<h2>Summary:</h2>
&#34;In the year we went public, regardless of whether they are large enterprises or small businesses, a massive number of peers wanted to rush in and do the same thing. You will find that, whether at the time of our IPO or five years later, we are still continuously widening the gap with companies doing similar things, and it is even getting larger.&#34; Wang Ning said, &#34;Our scale is already very large, the growth rate is still fast, and our overall market share is also further increasing.&#34;
<h2>What is the core barrier of POP MART?</h2>
In March, the temperature in Beijing reached 20 degrees, and the POP MART City Park in the southwest corner of Chaoyang Park welcomed its peak season. On the afternoon of March 26, Phoenix Technology met with POP MART CEO Wang Ning, COO Si De, and President of International Business Wen De in the park's office. This is the first time the core management team of POP MART has publicly faced the media since its market value returned to 100 billion.
POP MART was the most astonishing story in the secondary market last year, with its stock price soaring 340% within the year. This has intensified external curiosity about POP MART.
Discussions in the investment industry have shifted from &#34;collectively missing out on POP MART&#34; to &#34;how to replicate the second POP MART.&#34;
&#34;POP MART has never had secrets,&#34; Wang Ning told Phoenix Technology, &#34;We are a consumer-facing company, and we opened stores from day one. However, everyone became familiar with us in 2020 when we went public, (at that time) we received good market recognition. Throughout our journey, what we sell, how we sell, and what is popular has always been open and transparent.&#34;
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POP MART initially gained popularity through blind boxes, which is a well-known secret in the market, but is blind box the commercial core of POP MART? Wang Ning has long stated that it is not; he categorizes blind boxes as &#34;technique,&#34; similar to how supermarkets use discounts as a technique, but merely relying on such techniques is not enough for a company to achieve lasting success. After 15 years of establishment and 5 years since going public, they have found a second growth curve.
In the past five years, POP MART's revenue has increased fivefold, from 2.5 billion to 13 billion, with the best-performing revenue coming from plush toys, the high-end MEGA line, derivatives, and others. The proportion of the original figurine category has dropped to 53.2%, but it remains a rapidly growing core category. Wang Ning has compared POP MART to a record company, just as the copyright of songs belongs to the record company, the permanent copyright of current IP also belongs to POP MART, &#34;The core is to continuously discover good artists and maximize their commercial value.&#34;
Some snowballs are starting to roll. In 2024, POP MART will have 4 IPs with revenue exceeding 1 billion and 13 IPs with revenue exceeding 100 million. The revenue from mainland China’s business has also increased by 52.3% year-on-year.
In the past year, they also discovered &#34;soft rubber plush,&#34; a new explosive product of the year, completing the construction of the plush category supply chain within the company. In addition, the steadfast POP MART has seen a turnover of top IPs replaced by LABUBU—a forest elf with big eyes and sharp teeth, which at first glance looks a bit like a rabbit.
According to the financial report, the revenue of the monster series where LABUBU is located reached 3.04 billion yuan in 2024, a year-on-year increase of 726.6%, making it the largest IP of POP MART. Its vinyl plush products are always sold out in POP MART stores.
Si De told us that this is a sweet trouble, &#34;Last year, market demand was too great. When the order volume was too large, I was shown the orders, and I didn't even dare to sign them myself, far exceeding our own expectations.&#34; To solve this problem, POP MART has been optimizing the efficiency of the entire process from product design to production internally. He expects the entire process will go through a painful period of six months to a year, after which it will become smoother.
Even though scarcity in the market may not seem like a bad thing, POP MART's management believes that good products are not financial products, but items that everyone can buy.
No one can simply summarize POP MART; it is primarily a retail brand but also has a strong IP gene. What can be seen externally is that POP MART is continuously trying new businesses on the commercial level, expanding its boundaries from urban amusement parks, building blocks to derivatives.
Many people may ask, what exactly is POP MART's moat?
&#34;In the year we went public, regardless of large or small enterprises, a massive number of peers wanted to rush in and do the same thing. You will find that whether it was at the time of our IPO or five years later, we are still continuously widening the gap with companies doing similar things, and even making it larger.&#34; Wang Ning said, &#34;Our scale is already quite large, the growth rate is still fast, and our overall market share is further increasing.&#34;
Even after several years, there are almost no companies in the market that can truly be considered competitors to POP MART. Wang Ning believes the core reasons are twofold. First is the hard threshold, directly related to operations, &#34;All our stores are self-operated, and all overseas stores are directly operated. This is actually a complex process of managing the business, taking 15 years to manage the team and accumulate many operational details.&#34;
In addition, Wang Ning believes that POP MART's moat also has a soft threshold, &#34;What we do is a balance of art and commerce, but these artists are irreplaceable, just like Jay Chou and Mayday in the music industry.&#34;
Times are changing, and the methods of creating IP are also constantly evolving. According to the management's summary, established IP companies like Disney often require longer cycles and more capital investment to create IP, such as using a high-cost movie to build a successful character image. But today, POP MART has changed its approach, using products to create IP.
It is worth mentioning that in 2022, during a low period, POP MART underwent a significant adjustment to its organizational structure. The IP operation department was separated, which increased the probability of good products being born, and the explosive vinyl plush series began from this.
Si De also summarized that in 2022, POP MART was even closer to being a trendy toy company, and in a more ideal state, POP MART would truly become an IP company
<h2>Going Abroad is Difficult, but POP MART Has Managed It</h2>
2024 is a milestone year for POP MART, with both performance and gross margin reaching new highs.
The biggest contributor is undoubtedly going abroad, with POP MART's overseas growth reaching 375.2% in 2024, surpassing the revenue of POP MART in 2019, fulfilling Wang Ning's forecast of &#34;recreating a POP MART overseas.&#34;
In 2024, Wang Ning entrusted the overseas business to a key figure. He is Wen Deyi, a classmate of Wang Ning from the MBA program at Peking University, a Korean who speaks fluent Chinese and is gentle in conversation. Wen Deyi joined POP MART in August 2018 and later became the first employee of the overseas business. Today, the number of foreign employees in the POP MART international team has expanded to 1,000.
&#34;We face Japanese, Koreans, Thais, Filipinos, and colleagues from Europe and the United States in meetings every day. (Cross-border collaboration) is a process of gradual accumulation,&#34; Wang Ning told Phoenix Technology. &#34;We will form local teams in different countries overseas. Although this is the most exhausting task, we recruit ourselves, open stores, and navigate many pitfalls, accumulating a wealth of experience in cross-border collaboration. This is a hard threshold, and we are just a group of people working hard to accomplish this.&#34;
With such operational experience accumulated, POP MART has gained the confidence to continue its global expansion.
Last year, POP MART made small but rapid strides in Europe, only expanding to 16 stores, most of which are street-side shops, a result of the local business landscape. &#34;We now have plans for super large stores in France and other regions,&#34; Wen Deyi told us. &#34;The European region is not only important in terms of scale; our strategy is to elevate the brand. There are many consumer brands locally, and we have many opportunities for co-branding collaborations. We are very optimistic about the positioning of the European market.&#34;
Wang Ning also shared a little story on site. Not long ago, POP MART opened a pop-up store in Barcelona, where locals queued for 6 hours just to buy a regular figurine. &#34;Our Chinese colleagues overheard two Spaniards chatting, one explaining what it was to the other, who didn't understand until the first girl sang 'LABUBU's Song' to the other girl, who then suddenly understood.&#34;
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Take POP MART's most international IP, LABUBU, for example. Its creator, Long Jiasheng, grew up in the Netherlands running a Chinese restaurant with his parents and later settled in Belgium. &#34;He is also the first Chinese to win the European Picture Book Competition,&#34; Wang Ning told us. The design language of LABUBU is very international.&#34; At the same time, Urban Paradise has become a rich soil, continuously telling the story of LABUBU to the outside world
If you have ever walked into the POP MART City Park, you would have seen the leader of LABUBU, ZIMOMO, in the forest cabin. Unlike other LABUBU, he has a tail and a round face. It is said that LABUBU was originally designed with a square face, but because she wanted to become the leader so much, her face became longer and more like ZIMOMO.
In June last year, POP MART launched a membership system in the U.S. market, with registered members exceeding 1.7 million. This year, its overseas plan includes adding about 100 new stores, with larger spaces and better locations.
If last year was the spring for POP MART, then now is the midsummer for POP MART. When asked what new OKR he would set for himself at this moment, &#34;If I really had to set an OKR, I hope to one day become the world's POP MART,&#34; Wang Ning said.
Phoenix Technology, original title: &#34;Dialogue with Wang Ning: POP MART has no secrets, OKR is to one day become...&#34;
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POP MART CEO Wang Ning publicly stated for the first time after the company's market value returned to 100 billion that there is no secret to POP MART's success; the core lies in a transparent business model and continuous innovation. Over the past five years, POP MART's revenue has grown fivefold, mainly relying on diversified products such as plush toys, high-end line MEGA, and derivatives. Wang Ning emphasized that blind boxes are just one of the business strategies and not the sole factor for the company's success

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Wang Ning: POP MART has no secrets, OKR is to become one day