degree of recognition and gives people a "cool" and "personality".

Let’s look at Pop Mart’s first phenomenal IP—MOLLY. In the early development and publicity process, MOLLY did not have a fixed personality or values.

Consumers can freely understand the image of MOLLY. Wang Ning once emphasized, "100 people may have 100 MOLLY in their hearts. It hollows out its own soul and you can put your soul in it."

At first, Pop Mart was worried that once a specific character design was set for MOLLY, it would make it boring.

Today, MOLLY's image has been given distinct personality traits such as independence and stubbornness, and has become a way for many consumers to express themselves and release their emotions.

By exploring cultural connotation and emotional depth, Pop Mart has created one hot item after another.

For example, this IP created by artist Xiong Miao is a model of artisticization. Since its first launch in 2020, more than ten generations of products with their own characteristics have been launched. Once the "Jungle Castle" series was launched, it broke Pop Mart's sales record.

The originally priceless artistic expression seems the most expensive as emotional needs. Wang Ning once emphasized that Pop Mart is essentially a "art company", but at the same time, it uses commercial means to promote it.

So, you will see that last year's revenue has increased from 39 million yuan in 2020 to 1.025 billion yuan, an increase of 25 times.

02

A red sea of ​​blind box business

Anyone who has opened a blind box knows how cool it is to participate in a small gambling.

In just a few minutes of unpacking the box, dopamine secretion soared to the extreme. When luck comes and you get the coveted style or rare version, that instant ecstasy experience is enough to be addicted.

It is this model that cleverly combines trendy toys with randomness and surprise that not only greatly increases the frequency of consumers' purchases, but also gives the product higher scarcity and collection value through the settings of limited and hidden models.

Pop Mart is working hard to transform from a blind box toy sales company to an IP company.

However, this model is not without hidden worries. Although Pop Mart continues to inject new creativity and vitality through close cooperation with outstanding artists around the world, the blind box business is highly dependent on the vitality and continuous innovation capabilities of IP.

If the popular new IP cannot be continuously launched or the popularity of existing IPs will be maintained, consumers' enthusiasm for purchasing will weaken and the company's performance will also face the risk of a decline.

For example, the revenue of the PUCKY IP launched in 2018 has declined from 2020 to 2022, and the revenue of the IP will no longer be disclosed in the 2023 financial report.

This is undoubtedly a warning, reminding Pop Mart that it must always be alert in IP operations. At the same time, the rapid development of the blind box market has also attracted the influx of many competitors, and the competition in the IP market is becoming increasingly fierce.

Founded in 2015, it emphasizes positioning as a "collected toy". It has used film and television IPs such as "The Wandering Earth 2" to create popular products such as "Bonny" deformation mecha toys.

Currently, it has 100 owned and authorized IPs and has submitted a prospectus to sprint for Hong Kong stocks.

The TOP TOY, which is also considered to be listed in Hong Kong, relies on Miniso's channel and supply chain advantages to build a product matrix covering multiple categories such as blind boxes, figures, building blocks, etc., while also actively incubating its own IP.

Relevant statistics show that there are more than 1,000 TOP TOY cooperation IPs and more than 10,000 SKUs.

There is also the building character toy company Bruco, known as the "Chinese version of Lego", which has also achieved a surge in revenue with the authorization of well-known IPs such as Ultraman and its own R&D capabilities.

03

How to lead trend culture?

In the past, many people thought Pop Mart's success was because its blind box form was particularly popular.

Now, it is not just relying on blind boxes, but also other types of products, such as plush toys, building blocks, etc., which are also bringing revenue to the company.

Compared with the blind box business model, Wang Ning has always believed that Pop Mart is an "IP incubation company".

Moreover, from an industry perspective, Pop Mart has successfully shaped many classic IPs in a non-mainstream and non-traditional way.

In the past, traditional IPs usually had a complete story or background setting, such as movies, animations, novels, etc., to attract fans through these stories, and then develop related peripheral products. For example, "Harry Potter" first contains novels and movies, and then there are various peripheral products.

To a large extent, consumers buy related peripheral products because they like the characters and plots in the story.

But Pop Mart is different. Like MOLLY, Pop Mart deliberately downplayed the specific story background when promoting it, but emphasized its communication attribute as a "cultural symbol".

It is this model in which everyone can freely give their emotions, which lowers the threshold for entry of IP and increases consumers' sense of identity and loyalty to IP.

At the financial report press conference, Wang Ning described Pop Mart's IP incubation form as an efficient platform like "Tik Tok".

"We will try to 'cut' resources, always pay attention to the popular elements in the market and the sales performance of products, and then decide whether to invest more resources in this IP."

Of course, Pop Mart's IP business ambitions are more than that.

In Wang Ning's plan, Pop Mart can have many super IPs like Disney and have the ability to continuously incubate IPs, providing the company with sustained and stable growth.

If you follow this step, then from trendy to animation, from games to paradise, the depth of the industrial line will become Pop Mart's only way.

At present, Pop Mart has established a comprehensive operation platform covering the entire industrial chain of trendy toy IP, including four major sections: IP incubation and operation, trendy toys and retail, theme parks and experience, and digital entertainment.

Not only that, Pop Mart has also established a stable production supply chain system through self-built and cooperation.

At the same time, the company actively expands online and offline sales channels, including opening brand stores, robot stores, e-commerce platforms, etc., which has improved the market coverage and sales scale of the products.

From this perspective, Pop Mart's future will not be a "blind box company" or "IP company" or a Disney company.

Just as Pop Mart's prospectus says, its vision is to become a world-leading "trendy cultural entertainment company".