Labubu Economics: Big Business Opportunities Behind Small Product Categories

Author | Tang Fei

Editor | Tan Ge

Outside a shopping mall in London at 4 a.m., 2,000 people set up tents and queued; in the incense - filled Bangkok Buddhist temple, Thai monks chanted scriptures to consecrate Labubu; in Tokyo's Ginza, due to the large number of people rushing to buy Labubu, emergency crowd - control measures were activated; in front of South Korea's Pop Mart stores, consumers queued overnight, and there were even situations of quarrels and physical altercations, which attracted the police...

Labubu's popularity has extended from offline to online. According to data from Shoplus, the sales of blind boxes of Labubu's parent company, Pop Mart, on Thailand's TikTok soared in the past three days, with a month - on - month increase of more than 357%, ranking second on the sales surge list. The sales volume of this blind box reached nearly 3,000 pieces in the past three days, and the sales revenue exceeded $75,000. On the TikTok Shop US site, Pop Mart is expected to achieve sales of $6 million to $7 million in April, with a month - on - month increase of 18 places, leaping to the top of the growth rate list. During the 618 promotion period, Labubu even soared to the top of the overseas search list on AliExpress.

These phenomena are not isolated cases but a microcosm of the global craze for Labubu.

Pop Mart's 2024 financial report shows that its overseas revenue soared by 216%, and Labubu contributed more than 35% of the global sales volume.

What was once an unremarkable plastic doll is now known as the "plastic Moutai" and the "new currency".

01 When the "Monster" Rules the World

Labubu was created by Long Jiasheng, a designer from Hong Kong, China. Its prototype is an elf from the Nordic forest. With pointed ears, round eyes, nine jagged teeth, and a "sneaky" smile... Its design, which breaks traditional aesthetics, allows Labubu to retain the cuteness of a plush toy while also having a mischievous and rebellious personality.

In April this year, the Labubu 3.0 series was launched globally, triggering a craze where "one Labubu is hard to find" everywhere. The New York Times commented: "This is the stamp - collecting craze of the 21st century, but even crazier."

Moreover, the secondary - market trading of Labubu is booming. The premium of some popular models is as high as dozens of times, and it has also spawned peripheral businesses such as leasing and decoration. At the just - concluded Yongle 2025 Spring Auction, a 131 - cm - tall mint - colored Labubu was sold at a high price of 1.08 million yuan, setting a new record for the auction of trendy toy single items.

Image source: Weibo @Pop Mart

Driven by products like Labubu, Pop Mart's overseas revenue in the first quarter skyrocketed by 480% year - on - year. The growth rate in the American market soared to 895% - 900%, and the European market also achieved an astonishing increase of 600% - 605%.

In 2025, to support the huge overseas purchasing enthusiasm, Pop Mart launched its largest organizational adjustment in five years: four regional headquarters (Greater China, the Americas, Asia - Pacific, and Europe) were established and were fully empowered with independent decision - making power. "These regional headquarters are not just executive agencies; they can formulate more targeted market strategies," explained the person in charge of Pop Mart's international business.

Currently, all overseas general managers of Pop Mart are foreigners, and more than 90% are talents of the nationality of the host country. As of the end of 2024, there were more than 1,000 overseas employees, and more than 95% were foreigners.

Labubu's global influence is inseparable from the promotion of user - generated content (UGC). Users have further expanded the spread of Labubu by creating second - creation emojis. Data shows that the playback volume of Labubu's second - creation emojis has exceeded 1 billion times. In addition, users have spontaneously organized "doll - swapping parties", and such activities have covered 50 countries around the world.

The financial report shows that as of the end of 2024, the number of Pop Mart members reached 46.083 million, a year - on - year increase of 34.1%. The revenue contribution rate of members was as high as 92.7%, and the repurchase rate remained at a relatively high level of around 50%.

In addition to the promotion of UGC, Labubu's success also benefits from the boost of platform algorithms. TikTok strongly binds the "blind - box unboxing" label with Labubu, and 30% of the traffic of relevant videos is tilted. This algorithm boost has significantly increased Labubu's exposure on social media and further expanded its influence.

As Labubu's popularity gradually increases, the popularity of its related peripheral products has also risen accordingly.

In recent weeks, the search popularity of keywords related to "Labubu" on the Amazon US site has soared. The word "Labubu" has entered the top ten of the search list this week, driving a sharp increase in the popularity of multiple categories such as doll clothing, doll accessories, and stickers. As of the time of writing, there are already more than 2,000 Labubu peripheral products on Amazon.

Among them, the most popular category is Labubu - related clothing sets. On Amazon's "Doll Clothing & Accessories Sets" new - product best - seller list, the top five best - selling products are all clothing products that match Labubu's size (or directly use Labubu as the "model" in the product pictures). The "work uniform" at the top of the list sold more than a thousand pieces last month.

Image source: Amazon

On other cross - border e - commerce platforms, such products are also very popular. On Temu, some Labubu clothing items have sold thousands of orders, and other related peripherals such as Labubu transparent protective cases and storage boxes have also sold hundreds of orders.

JPMorgan Chase, in its latest research report, regards Labubu as the "next Hello Kitty". The bank's analysts believe that Labubu and Hello Kitty are very similar in character style and business model and are rapidly emerging as a new generation of super IPs.

02 No Need to Discuss the "Tulip"

As Labubu becomes extremely popular, market opinions are polarized.

Some people start to discuss the paths and methods for the successful overseas expansion of "Chinese IPs", while others begin to worry that Labubu is the next "tulip bubble".

In fact, Labubu's success is a precise grasp of consumer psychology. The "Report on Z - Generation Trendy Toys" shows that 72% of consumers believe that "Labubu represents my rebellious personality". This emotional resonance makes consumers project their pursuit of rebellion and individuality onto Labubu.

In consumer psychology, identity identification is an important psychological phenomenon. Consumers express their identity and values by purchasing and using certain products. Through its unique design and brand positioning, Labubu has successfully attracted young consumers who pursue individuality and rebellion, making them project their self - identity onto Labubu.

For example, the design of Labubu's keychains exactly hits their social needs - hanging it on a bag instantly becomes a "circle identity certification". The statement "Hermès has become a side - item for Labubu" is not only popular on the hot - search list but also a real consumption scenario.

At a recent Hermès fashion show, what was most discussed at the scene was not Hermès bags but Labubu. Since a fashion show not only launches new products but is also an important social scenario for invited guests, the Labubu keychains on many guests' handbags have become social capital and a signal of "understanding fashion and trends".

This model breaks through the traditional pattern of brands unilaterally defining trends and shifts to a more interactive and two - way value - output model. Content and narratives are jointly created by the public, and the concept of "uselessness with usefulness" is highlighted.

Image source: Weibo @Pop Mart

As Wang Ning, the founder of Pop Mart, said, all consumption behaviors aim to solve two things: one is satisfaction, and the other is a sense of existence. It is actually not easy to really make people spend money on a pure product without practical functions. Some luxury brands like to cooperate with artists because "useless" things are truly eternal. As long as a product has functional attributes, it means a short life cycle and inherent decay.

Recently, he even made a rather bold statement. He said that if Molly's head could be removed to be a USB flash drive, everyone would definitely only buy one. Because people would default to thinking from a functional perspective: since they already have one, there is no need to buy so many USB flash drives, and consumption would stagnate. But precisely because Molly and Labubu are useless and only bring people happiness, people keep buying them one after another.

This analogy was later refined by netizens into a more concise expression, such as "You only need to buy one USB flash drive, but you can collect a bunch of toys", to emphasize the essential difference between functional items and items with emotional value. As Wang Ning said, the "uselessness with usefulness" is the eternal value - just like the artworks in museums never change but carry the emotional resonance of humanity across thousands of years.

Wang Yandong of BMI Xingyuan Consulting believes that the essence of the "uselessness with usefulness" in business is to transform products from "functional tools" into "emotional media", and use irreplaceable emotional experiences and social identification to build consumption necessities that transcend "practical logic".

This value proposition is "eternal" because it targets human emotional needs - even a small sense of collectiveness, or emotions such as showing off and comparing.

03 There Is Big Business in Every Niche Category

Looking further, Labubu's success is not only the success of a trendy toy IP but also a successful case of the overseas expansion of niche demands.

Liang Ning put forward many profound insights about business and demands in her book "Real Demands". The most widely circulated one is the analysis of the business closed - loop. She pointed out that "the business closed - loop is to identify demands, provide value; reach a consensus with customers/markets, achieve transactions and relationships, and thus obtain money and resources; then develop oneself, invest in one's own competitiveness, and make oneself more competitive for survival."

"Identifying demands and providing value" is the foundation of business. The psychological needs brought by Labubu are a kind of demand, and the practical needs in the physical sense are also a kind of demand. We need mechanization to liberate our hands and automation to improve efficiency. "Laziness" is the driving force for human progress.

Take the common courtyard economy in Europe and the United States as an example. Europe, the United States, Australia, etc. occupy the world's major private lawn and garden markets. According to the prospectus of Daye Co., Ltd., the number of gardening enthusiasts in the United States, Germany, and the United Kingdom respectively exceeds 40%, 60%, and 49% of the total adult population of their countries. Lawn - care work generally starts after the snow melts in March (in winter, the main work is snow - blowing and snow - sweeping). During the peak grass - growing season in summer and the rainy season, the lawn is usually mowed twice a week or three times every two weeks. In the off - season such as autumn, the mowing frequency is generally once a week or twice every three weeks. In other words, the period of continuous maintenance and repair throughout the year exceeds eight months.

In the first quarter of 2025, the export value of Chinese intelligent lawn mowers reached $1.01 billion, a sharp increase of $375 million compared with the same period last year, a year - on - year increase of 58.92%.

Companies that have seized the opportunity of "lawn repair" have also reaped rich rewards. The lawn - mowing robot products of Ninebot have been sold to more than 30 countries and regions such as Germany, France, the United States, the United Kingdom, and New Zealand, and its revenue last year was 861 million yuan. The overseas revenue and sales volume of Ecovacs' lawn - mowing robots increased by 186.7% and 271.7% respectively year - on - year in 2024. To cope with the increasing orders, Daye Co., Ltd. completed the acquisition of the German AL - KO company at the beginning of this year and added a production base in Austria.

Image source: IDC

Related to the courtyard is also the security field. Chinese brands have unique advantages in the global consumer camera market. In the first quarter of 2025, Ezviz ranked first in the world with a shipment volume of 4.203 million units. Ezviz Network's financial report shows that in the first quarter, the company's revenue was 1.38 billion yuan, a year - on - year increase of 11.6%; the net profit attributable to the parent company was 138 million yuan, a year - on - year increase of 10.2%.

Similarly, Xiangjiang Electric Appliance, which started from OEM, has made a big business with small kettles. According to the Frost & Sullivan report, calculated by the export volume from China to the United States and Canada in 2023, Xiangjiang Electric Appliance's electric kettles accounted for about 21.4% and 32.3% of the market share in the relevant categories defined by the General Administration of Customs of China respectively. It's no exaggeration to say that one out of every five kettles you see in North America is from Xiangjiang Electric Appliance.

In addition to the above - mentioned common demands arising from "laziness", there are also some consumption sectors arising from consumers' personal needs. Although these demands are niche, their explosive power is astonishing.

In the US market of TikTok, a simple shoe rack made in China, with a discounted price of $9.88, sold more than 12,000 units in the past seven days (June 18 - 24). On June 20, the daily sales volume reached a maximum of 4,576 orders, and it topped the category list in the US market. Also in the US market, a 2 - in - 1 watermelon fork slicer sold 23,500 units in the past 28 days, with a total sales revenue of $244,900, ranking third on the category sales list in the US market, and its product popularity index is still rising. This 2 - in - 1 watermelon fork slicer originated from Yiwu, China. The same product became popular on Amazon last year and has caused a stir on TikTok this year. In the Thai list, the MYONLY eyebrow pencil from China performs particularly well. With its practical and convenient rotating design and cost - effective strategy, it firmly ranks among the top three on the list and has become a "must - have item" in local consumers' daily makeup.

Image source: FastMoss

The saying "Six out of every ten wigs in the world come from Xuchang" is well - known in the industry, directly indicating the global influence of Xuchang wigs. "Xuchang wigs" have been among the top three on the global AliExpress overseas hot - sales list all year round. The local area is the world's largest hair product distribution and export base. As the first domestic hair - product listed company, Rebecca has been included in the list of China's 500 Most Valuable Brands for two consecutive years. In the first quarter of this year, Rebecca's revenue was about 305 million yuan, a year - on - year increase of 11.26%; the net profit attributable to shareholders of the listed company was about 6.3606 million yuan, a year - on - year increase of 18.59%.

Similarly, for the "business on the head", the straight - hair comb brand TYMO developed and produced a straight - hair comb that can heat up to 200 degrees in 30 seconds to address the unique hair - quality problems of people of color. With high - density comb teeth, it can complete the straightening action directly during the combing process. On the Amazon platform, the average monthly sales revenue of TYMO's straight - hair comb has been maintained at about $800,000 in the past three months, and the monthly peak once exceeded $3 million.

Coincidentally, Leshushi, which mainly deals in baby diapers, baby pull - up pants, and female hygiene products, ranked first in both the baby diaper and sanitary - napkin markets in Africa in 2023, with market shares of 20% and 14% respectively. The prospectus shows that the revenue of just one of its sub - brands, Leshushi, reached $334 million from January to September 2024, with a gross profit margin of more than 35.4%.

The success of these brands has proven the huge potential of the overseas expansion of niche fields. As Peter Thiel said in "Zero to One": "Competition is for losers. Real winners find their unique value in niche fields." These brands have successfully achieved global expansion by finding their unique value in niche fields, providing consumers with more choices and valuable references for other brands.

In the future, as the globalization process accelerates and consumer demands become more diverse, opportunities for the overseas expansion of niche sectors will continue to emerge. Brands need to continuously explore and innovate, and dig out big business in small categories. The story of Labubu is just the beginning.

This article is from the WeChat official account "Xiaguang She". Author: Tang Fei. Republished with permission.