China’s Collectable Toys Market: Pop Mart’s Labubu Phenomenon

China’s collectible toys market, as exemplified by the staggering success of Pop Mart’s Labubu, is a rapidly growing lifestyle and cultural phenomenon driven by young, digitally savvy consumers and strong IPs. Success demands blending emotional branding, digital innovation, and cultural sensitivity while navigating emerging regulatory challenges.

China’s collectible toy market has rapidly transformed into a global powerhouse. With an annual growth rate of around 20 percent and expected to surpass RMB 110 billion (US$15.3  billion) by 2026, this sector is no longer a niche, it’s a cultural phenomenon driven by young consumers seeking emotional connection, surprise, and social engagement. In this wave, one name stands above all: Pop Mart.

At the heart of Pop Mart’s meteoric rise is Labubu, an “ugly‑cute” elf character designed by Hong Kong-Belgian artist Kasing Lung. Since its 2019 debut, Labubu has captivated consumers globally fueling viral fan content, celebrity endorsements from Rihanna, BLACKPINK’s Lisa, Kim Kardashian, and others, and tattooing itself into youth culture through blind‑box retailing on platforms like TikTok and Xiaohongshu.

This craze has translated into serious commercial success. Pop Mart’s valuation recently hit US$40  billion, eclipsing giants like Hasbro and Mattel, with annual sales climbing to approximately US$1.8  billion, about US$1.2  billion of which, was driven by the buzz around The Monsters series featuring Labubu, which saw an over 700 percent annual growth in 2024.

The rise of Labubu offers a lens to explore how Pop Mart has architected a global brand: scaling operations through omnichannel retail, tapping into emotional branding and fan culture, pursuing international expansion, and navigating emerging regulatory headwinds tied to addictive purchasing behavior. It also serves as a privileged case study for understanding the dynamics of China’s fast-evolving collectable toy market.

Pop Mart’s Labubu phenomenon: IP, celebrity, and cultural magnetism

Scale and international reach

Pop Mart’s ascent from a domestic pop-culture disruptor to a global player has been nothing short of strategic. In the first quarter of 2025 alone, the company posted revenue growth of over 165 percent year-on-year, with overseas sales surging by 475 percent. Once heavily dependent on China’s urban collectors, the brand is now reaping the rewards of its ambitious internationalization campaign, with the United States and Europe emerging as major growth engines.

To support this momentum, Pop Mart has aggressively expanded its international footprint. As of mid-2025, the company operates around 200 retail stores and over 2,500 automated “Robo Shops” worldwide. These vending-machine-like outlets, already a staple of the company’s domestic retail strategy, offer a low-cost, high-visibility means to test and penetrate foreign markets while preserving brand novelty.

Pop Mart’s stated goal is to derive 65 percent of its revenue from overseas operations by 2027, a bold target that reflects both the saturation of China’s tier-one cities and the rising global appetite for emotionally driven, collectible-centric consumption. Cities like Los Angeles, London, and Tokyo now host flagship stores, while Pop Mart’s international e-commerce channels continue to see steady user growth.

Part of Pop Mart’s success lies in its ability to localize without losing identity. Rather than merely exporting Chinese IP, the company increasingly collaborates with local artists and licenses popular characters to adapt its offerings to regional preferences. At the same time, its core formula (limited-edition drops, gamified blind boxes, artist collaborations, and online-offline integration) remains consistent.

The international expansion not only diversifies revenue but also helps Pop Mart build cultural cachet as a lifestyle brand, akin to how Supreme or Funko evolved. With its seamless mix of physical retail, vending tech, and digital fan engagement, the brand is exporting more than just toys, it’s exporting a new form of emotional consumerism.

Labubu’s staggering growth

Labubu, the mischievous plush toy from Pop Mart’s “The Monsters” series, has become a global cultural phenomenon, contributing approximately RMB 3 billion (about US$418 million) to Pop Mart’s 2024 revenue—accounting for nearly 23 percent of the company’s total. This marks a staggering 726.6 percent growth year-on-year, underscoring Labubu’s pivotal role in Pop Mart’s explosive success.

Origin story and artistic roots

Labubu was created in 2015 by Hong Kong-born, Netherlands-raised artist Kasing Lung as part of his “The Monsters” series, which draws inspiration from Nordic folklore. The character was initially featured in Lung’s picture books, known for their whimsical and slightly eerie illustrations.

In 2019, Lung partnered with Pop Mart, a Chinese collectible toy company, to bring Labubu to a broader audience. This collaboration transformed Labubu from a niche art piece into a mass-market collectible, blending fine art with commercial appeal.

Celebrity endorsement and social media virality: The start of a phenomenon

Labubu’s rise to stardom was propelled by high-profile endorsements from global celebrities such as BLACKPINK’s Lisa, Rihanna, and Kim Kardashian. In April 2024, Lisa showcased her Labubu keychain on Instagram, igniting a viral trend among her over 100 million followers. This sparked widespread media coverage and a surge in consumer interest.

The toy’s popularity was further amplified by TikTok, where over 1.7 million posts featured Labubu, fueling a global collecting craze. Fans shared unboxing videos, trading tips, and styling ideas, transforming Labubu from a mere collectible into a lifestyle accessory.

Behind Pop Mart’s Labubu success

Cultural significance and emotional appeal

Labubu’s design, featuring oversized eyes, a mischievous grin, and elf-like ears, resonates with consumers seeking both cuteness and edginess. Its appeal lies in its ability to evoke nostalgia while offering a sense of individuality. Labubu has become more than just a toy; it’s a symbol of personal expression and a statement piece in fashion and lifestyle circles.

The character’s backstory and design elements tap into themes of fantasy and escapism, providing emotional comfort to collectors. This emotional connection has been instrumental in Labubu’s widespread popularity, particularly among Gen Z and Millennial consumers.

In summary, Labubu’s success is a testament to the power of strategic IP development, celebrity influence, and cultural resonance. By blending artistry with mass appeal, Labubu has become a cultural icon, reflecting the evolving landscape of consumer behavior and brand storytelling.

Monetization through scarcity and the secondary market

Pop Mart’s business model thrives on one key psychological mechanism: scarcity. By marketing its characters, especially flagship IPs like Labubu, via the blind-box system, the company harnesses the thrill of randomness and the urgency of limited supply. Buyers never know which variant they’ll receive, and rare figures are purposely kept scarce to drive repeat purchases as fans chase full sets.

This scarcity model has paid off spectacularly. A human-sized Labubu figure recently sold at auction in Beijing for RMB 1.08  million (US$150,000). This record sale featured at Yongle International Auction, where a mint-green 131 cm Labubu, claimed to be unique, became the top lot in this auction. Another rare brown Labubu, limited to just 15 pieces worldwide, also sparked fierce bidding and ultimately sold for RMB 820,000 (US$115,000). The total auction revenue for the Labubu-themed event reached RMB 3.73 million (US$520,103).

These headline-breaking transactions do more than generate buzz: they confirm Labubu’s status as a lasting collectible with real-world value. This speculative secondary market creates a reinforcing loop: high auction prices drive consumer interest, which in turn increases demand for primary blind-box releases.

When consumers see collectible toys fetching six-figure sums, they view blind-box purchases as not just fun but potentially lucrative, and culturally prestigious.

In essence, Pop Mart has engineered a self-reinforcing economic cycle:

Limited-supply releases fuel excitement and urgency;
Collector demand drives secondary-market growth; and
Resale premiums validate consumer investment and deepen emotional brand connection.Still, for now, the tactic remains effective and eye-catching. When even human-sized plush toys can command fortunes, Pop Mart’s monetization strategy has demonstrated extraordinary reach, impact, and financial savvy.

Strategic business diversification and retail innovation

Pop Mart has sharpened its commercial edge by transforming its collectible IPs into lifestyle products, enhancing its portfolio and retail model to maximize consumer engagement and margin potential.

Jewelry and “affordable luxury”

In January 2025, Pop Mart launched its first concept jewelry brand, POPOP, with pop-up stores in Shanghai and Shenzhen. It features fashion-forward pieces, such as sterling‑silver, cubic‑zirconia rings and bracelets, branded with marquee IPs like Labubu, Molly, and Skullpanda, priced between RMB 350 to 2,699 (US$50 to 385).

The move positions Pop Mart alongside accessible luxury brands such as Pandora and Swarovski, leveraging beloved characters to enter a higher-margin bracket.

Product mix expansion

The company’s broader product rollout has been spectacular:

Plush toys surged an astonishing 1,289 percent in 2024, contributing approximately RMB 2.83  billion (US$394.60 million) in sales—nearly 22 percent of total revenue;
The MEGA series—featuring oversized premium figures—racked up sales of RMB 1.68 billion (US$234.25 million), increasing by 146 percent year-on-year; and
Meanwhile, derivative lines including apparel, stationery, and accessories also rose 156 percent, totaling RMB 1.59 billion (US$221.70 million).

These moves reflect a strategic pivot: from collectible novelties to diversified lifestyle offerings appealing to varying budgets and consumer behaviors.

Experiential and global retail

Pop Mart’s international retail strategy is anchored by high-visibility flagship locations—such as the Louvre in Paris and Times Square in New York—complemented by regional pop-ups in Shanghai, Chengdu, and Shenzhen. These retail activations are designed to drive both brand exposure and localized consumer engagement.

In China, the launch of its jewelry spin-off, POPOP, extends the brand into the affordable luxury segment. The inaugural store opened at Grand Gateway 66 in Shanghai, offering Labubu-themed charms priced between RMB 350 (US$48.80) and RMB 2,699 (US$ 376.34), and the Beijing flagship has also been inaugurated in May 2025.

Pop Mart’s physical footprint is reinforced by a digital membership ecosystem of over 46 million registered users, who account for approximately 90 percent of total sales. This hybrid retail approach—merging destination storefronts with platform-based loyalty—has become a core pillar of the company’s monetization and customer retention strategy.

Consumer dynamics: Fatigue, polarization and teen scrutiny

While Pop Mart continues to ride a wave of consumer enthusiasm, especially with its Labubu IP, recent trends point to a more complex consumer landscape. A growing portion of users—approximately 43 percent—report intentions to reduce blind-box purchases due to issues such as design fatigue, price sensitivity, and a perceived saturation of product offerings. These sentiments are particularly prevalent among longtime collectors, some of whom express disillusionment with what they see as overly commercialized or repetitive character releases. This emerging fatigue could indicate that Pop Mart’s reliance on blind-box mechanics may face diminishing returns unless IP development and product variation are substantially diversified.

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At the same time, a nearly equal segment—around 41 percent—has signaled plans to increase their purchases, particularly among newer consumers just entering the pop-toy ecosystemThis indicates a polarized market, where veteran skepticism is being offset by the enthusiasm of fresh demographics drawn in by celebrity exposure, social media virality, and the perceived prestige of ownership. The momentum generated by newer consumers—often younger and more digitally native—helps sustain Pop Mart’s growth trajectory, at least in the short term.

However, this generational turnover also introduces new scrutiny. In June 2025, a commentary published by People’s Daily called for tighter regulation of blind-box toys and trading card models, citing legal experts who flagged their addictive potential, particularly among minors. Although Pop Mart was not named directly, the market response was immediate: the company’s shares fell by as much as 6.6 percent following the article’s publication, after a 5.3 percent drop the previous day. Analysts linked this market reaction to fears of a looming regulatory clampdown on core aspects of Pop Mart’s business model, particularly its opaque pricing and randomized purchase mechanics.

China already prohibits the sale of blind boxes to children under the age of eight, and further tightening may be on the horizon as authorities attempt to balance the promotion of Chinese IP success stories with the protection of vulnerable consumers. While policymakers have generally supported China’s IP-intensive cultural industries, including Pop Mart’s global expansion efforts, they have also demonstrated a growing willingness to intervene when commercial practices are seen as predatory or psychologically manipulative.

The company now faces a delicate balancing act: sustaining consumer excitement through novelty and emotional engagement, while also demonstrating corporate responsibility and compliance amid rising political and regulatory expectations. This tension may become a defining factor in how Pop Mart evolves from a pop-culture phenomenon into a lasting global brand.

Key takeaways for foreign businesses and investors from China’s evolving collectable toys market

China’s collectible toys market has transformed significantly in recent years, evolving from a niche pastime into a dynamic lifestyle industry deeply rooted in emotional engagement and aesthetic sensibilities.

At the heart of this shift is a new generation of young, urban consumers, predominantly Gen Z women, who approach collecting not simply as a solitary hobby but as a form of social participation and identity expression. For these consumers, collecting extends beyond the physical acquisition of products; it is intertwined with community-building, fandom culture, and a desire to connect with broader cultural narratives.

Brands that successfully tap into this trend do so by leveraging strong IPs, especially those that resonate with Chinese cultural motifs or feature collaborations with popular artists. These IPs enable companies to command premium pricing, even when the underlying production costs remain relatively low. This premiumization underscores the market’s increasing sophistication, where consumers are willing to pay for the intangible value of design, storytelling, and brand prestige.

The blind-box format remains a central mechanism for stimulating purchases, capitalizing on the psychology of surprise, scarcity, and the collector’s instinct to complete sets. However, as previously discussed, signs of buyer fatigue are emerging. Consumers (especially veteran collectors) are growing wary of repetitive designs and escalating prices, raising questions about the long-term sustainability of this model without continuous innovation. To navigate this trend, investors should prioritize brands that actively invest in creative design pipelines, diversify product lines, and explore hybrid formats that retain novelty while offering greater perceived value to consumers.

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At the same time, the market is witnessing growing digital integration and gamification strategies. These innovations create new avenues for consumer engagement, such as virtual collectibles, app-based loyalty programs, and interactive shopping experiences, which collectively deepen the emotional connection between brands and their audiences. For foreign businesses and investors, these developments highlight an opportunity to move beyond traditional retail models and explore hybrid digital-physical strategies tailored to China’s digitally savvy consumer base.

In sum, China’s collectible toys market is no longer just about toys. It represents a broader cultural phenomenon that blends lifestyle, technology, and emotional branding. Success in this market requires a nuanced understanding of evolving consumer behaviors, regulatory considerations, and the creative deployment of IP and digital tools. Foreign companies seeking to enter or expand in this space will need to combine cultural sensitivity with innovation to navigate this complex but promising landscape.