Blind boxes crack success code

Pop Mart's trendy toys gain popularity among the world's young female consumers

Even till the end of September 2019, Beijing-headquartered Pop Mart, a company that makes trendy toys packaged randomly in what are called blind boxes or mystery boxes, hardly had any cross-border e-commerce presence.

Fast forward to last year's Singles Day shopping festival from Nov 1 to Nov 11－Pop Mart topped the sales in the action and toy figures category on AliExpress, a cross-border e-commerce platform based in China.

Sales on Tmall alone clocked 142 million yuan ($22 million), exceeding that of global toy brands, including Disney and Lego.

Exactly a month later, when it made its IPO in Hong Kong, Pop Mart's shares were oversubscribed by 356 times, valuing the company at more than HK$100 billion ($12.9 billion) on its first day of trading.

It confirmed the company's founder Wang Ning, 33, a billionaire now with a 57 percent stake, was not joking when he said he would like to make Pop Mart the Chinese equivalent of Disney or Netflix.

Next up: an ambitious plan to make the Chinese toys globally popular riding online social networks, overseas Chinese communities and Asian consumers.

The meteoric rise of Pop Mart appears unstoppable. That is surprising because the retail format of selling toys packed in blind boxes actually started in Japan.

In China, the company's products retail at about $9 each on average, and are widely popular. An unidentified loyal collector of Pop Mart's toys told Forbes magazine: "Blind boxes are so much different from what I have seen in the past. I like the toys' design, and the experience is a bit of a guess."

According to CBNData's report on the 2020 cross-border export consumption trend, online spending on blind boxes of various Chinese toy brands saw an explosive growth of more than 400 percent last year, with sales seen in more than 120 countries and regions. Female consumers accounted for about 75 percent of toy buyers, and young consumers aged 18-34 generated 78 percent of sales.

Justin Moon (Moon Duk Il), vice-president of Pop Mart and head of its overseas business center, said the company established joint ventures in fast-growing markets like Singapore, South Korea and Japan.

Its sales network now covers 21 countries and regions. The figure could have been higher but for the COVID-19 pandemic that led to postponement of some store openings overseas last year.

Pop Mart's overseas sales across wholesale, retail and e-commerce channels reflect the pandemic's impact on local retail in every overseas market it operates in, said Moon.

Thankfully, the new year 2021 has seen sales via e-commerce gathering momentum, particularly on Pop Mart's official e-outlets on platforms such as AliExpress.

Be it the domestic market or overseas markets, Pop Mart's patrons tend to be the younger generation born after 1995, tech-savvy, inclusive and curious about fresh ideas, Moon said.

Most of its fans are located in Asia and North America. European and Russian consumers prefer to buy Pop Mart products on AliExpress, while North American consumers prefer to choose official websites and Amazon.

Localization is key to success, said Moon, who leads a team of around 40 employees hailing from different nations at the company's headquarters in Beijing.