Check out why it is a big hit among Chinese consumers. You may draw some inspiration on communicating with the group, especially on how to leverage Chinese social media to create buzz.

How Popular Is Air Fryer?

The popularity of air fryers not only exists in China, but it is also a global phenomenon. Based on Euromonitor’s data, the market scale of air fryers reached $2.3 billion in 2021. It is expected to be $3.6 billion by 2026.

In terms of the China market, JD sold over 1.2 million air fryers in January 2022. It was a 360% YOY growth with sales revenue over 460 million RMB. It turned out to be the peak of JD air fryers in the last two years.

Chinese young people show great interest in home appliances. GKURC finds that in China, dish-washing machines (37.41%) and air fryers (25.11%) are the two home appliances that most Gen Z desire to buy. They may not be good at cooking but are looking for homemade food, and air fryers satisfy their needs perfectly.

Why Have Air Fryers Become a Trendy Item for Chinese Consumers to Have?

Air fryers were created in the 1990s in America. It was not until 2015 that the home appliance was introduced to the China market by some of the leading companies in the industry, such as Joyoung (九阳) and the Midea Group (美的).

The first couple of years after it was brought to China, most people didn’t hear of air fryers. The turning point came to 2020 when it started to be massively mentioned on Chinese social media. Why?

The Outbreak of Covid-19

Covid-19 resulted in the lockdown of many places back in 2020. While staying at home, people started to pay attention to health, and homemade food became popular. The demand for small home appliances increased significantly during this period, with a sales volume rising by 11% globally.

China recovered from Covid earlier than most countries did, and thus, international production orders were handed over to Chinese manufacturers. This boosted the development of many OEM (Original Equipment Manufacturer) and ODM (Original Design Manufacturer) home appliances factories in China.

Social Media Spread

Social media has become an effective way to educate people on a new product. When platforms such as Little Red Book, Douyin, and Weibo are talking about air fryers and seeing how easy it is for freshers to start with, people are flipped.

While browsing related content online, people tend to think that they can make such a dish by themselves. Social media content delivers the message to people that air fryers are easy to control and everyone can be a chef by using them. After successfully making a dish with air fryers, people are often cheered up and tend to “brag about” their experiments on social media. So air fryers-related UGC (User-generated Content) keeps coming up on social media to increase its exposure.

Besides traditional formats, air fryers are also presentable on livestream. It is easy for brands to showcase the steps to operate an air fryer and to present their “magic power.” On one of Austin Li’s livestreams, air fryers were sold out in one second after the sales began.

The Booming of Single Economy

The number of people who live alone in China has increased rapidly. About 92 million Chinese people live by themselves, which equals the population in Germany. Based on a Cyanhill Capital (青山资本) report, it only took 20 years for the percentage of solitude to grow from 6% to 25%.

To please themselves, they are seeking choices more than having instant noodles or ordering takeaway foods. People want to cook something at home that is healthy, delicious, and doesn’t take too many steps. Air fryers seem to be a perfect choice.

Other Reasons

Air fryers are healthier than the traditional ways of frying foods. Philips claimed that the fat from the French fries that its air fryers made is 80% less than the fryers.

Compared with ovens, air fryers take less space. It also frees users’ hands, who can continue their work, read books, and play games while the air fryer is cooking.

Concerns Chinese Consumers Have for Air Fryers

Due to the rising demand and imitability of air fryers, many factories joined the industry. But some of them pursue quantity over quality, which results in their air fryers’ poor performance. Since their production processes are simplified, they sell air fryers at way lower prices, which disrupts the industry with a price war.

Accompanied with air fryers’ prevalence in China, voices are questioning the health issue of the home appliance. In 2021, the Hong Kong Consumer Council pointed out that foods cooked by air fryers can lead to cancer. Though many KOLs stand out to clarify that it is not necessarily true, it still concerns many Chinese consumers.

The post Air Fryers Evoke a Cooking Wave Among Chinese Consumers appeared first on China Marketing Insights.

One month after she appeared publicly, she was on Weibo’s hot topic ranking board more than 32 times. That popularity is something that not many celebrities or KOLs are able to achieve in their entire career. Yet LinaBell made it just in one month.

Who is she? What makes her a huge superstar among Chinese people, especially girls? What commercial plans are hiding behind her?

New Member of the Duffy Family from Disney: LinaBell

LinaBell is a fox! She’s a new member of the Duffy Family from Disney, introduced in September. Here is her cute background story. So Duffy was playing around in a forest and he got lost. When he was about to panic, LinaBell showed up with her iconic magnifier, and guided Duffy out of the forest.

Her character is set to be brave, outgoing and she’s a fox with endless curiosity to explore the world. She loves adventures.

Currently, you can only find LinaBell in Shanghai Disneyland. She will be introduced in Hongkong and Tokyo Disney in the near future.

What Makes LinaBell a Huge Celebrity?

Her Popularity

On the first launching day of LinaBell’s products, people had to wait in line for seven hours so as to get one. And to take a picture with LinaBell, people often line up for three hours.

LinaBell’s products are ALWAYS out of stock, including her dolls in different sizes and her blankets. People’s crazy desire to get her products are often taken advantage of by “Huang Niu” or scalpers. A keychain of LinaBell doll which is 119 RMB, is sold at nearly 2,299 RMB on collectible resale platform Dewu.

On November 24, Shanghai Disney published the announcement that the Christmas collections of Duffy Family would be launched on November 29, along with LinaBell’s dolls! That’s a big news for LinaBell’s fans and the scalpers. Immediately, scalpers were hiring people in WeChat groups, looking for people to rush to Shanghai Disney on the launch day. 

Some people go the opposite way to produce fake LinaBell merchandise. There are people on social media platforms to help LinaBell’s lovers to identify the authenticity of their dolls.

Cute Look of LinaBell

LinaBell is cute. She is a fox with a soft pink color and fluffy clothes. Her big and seemly-warm tail also makes girls scream every time she turns her back to the audience and shakes it. But obviously, what makes LinaBell’s popularity last long and continue to increase is her character.

LinaBell’s Brave Character

Unlike many other Disney characters, the setting of LinaBell’s personality is different. She has many dimensions. Sometimes she is being cute, shy, and sometimes she’s being angry to show her dislike.

When visitors say something that she doesn’t like, she would pretend to pull out her sword. When she sees handsome boys, she becomes shy and wants to hug them. She’s also very sporty, showing fans how she lifts dumbbell to strengthen her body. When fans are complaining that her products are often out of stock, she pretends to write letters to the manufacturer and call related people. She even starts to thread the sewing machine and pluck out her own fur to shape a small LinaBell.

She’s alive for fans.

Disney’s Commercial Plan behind LinaBell

Creating Idols without Film and Television Works

Think about classic Disney characters such as Mickey Mouse, Donald Duck or Simba, they all have movies to complete their personalities. Yet, the Duffy Family doesn’t. They were created and rely on people who play inside the costumes to make them alive.

Duffy’s story is a good example for LinaBell. He first showed up in an American Disneyland in 2004, and he wasn’t even had a name back then, and was called “Disney Bear”. After he was introduced to the Tokyo Disney, the local team proposed a new name for him: Duffy, and put him in sailor suits. Together with fabricated stories behind the bear, Duffy quickly gained huge popularity and it continues nowadays.

Disney realized that a character doesn’t necessarily need to appear in movies, a character just needs a personality.

Following Duffy, we see more and more family members being created. So now, the Duffy Family has seven members, or “idols”. Those characters help Disney make great revenues by selling their peripheral products. It is estimated that the amount of StellaLou, the purple rabbit in the Duffy Family, sold by Shanghai Disney in three years is equal to 119 Mount Qomolangma if you pile them up. This rabbit even has its own color named by its fans, which is called the StellaLou Purple.

An Effective Weapon against the Beijing Universal Studios

The opening of the Beijing Universal Studios in September 2021 definitely drags away lots of traffic from Shanghai Disneyland. What might also become threatening for Disney is that, the Megatron in the Universal Studios is so talkative when taking photos with visitors, and thus, he has attracted many people to go to the park and interact with him. He is popular as well.

StellaLou is still popular and yet, people were not as crazy as before. Disney needs a new character to give visitors more reasons to come and spend money on its products. According to The Paper, the revenue of Disney’s tickets only takes up 30% of its total revenue, and the park largely depends on second consumption, which is by selling its IPs’ products. 

A nice try, Disney!

Our Thoughts

Though without film works, an IP has a lower threshold for fans to get to know them. What it requires for them to become popular is mostly their looks. However, without background television works, fans might not have as deep engagement with those IPs as they have for Mickey or Donald Duck.

(But with LinaBell in Disney, I am planning to buy an annual card of the Shanghai Disneyland and to visit her frequently!)

The post Who Is LinaBell And Why Is She A Big Hit Among Chinese Girls? appeared first on China Marketing Insights.

According to a data monitoring platform Fan Ruan (帆软), the MAU (Monthly Active User) of Dewu in May 2021 reached 81M, which was 8% month-over-month growth. Over half of its DAU (Daily Active User) are post-90s. On Dewu, the percentage of male and female users is 52:48. This is very different from Red, whose majority of users are females.

Who is this competitive player in the industry? Why can it attract so many young people to download and actively engage with it? And how can brands leverage it?

The Background of Dewu

One of the reasons why the app gained so many male users is that it used to be mainly sneakers and toys oriented. Not children’s toys, but art toys and collectibles that only “it” people would have, such as the popular bearbrick.

In 2015, the app was created. In the same year, it launched a new function, which was not common at that time, identifying shoes. This appeals a lot to people, especially boys who love sneakers, no matter if they are collecting, or wearing, or buying and selling them. Two years later in 2017, Dewu introduced the sales function. Users were able to buy not only sneakers and toys, but also apparels, beauty products, bags, watches or even home appliances on it.

There are gossips about why the platform changed its name from Du to Dewu in 2020. My thinking is, Du represents poison in Chinese. This is not cool as the name is suggesting something that the law forbids. Second, by reading Du, potential consumers won’t know what the platform is about. By giving the name as Dewu, which in Chinese means someone buys/gets something, it is easy to understand what the platform is. Your thoughts?

What Makes Dewu a Gen Z Hub?

As mentioned, the majority of Dewu’s users are young people, which are the Gen Z. Based on McKinsey’s report of Gen Z in APAC, 40% of the group love brands that can make them different from others. The percentage is twice the scale of Gen X (people born between 1965 to 1980). It is 1.3 to 1.5 times the scale of Gen Y (people born between 1980 to 1995).

When it comes to China, 61% of Gen Z are discovering brands that can make them different. Therefore Dewu is a platform that helps Gen Z satisfy their needs. Most of the brands on Dewu are streetwear brands. Some of them are niche ones that only a small group of people know. This gives this group of people a sense of belonging to find someone that is also paying attention to these niche brands.

What’s the Commercial Prospect of Dewu?

Liu Jianhai (刘建海), founder of a creative agency White Wall, believes that at the moment, the style of short videos on Dewu is still in the early development stage. Image and word posts dominate the Dewu UGC community. However, there is a rise in the number of user-generated videos. In the future, videos might be the mainstream content on Dewu, and users will spend more time on the platform.

Officially, Dewu is encouraging users to create more high-quality content. Recently it just launched a plan named “Giving Video MCNs Bonus”. If videos posted by MCNs satisfy Dewu’s rules, it will offer the MCN a maximum of 8.5 million traffic every month. As individuals, if you have a follower base somewhere over 500 people, Dewu might offer your video at most 600k traffic in the first month after you register on the platform.

This is a big opportunity for content creators. Unlike Red or Weibo and many other social media platforms that are now saturated, Dewu is still in its early stage of business development, which means that it is still providing incentives to both content creators and brands to share content on the platform.  

Not much advertisement

Dewu won’t define your content as hard advertisement even you talk a lot about a specific product in the post. Instead, your post might have a chance to be recommended by the system because of the authenticity and useful information that it delivers. Dewu would love to define your post as viral content.

On Dewu, posts with over 1,000 likes are counted as viral.

Lower cost to work with KOLs on Dewu

To work with a KOL that has around 60k followers on Dewu, it only costs 500 RMB for brands. With such a lower price, the conversion rate could be impressive as many users have the habit to purchase products through links provided by the KOL at the bottom of the post.

For every order that users purchased through links that KOLs provide, the source and amount can be tracked, and thus, KOLs can have commission from users’ buying behaviors. Some KOLs have half of their monthly income through commission.  

I would say Dewu’s users are younger than Red’s, and most of them are also active Douyin users. If your brand targets millennials or Gen Z, Dewu is an ideal platform to consider, with a lower budget. 

Read more: Z世代为什么中了「得物」的毒？

The post Chinese Young People’s New Love: E-commerce App Dewu appeared first on China Marketing Insights.

The collaboration was to launch Beast’s new fragrance Panda Poo Poo (not sure who thought of that name…). Consumers who bought Manner’s Panda Latte and post its picture on WeChat can get a small bag, I mean tiny bag, with a sample of the fragrance.

I saw it on social media and decided to buy a cup of coffee and get the bag, because it is so cute! At first, I went to the Manner store close to my workplace, but I was told that they had run out of the gifts. I was so disappointed, but this made me even more motivated to get the gift. And I did it, at another store.

Why Was the Manner Coffee x Beast Campaign so Popular?

Why did this campaign become so viral both online and offline?

One reason is the drink itself. The Panda Latte is inspired by Beast’s new fragrance collection Panda Poo Poo (熊猫噗噗, maybe better translated as “a Puff of Panda” or “a Whiff of Panda”). The Manner coffee drink is a translation of the fragrance’s smell into flavors.

The scent of “Panda Latte” is divided into top, middle, and base:

• Top: Green apple, banana, and pear
• Middle: Elderberry and gooseberry leaf
• Base: Honey, vanilla, and wood

Another reason the campaign got so much buzz is that Manner Coffee is popular among white collar workers in top tier cities, and anything the brand does easily grabs people’s attention.

We’ve talked a bit about the brand in our previous article when mentioning competitive players in the beverage industry in China. Today, we want to dig more into the brand, and find out why white collars favor it so much.

About Manner Coffee

Manner was founded in 2015. Before that, its founder Han Yulong (韩玉龙) opened a coffee store in Nantong (南通), but it turns out that people in Nantong didn’t have that much passion for coffee, so Han moved to Shanghai.

With limited budget and considering the fact that the coffee business has a lower table turnover rate, Han’s first Shanghai coffee store was only 2 square meters, with very simple decoration.

But despite the small space, it did well. In 2019, Manner started marching aggressively, opening more stores in Shanghai as well as in other cities. Now the brand has 137 stores in Shanghai and 14 additional stores in Beijing, Suzhou, Chengdu, and Shenzhen. 

Manner is getting noticed by investors. In 2018, it received its A round of financing. And just recently, it was financed by H Capital and Coatue, and Manner Coffee is now worth 1 billion USD.

What Makes Manner Coffee So Popular Among Chinese White Collars?

High quality and good taste of Manner Coffee

Though Manner’s stores are often tiny, Han has strict requirements for Manner’s products. Those stores are equipped with expensive coffee machines, such as La Marzocco gs3, Mahlkonig and Robur from Mazzer. They even have a professional water filter to provide clean and free drinking water for customers.

Manner launches seasonal drinks once a month. This makes sure that customers can always taste something new from the store and they won’t get bored with Manner and turn to other brands.

Affordable prices

Han does whatever he can to lower costs for his stores and products, so as to provide affordable prices for Manner’s customers.

To reduce the spending on coffee cups, Manner offers a 5 RMB discount if customers bring their own cups. That is a pretty motivating offer! And it also ties into young consumers’ growing interest in sustainability. And if you want to buy its coffee beans, which are mostly from Yunnan Province (云南), you can have an 18 RMB discounts on the beans.

The average price of Manner’s coffee is around 15-20 RMB. It is way lower than other players in the market such as Starbucks, Peet’s or Costa. One of the benefits of having a lower price is that it actually lowers consumers’ expectations so that then when they first try out the coffee they are pleasantly surprised that the quality is better than what they thought they would get for that price. And if they feel that the coffee is not tasty, it’s fine. After all, it only costs around 20 RMB.

No delivery service

Han knows clearly that as time goes by, the flavor of coffee changes. As the temperature decreases, the sour taste becomes stronger and the smoothness decreases. The cup of coffee is very likely to become bitter.

Though offering delivery service will definitely bring more sales for Manner Coffee, Han doesn’t feel the benefit of additional revenue is worth risking the reputation of the brand.

Plus, if a coffee store wants to have good delivery service, it must be equipped with fast logistics. For example, Starbucks has its own takeaway service called Zhuan Xing Song (专星送), which is the collaboration with Eleme (饿了么). From ordering to receiving coffee, it only takes 18 minutes. However, not every coffee house is capable of achieving this speed as it requires more capital investment.

Location & decoration

Most of Manner’s stores are small and they are located either near or inside office buildings. This allows white collars to order first on their phones and pick up their coffee on their way to work.

With its affordable prices and good taste, and attention-grabbing, convenient locations, Manner quickly became many people’s go-to choice.

Our Thoughts

While the coffee industry is still in a nascent stage in many other cities in China, it has already been incorporated many Shanghai city dwellers’ daily lives. Based on a Shanghai coffee report published by CBNData (上海咖啡消费指数), for every 10k people Shanghai has 2.85 coffee stores. The number has reached the coffee consumption level of London, New York and Tokyo.

While it seems ambitious to launch a new coffee brand in an already crowded market, Han knew from initially launching the store in Nantong that the brand would never succeed in a market where he also had to create demand and educate consumers. Instead, he made the right choice by going into a crowded market but then finding clear ways to differentiate his brand.

Read more:

从2㎡小店到估值超10亿美元，Manner Coffee 经历了啥？

四年开店超50家的manner coffee,做对了什么？

Manner火爆，瑞幸的另一个极端

MANNER 联名野兽派推出熊猫拿铁

The post How Manner Coffee Broke Through China’s Crowded Beverage Industry appeared first on China Marketing Insights.

Though it is still a niche hobby, more and more young people have begun experimenting with POPMART DIY.

Why are POPMART Toys Popular for DIY?

POPMART is popular among Chinese young people

POPMART was founded in 2010. It really took off around 2016 and the company filed an IPO in 2020. Rocket speed.

Besides its cute IPs and toys, what people love about it is the blind box idea. You know that’s something you like inside, but you are not sure which toy you will get from the collection. That’s the charm of the unboxing process. It is easy to get addicted to it.

POPMART positions itself as a trendy pop toy brand like be@rbrick. Usually, pop toys cost more than ordinary ones, and their prices range from several hundred RMB to thousands of RMB, and they are often limited. But with POPMART, a typical toy only costs 59 RMB, some are a bit higher but they are no more than 100 RMB. Therefore in terms of DIY, it also costs less to make mistakes. And that’s one of the reasons why the brand is favored by those DIY designers.

POPMART’s IPs are not attached with specific emotions

The brand has many IPs with different characters. For example, its most popular IP is Molly, is a girl who loves cosplay and often has all sorts of interesting ideas. Dimoo, on the other hand, is a boy who are a bit funny but introverted; Skull Panda is a girl who can visit space using magical power and she looks a bit goth (in a cute way).

Those IPs have different identities. However, they are not defined with any emotion or mood. This gives those DIY designers room to picture their imagination and turn it into reality on those toys. Also, because POPMART’s IPs are popular, it is like trend-jacking or news-jacking. Those DIY toys gain attention online naturally and quickly.

DIY Pop Toys are Beneficial for POPMART’s Future

Writing this article reminds me of another one in which we talked about the importance of UGC. The article is about how Honey Snow City’s song overshadowed Nayuki Tea’s IPO.

POPMART is lucky that this niche community of talented DIY-ers are creating more buzz about the brand. It’s hard to find something that can trigger people to post about your brand, let alone voluntarily spending hours DIY-ing your products and posting their amazing creations.

DIY designers inspire POPMART’s designers to work harder

This is a blunt way to say but it’s true, as DIY designers create amazing works.

Yan Wuhao (言吾豪) is one of those popular POPMART DIY designers. He has signed with an MCN called Paqu (葩趣), which belongs to POPMART. Yan loves creating toys in series. For example, he once used Dimoo toys to create a few characters from a viral mobile game Honor of Kings. The series is very welcomed, and it has 5,394 likes on Little Red Book, while the average likes of his other posts are between 100-1,000. A collection or a series is also something that people can follow and build up connections with the designer.  Yan says it is a good thing for the DIY industry to develop as it will push POPMART’s own designers to work harder and gives them different angles and inspiration.

POPMART focusing on finding new talent and diversifying top IPs

POPMART knows it needs to constantly be adding new IPs to keep consumers interested.  Like we mentioned before, its most popular IP is Molly. In 2019, the IP helped the brand generate 456 million RMB, taking up 27.1% of its total revenue. But in 2020, Molly’s contribution decreased to 357 million RMB sales, which was only 14.2% of the total amount. This was largely because POPMART added many new IPs and those began to take up a larger share of the company’s revenue.

Together with the rise of a bunch of talented DIY designers, POPMART has been working hard in creating new IPs. The Skull Panda collection that we mentioned before was launched in 2020. The girl doesn’t look like sunshine but very sad and quirky. And this is the point that wins so many young people’s love.

Just one second after it was launched on Tmall, its sales quickly broke 3 million RMB and all of the collection’s stock was sold out on that day. Within three months, the IP had contributed nearly 40 million RMB sales, and consumers often find it hard to get one. Have you bought POPMART before? What do you think about its future?

Read more: 沉迷“改娃”的年轻人和背后的泡泡玛特

The post DIY-ing is the Newest Phase of China’s POPMART Craze appeared first on China Marketing Insights.

POPMART Didn’t Offer Discounts From the Beginning

POPMART creates collectible pop art toys. Its main consumers are not children, but Gen Z and millennials between ages 18 to 35. They are mostly white collar workers and 70% of them are females. Its consumers match with Taobao’s livestream audience.

In May 2019, POPMART started testing out the waters, running a livestream itself, not with KOLs. While livestreaming truly became mainstream in 2020, it was already quite popular in 2020 and many brands were using the format as the main way to drive sales. 

During POPMART’s first livestream, unlike other brands that offer discounts, the prices remained the same at 59 RMB. But even though it didn’t offer discounts, POPMART’s first livestream went well. In less than 2 hours sales reached nearly 70k RMB.

The brand was able to achieve this because of its fans’ loyalty. People who don’t like blind box toys just don’t like it. And for those who like it, they love it. Collecting pop toys is a niche hobby, and people who collect them feel like part of a community. This character makes them loyal to the brand. So even without lowering the price, people will still buy POPMART products. 

Singles Day 2019

Even with this initial success, POPMART didn’t have a regular live streaming schedule in 2019. But then Single’s Day hit and during the shopping festival POPMART held 4 livestreams. Together the streams achieved nearly 7 million RMB in sales. In half a year POPMART went from being able to sell 70K RMB in one stream to over 1.5 million RMB of toys in one stream. 

Following 2019, like every other brand, POPMART realized the importance of livestreaming. What’s more, COVID 19 hit and consumers couldn’t visit POPMART’s offline stores and vending machines. Since March 2020, the brand started regularly holding livestreams on Taobao Live. 

The goal of the livestreams is not only to drive sales, but to cultivate old customers’ brand loyalty and introduce the brand to new customers.

If There are No Discounts, What Do They Livestream About?

Wang Ning (王宁), the CEO of POPMART knows that by maintaining the same price on livestream it will be harder to drive sales. So he thinks of another way to save this: telling stories and introducing POPMART’s various IPs so that people understand them better and learn more about new IPs. Wang knows if there are 100 people, there will be 100 reasons for them to buy POPMART. Different toys attract different people and everyone has a different reason for a POPMART order.

POPMART also livestreams the unboxing process. This is exciting for people who love blind boxes. Just watch our unboxing video to see for yourself. 

The brand also livestreams about its rules for shopping festivals. Even though its product price remains the same, it gives bonus gifts to consumers during festivals and the gifts change depending on how much they spend. 

Livestream Campaign to Support a Wuhan Nurse

On March 6, POPMART held an unboxing livestream for a nurse who went to Wuhan to help. The nurse was a fan of POPMART and always had a dream of getting one of the hidden special edition boxes.  

So POPMART livestreamed its employees unboxing numerous boxes. In the end, they had found 7 hidden editions and they gave those to the nurse. They held lucky draws and gave away the rest of the opened toys to viewers of the stream. The livestream attracted 100k views which is quite high for a brand-run livestream. 

Read more:

别再好奇泡泡玛特为何市值千亿了，他们连直播都玩成这样了！

The Chinese Toy Brand That Surpassing Disney and Lego? Come and Meet Pop Mart!

The post How POPMART Leverages Livestreaming Without Discounting appeared first on China Marketing Insights.

Actually, Pop Mart was founded way back in 2010. At first, it only sold toys from the Hong Kong brand LOG-ON or from the Japan Loft, and it didn’t have its own IP. Things lasted like this until 2016, when it was inspired by a Japanese IP toy Sonny Angel and decided to start working with artists to create its own IP.  Pop Mart got the right to sell the Molly IP. Since then, the brand went viral. 

Despite COVID, 2020 was a very strong year for Pop Mart, capped off by an IPO in Hong Kong in December. Let’s look at some of the key takeaways from the report:

Earnings

Annual revenue was 2.51 billion RMB, 49.3% growth YoY, and they sold over 50 million toys. 

The adjusted net profit for 2020 was 590 million RMB. For comparison, 2017- 2019 profits were 1.56M RMB, 99.5M RMB and 451M RMB respectively.  

Diversification of Top IPs

Sales from top IPs are becoming more diversified and healthy. Why does this matter? Because Molly, Pop Mart’s top IP, used to contribute over a quarter of the company’s revenue. From the brand’s IPO prospectus, from 2017 to 2019, Molly generated 41M RMB, 214M RMB and 456M RMB respectively for Pop Mart, accounting for 25.9%, 41.6% and 27.1% of the company’s total revenue. 

This year, revenue from Molly has dropped to 14.2%. Following Molly are Dimoo (12.5%), Pucky (11.9%), and The Monsters (8.1%). The remaining 53.3% of sales comes from all other IPs. 

Other noteworthy IP stats: 

The “Day in the Life of Molly” collection that launched in August 2020 was a top seller, bringing in over 100 million RMB. 

Brand-new IP Skullpanda is off to a strong start. The first collection sold over 276,000 toys the first day. 

New IPs created through Pop Mart’s Pop Design Center brought in 100 million RMB. 

Online v.s Offline Sales Channels

Pop Mart now has a total of 187 offline stores, 76 of which were newly added in 2020, and a total of 1,351 Pop Mart vending machines, 526 of which were newly added in 2020. Offline sales increased 34.6% YoY.

Online sales reached 950 million RMB, making up 37.9% of total sales, up 76.5% YoY. 

During the 2020 Singles Day shopping festival , Pop Mart’s Tmall flagship store did 142 million RMB in sales, becoming the first company in the toy category on Tmall to break 100 million during 11.11.

International Expansion: 

Pop Mart is now selling in over 20 countries and regions. International sales increased 176% YoY. The first overseas store opened in Korea in September and since then they have opened several more including just recently launching its first store in Canada. 

Members: 

Pop Mart has 7.4 million registered members. 5.2 million of them were newly registered in 2020, an increase of 236% YoY. Sales from members make up 88.8% of total sales, an increase of 9.9% YoY. 

Events: 

In 2020, Pop Mart hosted the Shanghai International Pop Toys Exhibition with over 100,000 people in attendance, over 500 toy designers and 300 toy brands.

In November they also organized the first ever pop toy industry conference and published a report pop toy industry trends white paper. 

Why is Popmart so popular? 

So you’ve seen the great stats from the report, but why is Pop Mart so popular? 

People love collecting things and Pop Mart satisfies this need. And it does it with excitement by using blind boxes. This means that all toys in a series will come in the same box and consumers won’t know which toy they got until they open the box. 

Pop Mart is also an expert at creating scarcity. For every new series of toys that comes out, there is always a mystery toy that consumers have about a 1/140 chance of getting. Because they are so rare, people can resell them on second hand platform Xianyu (咸鱼) for nearly 40X the original price, for example it could be sold at 2,350 RMB and its original price is only 59 RMB.

Compared with other entertainment activities, buying Pop Mart toys is a low-cost, happy thing for people, especially young people who suffer from work-related stress and anxiety. They are so happy to embrace the uncertainty and excitement of opening. These toys can also be photographed and images can be shared to social media.

Check out our unboxing video to feel the excitement: 

Consumer Demographics

According to Frost & Sullivan research, 95% of blind box consumers are aged between 15 – 40, and they tend to have higher consumption ability. 

This is starting to shift though. A report from Alibaba shared that during this year’s Spring Festival, many consumers in their 40s and 50s purchased bind box toys for the first time, choosing items from Chinese zodiac collection as New Year’s gifts. 

Areas for Improvement

Pop Mart clearly identified the risk of too much reliance on the Molly IP and worked hard this past year to improve that. The other thing is, the company doesn’t tell good stories of its IPs. Stories can give vitality and personality for IPs and make people feel more attachment to them or interest in them.

Read more: 

深度｜上市首日暴涨的“泡泡玛特”，给时尚品牌带来什么机会？

财报 | POP MART 2020年度成绩单

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While this is true in many situations, in this fast-paced world, there is a case to be made for a deliberately “slow” approach. For example, there is a Chinese fragrance brand that is finding success by doing just that: To Summer or Guan Xia 观夏.

To Summer was founded in 2018, and it wasn’t until January 2019 that it launched its first product. The brand only promotes itself through its WeChat Official Account and occasionally  works with bloggers that match with its culture and tone. It only sells products through its WeChat mini program, and it only updates product inventory once a week, on Thursday night. If you are slow, then you might miss some of the viral products, for example, its mood crystal aroma diffuser priced at 389 RMB ($60 USD).

In addition to its various scents of beautifully packaged diffusers, To Summer also produces candles, body lotion and shampoo, perfume, and scented wax tablets.

To Summer is hitting the market at the perfect time, as a result of spending so much time indoors during COVID 19, Chinese consumers have started paying attention to improving their quality of living at home, whether that is through home decor, better appliances, or home fragrances. 

The brand is delivering a slow pace of living to its consumers. They want to shape every product as a sophisticatedly-designed magazine, to tell readers how to improve their life quality.

What makes To Summer’s products different?

The length of matchsticks

Matchsticks are usually short. When consumers are using them to light a candle, they get burned. So To Summer extended its matchsticks four times the length of other’s, aiming to let consumers light the candle elegantly.

Packaging

The packaging style is what To Summer called “new eastern modern”. They follow the rule of less is more and add eastern elements to the bottle, such as putting the characters “桂” “竹” “莲” (which means osmanthus, bamboo and lotus) boldly on the packaging.

Customization

Not many brands are customizing products for consumers. This is because it requires brands to customize labels and workers to manually label those stickers on bottles, and it costs extra manpower and material resources.

Because of the customizing service, many consumers buy it as a gift for someone else. 

Products that are giftable are excellent drivers of organic word of mouth marketing. After receiving this customized gift, people tend to share it on WeChat Moments, which attached warmth to To Summer’s products and lower the brand’s promotion budget.

Why does the brand only sell on Thursday night?

One of the reasons we just mention is the customization, which requires extra time and materials, but the core reason is the production circle.

Skincare or cosmetic products can be quickly produced once you confirm the package and ingredients, they will be manufactured in bulk with a mature supply chain and production chain in China. But China doesn’t have such a production line for high-end fragrance products.

For example, the stones found in To Summer’s mood crystal aroma are shipped from many countries including England, South Africa and U.S. After arriving, they will be processed in To Summer’s own studios, because in China, there is no factory that can handle such production line at the moment.

Even if some of the brand’s ingredients are native to China, to extract, the brand has to send those ingredients to France. The whole process involves many foreign companies and that’s why To Summer is not able to produce products on mass scale and they choose to sell them on Thursday night only.

This appears to be working to the brand’s advantage. In the brands WeChat mini program store, consumers can pay 0.01 RMB to be notified as soon as new inventory is uploaded.

A Deliberate Choice to Stay Slow

Co-founder of the brand Sheng Li (沈黎) believes that customers are very smart to know what a team is like behind a brand. While they have enough demand to grow the brand more quickly, the team wants to stay at this slow pace for now, and in 3-5 years, maybe they will consider expanding their business scale. 

To Summer will open their first offline store in Beijing in December. The store will cover 170 square meters but the team will only allocate 20 square meters for shopping and the rest they want to leave it for customers to drink, read and charge their phones. They want to make it feel like a friend’s house and a space for customers to relax.

Read more: 独家｜拒绝一年增长10亿的快生意，观夏的慢品牌哲学

The post A Slow Marketing Strategy: Fragrance Brand To Summer appeared first on China Marketing Insights.

Money Can’t Always Buy Happiness

You may notice that during Double 11, many brands include the word happiness (幸福感) in their product descriptions, promising that their products will improve life quality and bring the user happiness. 

Media outlet Tencent Entrepreneur (腾讯创业) searched “11.11” and “幸福感” on Xiaohongshu and found that the top 7 products were mainly small home appliances: 

• Washing machine
• Floor mopping robot 
• Projector 
• Intelligent toilet  
• High-speed blender 
• Vacuum 
• HJF (a brand of towel heater)

Although they promise to bring happiness, in fact, many people regret buying them. For example, the towel hanger, people are saying that even before the towel is heated, they gets burnt by the hanger. 

For the floor mopping robot, people are saying that those robots can’t clean well at corners and that they even need to pay more attention when the robot is working, and they also need to worry about the robot leaving home. 

Using the Keyword “Wanghong” Actually Turns People Off

Tencent Entrepreneur also found that using the adjective “wanghong” or internet famous, to describe your products actually turns people off. Only 13% of people feel that they want to buy it more after seeing the word, and the majority of the people (73.1%) said that it makes them not want to buy it. 

Other Reasons Why People Don’t Like Double 11 

• Double 11 usually begins at 0:00, which is not friendly to people who want to go to bed earlier. 
• Consumers need to pay a deposit first and pay the rest a few days later. The period is too long and people start regretting their purchases. With 11.11 broken into two sales periods this year, this actually became an internet buzzword called “尾款人” or people who put down deposits on a lot of items in the presale and then regretted it a week later when they had to pay the rest of the cost. 
• Instead of reducing the price, some brands will give samples as a bonus to consumers, but after receiving them, many consumers discover that the samples are not as good quality as the real products.

Are Reviews Important? Yes and No

Tencent Entrepreneur also found that during this year’s Double 11, 23% of people feel that they need to see other people’s recommendations first before ordering. If no one recommends the product, s/he won’t place the order. 

32% of people say that if they are not sure about a product, they go to see other people’s reviews. 45% of people don’t care what other users say about the product that they want to make their choice independently. 

Read more: 熬夜买买买的尾款人，是到手真香还是顺手交了智商税？

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Escape rooms are one of post-95’s favorite activities

But people don’t just like to watch shows about escape rooms, they like to visit them in real life. According to a report published by Meituan (美团), among post-95s’ favourite entertainment activities, room escape ranks #3. In fact, the amount of people purchasing escape room tickets on Meituan has grown 98.1% year over year.

And these tickets aren’t cheap – one of the most popular rooms in Beijing is 368 RMB ($55) for two hours. 

Using escape rooms to escape reality

People often visit escape rooms in the evening after 7pm. Some want to make it more exciting and choose to play after midnight. Post-90s and 95s love it so much because they are under so much work pressure, and playing the game allows them to escape from reality and show who they really are. They don’t have to put on a serious face anymore, they can shout, scream and cry, and laugh of course. It is called Escape Room, and people are using it to escape from the harsh reality of life. 

Horror-themed escape rooms are the most popular

Since many people are turning to escape rooms to distract them from daily pressures, they often turn to the most exciting theme to play, which is the horror theme.

According to Dazhong Dianping (大众点评), horror-themed escape rooms are among the top 5 escape room themes in most major cities throughout China such as Beijing, Shanghai, Chengdu and Chongqing,

Testing your significant other

People are also joking that this game is good for testing a relationship. An escape room owner says some boys seem quite strong and brave when they enter the room, but in fact, when the zombie shows up, they even run faster than their girlfriends, or they use their girlfriends to cover themselves. Some players find love by playing the game and some are not so lucky, they break up afterwards. 

Read more: 快压垮的职场年轻人，半夜到恐怖密室里找刺激

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