Overseas Frenzy: Pop Mart Faces Challenges Amid Rising Demand

At Central World mall in Bangkok, Thailand, the queue had already stretched over a hundred meters by 6 a.m. A 74-year-old Thai woman, supported by her caregiver, joined the line to secure the newly released Labubu plush keychain from Pop Mart. Just a week prior, she had spent a substantial sum purchasing the entire series as gifts for her company’s annual meeting. Meanwhile, 9,533 kilometers away at Westfield shopping center in London, fervent fans competing for the limited edition Labubu triggered physical altercations, forcing security to intervene and restore order.

Such extraordinary scenes are now unfolding worldwide. In Century City, Los Angeles, young consumers wrapped in blankets were waiting at 4 a.m. for the launch of Labubu’s third generation. Retail outlets in Milan, Italy, and London’s Covent Garden repeatedly recorded daily sales exceeding one million yuan.

These phenomena signify the emergence of a “Disney-level” cultural icon in China’s toy industry. Pop Mart has leveraged plastic blind boxes and plush toys to disrupt the global collectible toy market once dominated by Lego and Bandai. This represents a new milestone for Chinese cultural products, following the global sensation of Ne Zha 2 earlier this year, confirming recognition by international consumers.

Notably, Pop Mart’s success has sparked a surge in registrations of “trendy toy” enterprises. According to Tianyancha, by the end of May, 26,800 such companies existed in China. In the first four months of this year alone, 3,319 new registrations were recorded, a 48.2% increase compared to the same period last year.

It is no surprise that some retail investors on stock forums are envisioning an optimistic future, commenting, “Breaking 500, then 1000, our wealth freedom depends on Pop Mart…” Some even regard Pop Mart as one of the “Four Heavenly Kings” of the Hong Kong stock market. Driven by global popularity, Pop Mart’s share price has surged 900% within one year. At the time of writing, its market capitalization surpassed HKD 314.2 billion, making it a standout counter-cyclical success amid the current consumer sector downturn.

However, beneath the hype, the collectible toy market faces complex challenges that could undermine the brand’s long-term prospects. Speculators have inflated prices for limited editions, turning hidden variants into luxury-like assets and financial products. Hunger marketing strategies collide with rampant counterfeit goods, some of which command higher prices than originals, complicating consumer protection efforts.

These issues have raised concerns among industry observers: how can this Beijing-based toy company maintain its “phenomenon-level” status and avoid bursting the bubble?

Objectively, the emergence of globally impactful products within China’s toy and broader cultural industries remains rare. Much credit goes to Pop Mart’s founder, Wang Ning. Born in 1987 in Xinxiang, Henan Province, Wang’s entrepreneurial spirit was nurtured in a family operating a music and video store. While peers indulged in summer vacations after college entrance exams, he launched a football training class, recognizing that parents preferred sports over gaming—a simple but insightful understanding that ignited his commercial thinking. During university, his “Days Studio” produced CDs chronicling campus life, completing the full chain from creative planning to sales and after-sales service, laying the foundation for Pop Mart.

In 2010, Wang experienced a turning point visiting Hong Kong’s LOG-ON, a lifestyle store combining trendy products. Mainland China lacked the concept of “creative products” then, prompting him to resign from Sina and open Pop Mart’s first store in Beijing’s Zhongguancun. Early days were tough; high-paid store managers and their teams resigned en masse.

The breakthrough came during a 2015 trip to Tokyo. There, Sonny Angel figurines, palm-sized and sold through “lucky bag” blind purchases, achieved monthly sales of 100,000 units, signaling a significant opportunity.

In 2016, Pop Mart signed Hong Kong designer Kenny to create Molly—a blonde, pouty little girl character whose emotional resonance attracted users across demographics. For instance, a 60-year-old woman recalled her daughter’s childhood through Molly, while young consumers adopted the character as a personal symbol. Coupled with blind box mechanisms that included hidden variants as rare as 1 in 720, the company turned profitable that year.

By December 2020, Pop Mart went public on the Hong Kong Stock Exchange, briefly surpassing HKD 100 billion in market value.

International expansion quietly began in 2018. Wang selected Seoul as the first overseas market, but real progress came through strategic penetration into Southeast Asia. In 2021, Pop Mart used Singapore as a pilot market and two years later partnered with Thailand’s Minor Group to open a flagship store at Bangkok’s Central World.

Initial growth was gradual until April 2024, when Thai superstar Lisa posted photos of Labubu plush keychains on Instagram over three consecutive days, triggering a social media storm. Labubu charms even appeared dangling from the Hermès bags of Thai royalty. Scalpers hiked prices from the original 99 yuan to 634 yuan, and the Mega Bangna themed store in Bangkok achieved daily revenues exceeding 10 million yuan.

The key to success lies in attention to detail. First, the industrialization of emotional value: Labubu’s design—a Nordic elf with devilish fangs and plush texture—resonates with Gen Z’s dual desire for individuality and companionship. Consumers attach these figures to backpacks, suit jackets, or even bring them to workplaces.

Second, local adaptation is vital. In Thailand, Pop Mart co-created the IP Crybaby with local artist Molly; in Argentina, Messi-themed editions command premium prices; in the Philippines, store inventory cycles align precisely with bi-monthly payroll schedules.

Third, the direct-to-consumer (DTC) model disrupts traditional toy distribution. Mainland China’s store count increased from 363 at the end of 2023 to 401 in 2024, with offline revenue rising from 2.66 billion yuan to 3.83 billion yuan—a 43.9% year-over-year increase. Average store revenue is projected to grow 30% in 2024. Internationally, Pop Mart operates 130 stores and 192 robotic vending machines, generating 3.07 billion yuan in offline channel revenue—a 359.6% year-over-year surge.

Given this momentum, Pop Mart confidently declares its ambition “to recreate Pop Mart overseas.”

Yet the “London brawl incident” spotlighted structural fissures beneath the celebration. As consumers fought over Labubu products, core tensions within Pop Mart surfaced.

The gambling-like dependency and trust issues surrounding blind boxes are central concerns. It is critical to note that blind boxes are essentially variants of probability-based games. Labubu’s macaron series hidden variants command 877% premiums on the secondary market, while Vans collaborations reach 1,284%. While these designs cleverly stimulate dopamine release, they also attract regulatory scrutiny.

Since 2022, China’s blind box market has cooled, with membership repurchase rates declining from 58% in 2019 to 49.4% in 2023. More problematic, scalpers employing automated software monopolize hot products, making purchases difficult for ordinary buyers. Bangkok store employees witnessed delivery workers snatching freshly stocked Labubu items, yet purchasing limits rendered them powerless to intervene. When scarcity shifts from marketing tactic to trust breaker, the emotional business is at risk.

IP anxiety and cultural dilution further complicate matters. Despite holding 13 IPs with annual revenues exceeding 100 million yuan, the lifecycle of hits shows signs of plateauing. Labubu, designed in 2015, took seven years to explode due to celebrity endorsement; CRYBABY achieved a record 1,537% growth but remains an incubated IP with unpredictable success. Compared to Disney’s comprehensive “film-park-merchandise” narrative, Pop Mart functions more as a supplier of symbolic tokens.

A deeper challenge lies in cultural depth. Despite plans to launch Labubu animated shorts, the fragmented IP portfolio lacks a cohesive worldview. Morgan Stanley described Pop Mart as a hybrid of “Bandai + Lego + Disney,” but where Bandai channels passion through Dragon Ball, and Lego conveys creativity through blocks, Pop Mart’s emotional core remains relatively thin.

The sensitive capital market has taken note. The stock’s exuberance masks early investors exiting: Fengqiao Capital cashed out HKD 2.1 billion at peak prices. Institutional sell-offs contrasted with retail buying create a precarious balance. While profit-taking by early backers is understandable, capital flight raises doubts about Pop Mart’s outlook.

From a broader perspective, Pop Mart’s rise coincides with a new inflection point in global economic consumption. Declining birth rates and single-person households fuel emotional consumption; younger consumers are increasingly willing to pay small amounts for personal joy. In essence, Pop Mart does not merely sell toys but miniature emotional vessels combating social atomization.

However, as celebrity endorsements fade, global regulations tighten on blind boxes, and IP incubation lags consumption, the question remains: can Pop Mart sustain its ability to evoke global emotional resonance? Business strategies can be calculated, but genuine human connection requires serendipity and surprise—even if embodied by a small collectible monster.