Introduction:
In 2024, the designer toy industry in China experienced a peak in growth! According to Statista, the market size reached 76.4 billion yuan (approximately $10.6 billion USD), with an annual compound growth rate exceeding 25%. Leading player Pop Mart delivered enviable financial results, achieving annual revenue of 13.04 billion yuan (approximately $1.81 billion USD), a year-on-year increase of 106.9%, and an adjusted net profit of 3.4 billion yuan (approximately $471 million USD), a year-on-year increase of 185.9%, along with a soaring stock price. Reviewing the past, what has driven the overall growth of China’s designer toy industry? Looking ahead, how can products and channels break through to unlock the potential of a trillion-yuan market?
Market Situation of China’s Designer Toy Industry
The “Designer Toy Industry Development Report (2023)” defines designer toys as “toys that are centered around trendy culture, meticulously designed and produced by designers and artists, infused with rich cultural connotations and fashionable creativity.” The categories include figurine models, plush and derivative products, IP soft peripherals, etc., with the popular “Guzi” also considered a type.
The core reason for the rapid growth of China’s designer toy industry is the change in consumer demographics. In the past, individuals born in the 1970s and 1980s bought toys mostly for their children, rarely for themselves. Those born in the 1980s and 1990s would buy for both themselves and their children. Now, individuals born in the 1990s and 2000s have the purchasing power to support their favorite animation peripheral products, providing themselves with emotional value. This shift in consumption concepts aligns with the current societal environment that emphasizes self-pleasure economy and emotional value, serving as a fundamental factor in the growth of the designer toy industry.
Furthermore, the active introduction of overseas IPs and continuous marketing of domestic IPs are attracting more audiences from different circles, such as anime and games, to purchase designer toy products. Thirdly, the innovation of blind draw or blind box gameplay better meets consumers’ current consumption demands, transitioning from known functionality to the pursuit of product aesthetics, favorite characters and interactions, and the pursuit of mystery and surprise.
Especially for blind box products, brands can increase repurchase rates; from the user’s perspective, the scarcity of certain characters in blind box gameplay can lead to premiums, enhancing the product’s ancillary value in the secondary market, i.e., endowing blind box products with financial attributes. Compared to card-type products, blind boxes have stronger decorative attributes and broader application scenarios, naturally attracting more users.
Self-developed IPs account for a larger proportion of revenue, but most companies are still in the stage of obtaining mature IP licenses and innovating products. Clearly, self-developed IPs come with both risks and opportunities. For example, Pop Mart has an internal comprehensive system for replacing IP designers or managers, and utilizes the exclusivity of brand-owned stores for sales. User loyalty and future brand value will continue to rise. Mature IPs, despite having a broad user base, are generally licensed to multiple brands, leading to competition. In such cases, product innovation capabilities are tested, unless a brand secures exclusive rights to a specific IP category, similar to how Bloks Group became the leader in the Ultraman building block category, preventing the IP owner from licensing to other brands while maximizing value.
Interpretation of Designer Toy Categories and User Profiles
Based on current sales proportions, figurines rank first, followed by rapidly growing plush products, then models (including assembly), and finally soft peripherals like standees and badges. By channel, plush products have a higher online proportion due to broader regional coverage and the ability to reach many potential customers who were not originally designer toy consumers; models have a higher offline proportion because of higher unit prices, with users preferring to see the physical product before purchasing.
From user profiles, there is little difference between online and offline; individuals aged 18 to 30 are the main consumers, primarily female users, covering first- to third-tier cities, with offline adding a family consumption label. In terms of consumption behavior, online repurchase rates can reach about 30%, with blind box categories even higher. New IP releases are the main drivers of repurchase, and as the consumer group expands, repurchase rates increase. For example, new users who were 15 years old originally enter the core consumer group of 18-24 years old as they age, or the expansion of categories attracts people around 30 years old to join.
Analysis of China’s Designer Toy Channels
Online and offline channels should complement each other for designer toy manufacturers. Offline focuses on the consumption experience, currently accounting for 60% of sales, while online is responsible for reaching people, accounting for 40%.
- Offline channel functions include:
- Expanding points of sale to allow more consumers to experience the real appearance of products, including the latest materials used in design and usage, such as skin-feel paint and glow-in-the-dark features for figurines;
- Providing higher-quality customer service to enhance user brand loyalty;
- Utilizing local foot traffic and the sense of scene created by product displays to achieve sales performance without resorting to discounts or promotions that reduce gross margins.
- Online channel functions include:
- Using large amounts of online data and customer preferences analysis to help IPs create popular products, while also leveraging these hits for breakthrough sales;
- Operating IP fan bases online to establish deeper bonds with users;
- Employing diverse gameplay (such as box-drawing machines and Ichiban Kuji) to provide emotional value to consumers while increasing repurchase rates for IPs or products.
In selecting online channels, it is necessary to rely on multi-platform differentiated collaboration, with traditional e-commerce as the core, content platforms balancing marketing and sales, and private domain traffic accumulating long-term user value. Traditional e-commerce platforms such as Taobao and Tmall, with their massive user base and mature shopping ecosystem, serve as the main sales channels for brands. During new product launches or brand-day campaigns, they enable rapid reach and efficient conversion. Content platforms like Douyin are more marketing-oriented, using scenario-based content interactions to convey information, followed by livestream sales to complete a well-closed loop of viral promotion. These platforms also continuously bring incremental cross-platform sales and attract new user segments.
Private domain channels emphasize scalability and interactivity. Through fan benefits, exclusive releases, or novel gameplay, they enhance user stickiness—without requiring extra platform fees or marketing promotion expenses. In the future, as brand fanbases grow, private domain channels are expected to surpass Douyin to become the second-largest channel.
Future Development Path of China’s Designer Toy Industry
The year 2025 will be a year of continued rapid growth for China’s designer toy industry. At the beginning of the year, the “phenomenal” box office performance of Ne Zha: Rebirth of the Demon Child (abbreviated as Ne Zha 2) already demonstrated the growth trend of the animation industry. Once a work gains public recognition, it attracts increasing attention and consumption from users—designer toys follow the same logic.
From the perspective of product categories, figurines will continue to grow, while plush toys (especially soft vinyl plushes that combine the attributes of figurines and plush) are showing the most vigorous momentum. An increasing number of designer toy brands are prioritizing and launching related products, which will also help elevate the entire consumer base by another order of magnitude.
Additionally, 2025 may witness the launch of more AI-enabled toys, raising the interactivity of designer toys to a new level and opening up highly promising growth opportunities. In the long term, new technologies and materials may propel the designer toy industry to surpass the overall market size of traditional toys—making designer toys more than just “trendy toys.”
[Disclaimer]: The above content reflects analysis of publicly available information, expert insights, and BCC research. It does not constitute investment advice. BCC is not responsible for any losses resulting from reliance on the views expressed herein. Investors should exercise caution.