In recent months, a quirky and "ugly-cute" collectible toy character named Labubu has taken global social media by storm. Long queues have formed outside Pop Mart stores in cities like Tokyo, New York, and London, with sales even temporarily suspended in South Korea due to overcrowding. Limited-edition Labubu figures have fetched over a million RMB at auctions, and numerous celebrities have voluntarily promoted it on social media. Behind this frenzy is Pop Mart $POP MART(09992)$ , a Chinese toy company that has transformed from a niche player into a global pop culture phenomenon.
Labubu series
At the same time, Pop Mart’s stock—listed in Hong Kong—has become one of the most watched in the capital markets. Its share price has tripled this year, rising from around HK$90 to over HK$270, giving it a market cap of HK$360 billion (~US$46 billion)—surpassing global toy giants Hasbro $Hasbro(HAS)$ and Mattel $Mattel(MAT)$ . Founder and CEO Wang Ning has been propelled to the top of the wealth rankings in China’s Henan Province. The company has even been dubbed “Plastic Moutai” and “China’s Disney $Walt Disney(DIS)$ ” by the market.
Source: Google Finance
But what is the business logic behind Pop Mart’s rise in both the toy industry and capital markets? Is this meteoric rise a fleeting fad—or the start of the next global entertainment empire?
The Logic Behind Pop Mart's Breakout Success
Pop Mart is one of China’s leading designer toy retail brands, aiming to build a lifestyle and culture brand centered around intellectual properties (IP). The company collaborates with a wide range of artists to develop its own IP portfolio—including Labubu, Molly, and others—while also working with third-party licensed IPs like Disney and Sanrio. Most of its products are sold in the form of blind boxes, and the company operates an extensive retail network that includes offline stores, robotic vending machines, and e-commerce platforms.
At the heart of Pop Mart’s strategy are its IP incubation model and blind box mechanics, which together form the foundation of the brand's positioning. What pushed the brand into global stardom, however, was its highly effective international marketing strategy.
Pop Mart’s IP design breaks the mold of traditional cartoon characters. From the start, the company worked with a variety of independent artists to co-create its IP lineup. Its top characters often eschew perfection and sunshine in favor of emotion, imperfection, and eccentricity—including features like fangs, dark circles, a dazed expression, or cold demeanor. This distinctiveness helps the characters resonate with consumers, especially Gen Z, whose tastes are shifting toward anti-mainstream aesthetics.
SkullPanda series
The blind box mechanism is arguably the most talked-about component of Pop Mart’s sales strategy—and one of the key drivers behind its virality. This system combines randomized rewards with scarcity marketing, creating a “sense of achievement” when customers pull their desired figure. It also encourages repeat purchases and high retention. Hidden and limited-edition variants are extremely rare and often resell at high premiums in secondary markets, giving the products investment potential and even a sense of financial utility, further fueling the urge to collect.
The company’s ability to replicate this combination of IP storytelling and blind box mechanics across global markets has been the key catalyst for its recent breakthrough. Pop Mart initially entered overseas markets through low-cost channels like vending machines and pop-up stores, gradually building brand recognition. It then moved quickly to launch standalone stores and regional exclusives that further boosted Labubu’s appeal. Meanwhile, short-form video platforms like TikTok and Instagram played a vital role—creating viral opening videos and unboxing experiences that added emotional and social value to the product.
At a time of rising geopolitical tensions and trade disputes, Pop Mart’s success abroad has been hailed as a symbol of China’s soft cultural power, enhancing the brand's domestic reputation and further driving sales in China.
Outlook and Risks
While Pop Mart’s recent success is rooted in the precision of its IP design and marketing strategy, it also benefitted from a combination of timing, cultural trends, and external conditions. Whether this moment is a fleeting trend or the start of something much larger—possibly China’s answer to Disney—remains to be seen.
The most critical challenge ahead is sustaining the popularity of its IPs. Emotion-driven IPs may experience shorter life cycles, and existing hits like Labubu may eventually suffer from fatigue and diminishing appeal. To address this, the company must continuously create new “hit” IPs, a process that is both costly and creatively demanding. More realistically, Pop Mart may maintain momentum by expanding the derivative potential of existing IPs, such as through fashion accessories, new toy categories, or lifestyle products.
However, building long-term brand value will require a Disney-style approach—developing animated series, games, theme parks, and other entertainment-driven ecosystems that can consistently rejuvenate the emotional bond between the IP and its fans.
Additionally, Pop Mart’s core blind box strategy carries regulatory risks. Public criticism has emerged, especially concerning its addictive nature and potential to appeal to underage users. It is likely that regulators will introduce guidelines—such as requiring odds transparency or age restrictions—which could reduce the emotional thrill and engagement associated with the blind box experience.
Invesight Viewpoint
From a quirky little monster to a global cultural icon, Labubu’s rise is not just a testament to Pop Mart’s $POP MART(09992)$ commercial prowess—it is a milestone for China’s original IP industry. For the first time, a homegrown Chinese character has made a serious impact on global pop culture through the combined power of emotional storytelling and aesthetic resonance.
Labubu’s success may just be the beginning. Pop Mart’s long-term value will ultimately hinge on whether it can build a sustainable IP incubation ecosystem, lead trends in aesthetic and emotional design, and create a universe of rich, cross-media content behind each IP. Only then can it evolve from a "hit-making machine" into a Disney-like IP empire—and establish a lasting legacy on the global cultural stage.
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