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Original title: Bubble Mart’s market value is approaching HK $ 100 billion, but the main competition is not a “blind box.”
Our reporter Xie Ruolin
On December 11, 2020, Bubble Mart was officially listed on the main directory of the Hong Kong Stock Exchange. On the first day of trading, Bubble Mart’s share price opened sharply higher, with a market value of more than 100% at the open, and its market value exceeded 100 billion yuan. It finally closed at 69 Hong Kong dollars per share, an increase of 79.22%, and its market value was 95,329 million Hong Kong dollars.
Wang Ning, Founder and CEO of Bubble Mart, said at the listing ceremony: “We have created a category and an industry, and created an ecosystem of fashion toys, so that a generation of young people can understand what toys are from. fashion. The times have left a cultural mark on fashionable toys. “
According to the Frost & Sullivan report, fashion toys refer to toys that intelligently integrate the culture and content of trends. Based on the revenue growth rate from 2017 to 2019, Bubble Mart is already the largest and fastest growing fashion toy company in China. Among them, according to retail sales in 2019, Bubble Mart has 8.5% of the Chinese fashion toy market.
“The blind boxes appeared a long time ago. This is just a marketing method. The essence is that this type of game satisfies people’s pursuit of beauty and pleasure, followed by a kind of expression of personality, emotional support and collection. Hope “. Bao Fan, Chairman of Huaxing Capital, founding partner and chief investment officer of the fund, said that the core of Bubble Mart’s success is definitely not the blind box, but the design, the supply chain and finally the retail terminal to form a platform . Capacity. “
The rise of the tidal game economy
In 2010, Bubble Mart was established in Beijing. When Wang Ning first founded the company, he pointed to the Hong Kong company’s “LOG-ON” sales model and positioned it as a “trend lifestyle small department store”. In 2015, the company began trying to launch self-managed fashion toys. The following year, he obtained the copyright clearance from Molly and introduced the blind box game. In June of that year, it launched the fashion toy community app “Paqu”, beginning the transformation into an IP incubator operator.
As of 2017, Bubble Mart has continued to derive from the fashion game upstream industry chain. Through his own IP creation and cooperation with artists and IP providers, he has been extracting a great deal of IP resources. At the same time, the company is also expanding online and offline sales channels, holding large-scale international fashion toy exhibitions and improving its sales network. Looking back at the development of the past 10 years, Bubble Mart has continued to explore and understand the growth path from a channel merchant to a full Chaowan industry chain platform.
According to the Bubble Mart Prospectus, in the first half of 2020, the company’s total revenue was 818 million yuan, a year-on-year increase of 50.5%; net profit was 141 million yuan, a year-on-year increase of 24.7%. As of June 30, 2020, Bubble Mart operates 93 IPs, including 12 proprietary IPs, 25 exclusive IPs, and 56 non-exclusive IPs, and has 3.6 million registered members.
On the other hand, under the new consumer demand for consumption improvements and generational changes, the fashion game market is booming, and fashion blind boxes and toys have become a fashionable emerging market. According to relevant data, the scale of China’s fashion toy market has continued to expand, from 6.3 billion yuan in 2015 to 20.7 billion yuan in 2019, and is expected to reach 26.2 billion yuan this year.
How to set the tidal game industry moat?
An industry analyst believes that Bubble Mart’s main competitiveness lies primarily in its strong operating intellectual property assets. As of June 30, 2020, Bubble Mart operates a total of 93 IPs, including 12 proprietary IPs, 25 exclusive IPs, and 56 non-exclusive IPs. Behind these IPs are Bubble Mart’s diverse and rich designer resources to back you up. As the first entrants in the industry, artists and designers have the first opportunity, which is conducive to the effective incubation and production of their IP.
“Second, with its familiarity with the sub-industry, Bubble Mart not only occupies the first resource advantage in intellectual property commercialization and explosive modeling, but also has insight into industry trends. After As Molly became popular, Pucky, Dimoo and other series are also increasing strongly. Under their refined operation, they have continuously strengthened consumer adherence. The overall buy-back rate of Bubble Mart registered members in 2019 is 58%, which is higher than that of the Chinese trend toy retail. The average overall buyback rate of the top ten players in the market (50.4%), “said the analyst.
At present, Bubble Mart has become an integrated platform covering the entire chain of the fashion toy industry. As of June 30, 2020, Bubble Mart’s sales and distribution network mainly includes: 136 retail stores in main business districts in 33 first- and second-tier cities in China; 1,001 innovative robot stores in 62 cities; Besides, there are online channels such as Tmall flagship store, bubble box pumping machine, Paqu app, fashion shows and wholesale channels.
In addition, Bubble Mart has started to establish overseas sales channels and plans to further expand its business to the Asian, European and North American markets. Currently, Bubble Mart has established distribution networks in 21 countries and regions.
In the venture capital circle, Bubble Mart has always been the “sweet pastry” in the eyes of capital. Before the IPO, Bubble Mart’s main institutional investors include Sequoia Capital China Fund, Black Ant Capital, Zhengxin Valley Innovation Capital, Huaxing Capital, Fengqiao Capital, etc.
Among them, Huaxing Capital entered during the Bubble Mart Pre-IPO, when Bubble Mart had reached a valuation of US $ 2.5 billion. In 2019, when Bao Fan met Wang Ning for the first time, he asked three questions: “Why do you want to do this? What kind of company does Bubble Mart want to become in the future? Why do you think you can do it yourself? “
“Wang Ning is a very clear-thinking person and he doesn’t speak much, but you can feel a sense of tenacity in this person.” Bao Fan said: “It took us only 20 days from decision making to investment in this transaction. The style is like this, as long as you get a good look at it, you will shoot immediately.”
The target is the “Bubble Mart of China”
“Only by doing long-term business can we produce a snowball-like scale effect.” Bao Fan believes: “We agree that Chaowan is just the beginning of Bubble Mart, and the future (the company) can also achieve a lot of business: No. First, continue to attract more people by expanding intellectual property, sinking the market and foreign markets; second, it can cross borders, make movies, theme parks, etc. to meet the more spiritual needs of consumers. These are also stories that can be told. In the future, Bubble Mart can become a great platform for IP-based entertainment “.
In fact, Bubble Mart is not “short of money.” “Bubble Mart is not like an Internet company that needs to spend money. The cash flow of the company is very good. Actually, there are not many reasons for such a company to accept institutional money. The return to the Bubble Mart project is more between institutions In competition, everyone’s money is money. The difference, in addition to money, is what resources the organization can provide to the company, “said Bao Fan.
Some people in the industry believed that Bubble Mart is the closest company to Disney in China.
In an interview with reporters, Bao Fan said that being close to Disney does not mean copying Disney completely. What they all make is an integrated, IP-based entertainment platform, but it’s hard to compare the two companies one by one. The IP is different and the crowd is different. The times are different, but the general direction (integrated entertainment platform) is definitely the direction you want to work hard.
Wang Ning believes that, compared to being “Disney of China”, Bubble Mart aims to be more “Bubble Mart of China”. Moving forward, Bubble Mart will incubate and operate commercial intellectual property in its own way. The company recently invested film “Nezha Rebirth” will be released in early 2021, and Popmart’s land project will also be set in Beijing.
