Scarcity and social media fuelling Labubu hype, marketer says
A marketing guru claims Labubu toys tap into the same brain wiring as poker machines, as the company behind them forecasts a nine-figure surge in profit.
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A marketing consultant says Labubus tap into the same brain wiring as pokies, as the toy manufacturer behind them has forecast its profit will more than quadruple.
Pop Mart, the Chinese retailer behind the viral Labubu toys, has flagged it expects its profit for the six months to 30 June to rise by 350 per cent from its ¥1 billion Chinese Yuan ($215 million) net profit year before.
It told investors its success was down to growing overseas revenue.
Labubus, the keychain soft toys are bought within a blind box, which hides its contents and bears one mystery toy out of multiple possible candidates.
The boxes are usually sold by Pop Mart for $85, but some ranges are discounted down to $32.
Pop Mart has released multiple series of Labubu dolls, in different colours, sizes and outfits.
If buyers aren’t lucky enough to find the specific Labubu they’re after, they can search through toys resold on Facebook and platforms like StockX, Depop and eBay- where certain editions were listed for more than $70,000.
Former Shark Tank Australia judge Sabri Suby said the unpredictability of the blind boxes were addictive and they were effectively a “legal dopamine casino”.
“You’re not buying a toy. You’re buying hope.
“The mystery box taps into the same brain wiring as poker machines: unpredictable rewards.
“It’s engineered to keep you coming back.”
Mr Suby, also a founder of digital marketing agency King Kong, added similar to Beanie Babies and Tamagotchis, Labubus were “status symbols, nostalgia triggers and collectibles”.
He said the common factors between the iconic toys were scarcity, lore and community.
“They hit a psychological jackpot.
“They give you the illusion of owning something rare, even if millions of others have it too.
“It’s not just a toy. It’s a flex.”
Labubus were dreamt up by Hong Kong artist Kasing Lung, in a story series called The Monsters, influenced by Nordic mythology.
The toys made by Pop Mart were launched in 2019 and can be bought online, as well as through retailers like EB Games.
Pop Mart also entered Australia in 2021 and now has ten physical shops across the country, across Melbourne, Sydney, Brisbane and the Gold Coast.
Last year, the company generated ¥13 billion Chinese Yuan ($2.7 billion AUD) in revenue and ¥3.4 billion ($719 million) in adjusted net profit.
Labubus have surged in popularity since celebrities including Rihanna, Dua Lipa and Lisa from Korean girl group Blackpink were photographed with them clipped to their bags.
Mr Suby said the celebrity endorsements poured petrol on a trend that was already “simmering underground”.
Labubus also weren’t just for kids, appealing to adults’ sense of nostalgia and self-expression when they clipped it to their bag, he said.
It was effectively an ID badge, showing others “you’re in the club,” he said.
Multiple buyers have posted videos unboxing the toys onto social media, which “feeds the cycle”, Mr Suby added.
“Without TikTok and Instagram, Labubu is just a weird gremlin in a box.
“But online, it becomes a personality extension.
“Every post is a mini ad that costs Pop Mart nothing and converts like hell.
“And because every box is different, it’s infinitely repeatable.”
However, Labubus could pass like any other fad, if they don’t keep evolving or if they’re oversupplied, he said.
He suggested Pop Mart could take steps to preserve their relevance, such as rewarding buyers who post social media content with giant Labubus.
He also said he would release limited collaborations with fashion brands and artists and launch pop-ups or installations.
“To stay hot, they’ll need new characters, collabs, formats and surprises,” he said.
“If they stand still, the internet will move on.
“Beanie Babies crashed because they stopped feeling rare and started feeling cheap.
“If Labubu becomes too available or loses its cultural edge, collectors disappear overnight.”
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Originally published as Scarcity and social media fuelling Labubu hype, marketer says
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