It has returned to the starting point for half a year after being listed. This is the case with Bubble Mart, which was once regarded as a myth in the secondary market.
On December 11, 2020, the “Blind Box First Share” Bubble Mart was listed on the Hong Kong Stock Exchange with an issue price of 38.5 Hong Kong dollars per share, and the closing price of the day was 69 Hong Kong dollars per share, an increase of 79.2%. After that, its stock price once rose to 107.6 Hong Kong dollars per share, and there was a voice comparing Bubble Mart to “the fashionable Maotai”.
However, as of August 10, 2021, Bubble Mart’s share price has fallen to 56.4 Hong Kong dollars per share, down nearly 40% from the highest point of 107.6 Hong Kong dollars per share, and its market value is about 75.494 billion Hong Kong dollars, which is more than 700 dollars from the high point. Billion Hong Kong dollars.
Why is Bubble Mart not fragrant anymore?
Molly and Bubble Mart advance and retreat together
Bubble Mart has suffered long-term losses. From 2014 to 2016 from January to May, the net profit of Bubble Mart was -2.7729 million yuan, -15,980,400 yuan, and -24,835,300 yuan.
In 2015, Wang Ning, CEO of Bubble Mart, discovered that a Japanese IP toy Sonny Angel in his store was very popular and began to switch to IP operations.
Molly is the pride of Bubble Mart.
After 4 months of negotiations, Bubble Mart got the exclusive authorization from Molly. The blind box of the Molly series was sold out one second after it was launched on the Tmall flagship store in June 2016. After that, the loss of Bubble Mart began to improve. It was through Molly that Bubble Mart reversed the trend.
When co-branding with Bubble Mart, the partner that chooses the most is “Molly” IP. For example, Dove and Bubble Mart jointly launched two small refreshing limited Molly and three Molly “side face kill” chocolate; Fanta and Bubble Mart launched “Fanta × Molly: Molly lives in Fanta House “Activities; In terms of film and television, Sons of Tomorrow will launch a limited version of Molly for the program, and “National Treasure” will cooperate with Li Bai’s Molly.
Molly brought Bubble Mart’s supreme glory, and at the same time made it fall into the predicament of relying too much on Molly.
In 2017, “Molly” IP accounted for 89.4% of Bubble Mart’s revenue. Bubble Mart also stated in the prospectus that if Molly is damaged or fails to maintain its current appeal to consumers, it will face the dilemma of no substitutes.
However, a practical problem that cannot be ignored is that after a few years of fire, the popularity of “Molly” IP is gradually cooling down. From 2018 to 2020, the revenue share of “Molly” IP has declined year by year, to 62.9%, 32.9%, and 14.2% respectively.
This shows that Bubble Mart’s anxiety about finding the next Molly is self-evident.
In response to this, Bubble Mart established an internal designer team PDC (Pop Design Center), launched a series of IP such as Sweet Beans, and jointly signed a designer to launch a series of IPs such as SKULLPANDA. At the same time, Bubble Mart has also cooperated with well-known IPs to launch product series such as Harry Potter and Naruto. However, no matter how hard they work, the IP that users first think of when they mention Bubble Mart is still Molly.
Negative news keeps falling into plagiarism scandals
Happiness and pain are mixed.
The blind box economy once made Bubble Mart soar. Now, the blind box economy started by Bubble Mart has been criticized and questioned by the China Consumers Association.
In January 2021, the China Consumers Association wrote an article “China Consumers Association Consumer Tips: Operators should regulate the sale of blind boxes, and consumers should not blindly buy blind boxes”, indicating that the blind box market has the following problems:
Merchants are over-marketing, and consumers tend to be “addicted”;
The merchant is suspected of false propaganda, and the goods on hand do not match the propaganda;
Product quality is difficult to guarantee, and fake and inferior, “three noes” products appear from time to time;
Consumer disputes are difficult to resolve, and after-sales service needs to be improved urgently.
The article pointed out that some merchants have created the concept of “series” and set up a “hidden item” that is the most difficult to obtain for hunger marketing. The probability of winning is mostly “one in a hundred”. This kind of marketing method makes many consumers indulge in enjoying the uncertainty and surprise brought by blind box opening, triggering consumers’ impulse purchase, and encouraging irrational consumption behavior. Young people are very curious, like to compare, and have unsound consumption concepts. They are very easy to become addicted to the blind box, and some even directly “end the box” in order to win the “hidden money”.
Bubble Mart is a typical case.
For example, on the Xianyu second-hand platform, Bubble Mart’s 59 yuan hidden polar bear of Dimoo has been fetched to 2,800 yuan, a price increase of nearly 48 times, and its Molly hidden captain has also fetched to 1988 yuan. Some users said that it is a great value to exchange a hidden item for a few thousand dollars. When buying a hidden item in Taobao flagship store, the probability of getting a hidden item is 1/144, which is shocking when multiplied by the unit price.
At the same time, Bubble Mart has repeatedly reported negative news.
At the end of 2020, users broke the news that a blind box product was split for secondary sales in a Pao Mart store in a shopping mall in eastern Jinan. The user contacted the store manager for verification, and was acknowledged by the store manager, who fired 5 employees after investigation.
The fact that “the blind box you bought may have been opened by others” makes many customers abandon the “pit”.
A user said, “The store manager of Bubble Mart will keep the hot money privately. I went to buy the whole box. A new store clerk told me that it had it and took it out. Then the store manager came and said no. This’honey operation’ (Operation of mystery) I’m out of the pit, and I don’t like things that are manipulated by people in the dark.”
Another user described, “I bought a unicorn and a three-and-a-half co-branded bob before. There is also a box outside the blind box. The outer box is complete. The blind box inside was opened and seen. I will never buy it again. Blind box. I also bought a lot of Bubble Mart, the whole box of lucky bags, except for thunder or thunder.
Bubble Mart also reported plagiarism before.
On February 8, 2020, Bubble Mart launched AYLA rabbit series products, and consumers complained about plagiarism of DollChateau products. The AYLA rabbit series products are similar to DollChateau in color, clothing pattern, and hairstyle. It is reported that this is a work also announced by the designer of Bubble Mart. After the work was launched, netizens found that the work had a high similarity with a number of characters in DollChateau doll, Netease Fifth Personality, and Onmyoji game.
In response, DollChateau posted on Weibo that it has announced that DollChateau (“baby castle” in Chinese) has jointly launched a blind box with Bubble Mart: There is no such thing. After that, Bubble Mart refused to admit the plagiarism, but customers asked for refunds.
The blind box market is a red sea
When Bubble Mart first introduced the concept of blind boxes, the field was still a blue ocean. However, in the past few years, the field of blind boxes has become a red ocean.
At present, apart from Bubble Mart, other grocery stores such as Kule Chaowan, Sundries Club, MINISO are also launching their own blind boxes, such as TOKIDOKI, Ari, Changcao Kaomoji, little amber, Wuhuang Mansui, Toy brands such as Luo Xiaohei, My Little Pony/Little Pony, LINE FRIENDS have also launched blind box products, and catering companies such as Xiabuxiabu and Ruixing Coffee have also begun to launch blind box series toys.
A few days ago, “the second in the industry” 52TOYS CEO Chen Wei called Bubble Mart “the first stock of fashion play” in an interview, and 52TOYS will be the “first brand of collectible toys”. At the same time, Chen Wei expressed that he strives to be on the market within 1-2 years, and the scope of collectible toys is larger than that of tide play. Only product diversification can support the scale of this 100 billion market.
However, with competitors entering the blind box one after another, Bubble Mart is increasing product prices to maintain a high gross profit margin. In April 2021, Bubble Mart increased the unit price of the blind box from 59 yuan to 69 yuan, which went against the trend of sinking in the blind box market.
With the “Molly” IP gradually cooling, negative news exposed, and the industry’s blue ocean no longer, whether the “Blind Box First Share” Bubble Mart can regain the recognition of the capital market remains to be verified.
(This article is for reference only, does not constitute investment advice, and operates at your own risk accordingly)
Article source: GPLP Rhino Finance (ID: gplpcn), author: Jinshanghua, 36Kr authorized release.
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