Analysis of Pop Mart's Business Model and Long-Term Investment Value

Based on an in-depth analysis of Pop Mart’s business model, I will systematically evaluate its long-term investment value from three dimensions.

Pop Mart adopts a lightweight IP path of ‘Image First → Emotional Resonance → Product Monetization’, which is in sharp contrast to Disney’s content-heavy model of ‘Story First → Emotional Connection → Product Monetization’ [4]. Its core mechanism is to establish user connections through

rather than approaches.

Data shows that this model has been extremely successful in financial performance. In H1 2025, Pop Mart achieved revenue of 13.88 billion yuan, a year-on-year increase of 204.4%; gross profit margin reached 70.3%, and adjusted net profit was 4.71 billion yuan, a year-on-year increase of 362.8% [1]. This profitability even exceeded the 3.961 billion yuan net profit of Kering Group (parent company of Gucci) in the same period [1].

Pop Mart is essentially a

, and its operation model includes [2][3]:

• Artist Discovery System
  : Maintains contact with over 350 artists, adopts the ‘Art Partner’ model (basic buyout fee + tiered sales sharing), with an average incubation cycle of 8-12 months
• IP Classification Operation
  : Operated 93 IPs by the end of 2023 (12 self-owned IPs, 25 exclusive IPs, and 56 non-exclusive IPs)
• Whole Industry Chain Layout
  : Controls the entire industry chain from front-end trendy toy exhibitions, design and development, OEM processing to self-operated channels

Pop Mart adopts a ‘light asset + outsourcing’ model, with production outsourced to about 20 OEM factories in Dongguan (China), Vietnam, etc., which gives it

similar to Zara [3]. Through a strong digital system, Pop Mart can quickly respond to market changes and achieve accurate order forecasting and inventory management.

Dimension	Disney	Pop Mart
Core Driver	Content Ecosystem Closed Loop	Visual Symbol Driven
User Connection	Deep Emotional Resonance + Worldview Recognition	Appearance Preference + Emotional Healing
Monetization Path	Movie → Streaming → Licensing → Derivatives	Image → Product → Derivative Licensing
Cost Structure	High Content Investment + Low Marginal Cost	Low Content Investment + High Manufacturing Cost
Lifecycle	Long-Term Continuous Renewal	Rapid Iteration and Update

Disney has a complete ‘Content as IP’ ecosystem closed loop, relying on animation and movies to shape character storylines and personality settings, establishing deep emotional connections [4]. However, Pop Mart’s IP lacks complete narratives and worldview settings, so its content derivative space is relatively limited [4].

The two have high similarities in supply chain management:

:

• Rapid Response Mechanism
  : Zara achieves 14-day design-to-shelf through digital systems; Pop Mart quickly launches new products through data insights
• Accurate Forecasting Ability
  : Zara makes accurate forecasts through store data; Pop Mart dynamically adjusts IP strategies through sales data
• Light Asset Operation
  : Zara mainly relies on its own supply chain but manages it centrally; Pop Mart fully outsources production

:

• Product Characteristics
  : Zara’s products are fast-consuming fashion items; Pop Mart’s products have collection attributes
• Value Driver
  : Zara relies on design trends; Pop Mart relies on IP influence

:

1. IP Acquisition Capability
   : As a platform-based trendy toy IP enterprise, Pop Mart participates in the early incubation of artist IPs and has established a strong artist resource network [7]

2. Whole Industry Chain Control
   : Covers the entire process of IP discovery, incubation, operation, and commercialization, forming integrated operation capabilities [7]

3. Global Layout
   : As of June 2025, it has opened 571 stores in 18 countries worldwide, and the proportion of overseas revenue continues to increase [2]

4. Data-Driven Advantage
   : Has 34 million member data, enabling accurate insight into consumer preferences [3]

:

1. Insufficient IP Stickiness
   : Lacks deep story support, user connections remain at the surface level, and emotional loyalty is relatively weak [4]

2. Artist Dependence
   : Core artists’ independence and bargaining power are increasing, which may affect the stability of long-term cooperative relationships

3. Trend Cycle Risk
   : As a ‘trendy aesthetic symbol’, it faces the risk of periodic fluctuations in trend popularity [4]

4. Cultural Difference Challenge
   : Faces challenges such as low acceptance of blind box culture and strict regulation in European and American markets [4]

:

• Rapid expansion of overseas markets: The American market grew by 744.3% year-on-year, and the European market grew by 569.6% year-on-year [2]
• Diversification of IP matrix: The five major IPs (THE MONSTERS, MOLLY, SKULLPANDA, CRYBABY, DIMOO) all achieved revenue exceeding 1 billion yuan [2]
• New business exploration: New formats such as dessert shops, jewelry stores, and the game ‘Dream Home’ [2]

:

1. Content Upgrading
   : Animate and gamify core IPs to extend IP lifecycles and deepen user emotional connections [4]

2. Light Asset Licensing
   : Learn from the Sanrio model, license IP images to clothing, accessories, food and other fields to establish stable cash flow [4]

3. Experience-Oriented Formats
   : Build trendy theme parks and trendy toy exhibition halls to strengthen offline experience and brand stickiness [4]

4. Digital Entertainment Integration
   : Through virtual-real linkage strategies, strengthen IP narrative capabilities and establish an extensible story ecosystem between digital entertainment and physical experience [6]

Although Pop Mart’s ‘Content-Free IP’ model is not as deep as Disney’s in emotional connection, it performs excellently in

and . A gross profit margin of 70.3% and a net profit margin of 33.9% show extremely strong business model efficiency [1].

Compared with traditional toy companies (such as Lego, which needs to pay high IP licensing fees), Pop Mart has independent IPs, avoiding licensing cost pressure, which constitutes its core competitive advantage [4].

:

• Verified business model and profitability
• Strong IP incubation platform and whole industry chain control
• Huge space for global expansion
• Exploration potential of new business formats

:

• Challenges in IP lifecycle management
• Internationalization barriers due to cultural differences
• Structural risk of artist dependence
• Unpredictability of trend cycles

:
Pop Mart’s ‘Content-Free IP’ model is a rather than a simple flaw in the business model. Its essence is an industrialization path that pushes niche art to the general public through and .

In the medium to long term, if Pop Mart can successfully achieve: 1.

to enhance the depth of emotional connection; 2. to overcome cultural differences; 3. to reduce dependence on a single IP, it has the potential to become a leader in the new generation of consumer brands. However, investors need to closely monitor its IP lifecycle capabilities and the execution effect of internationalization.

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[1] 36Kr - ‘Pop Mart Makes More Money Than Gucci | Big Spending Events’ (https://eu.36kr.com/en/p/3431034856312201)

[2] Southern Metropolis N Video - ‘Pop Mart Half-Year Report: Revenue and Net Profit Exceed Full-Year of Last Year, LABUBU Attracts Huge Money’ (https://m.mp.oeeee.com/a/BAAFRD0000202508191113800.html)

[3] Digitaling.com - ‘Behind Pop Mart’s Explosion: Why It Can Build a 100 Billion Commercial Empire’ (https://www.digitaling.com/articles/1370452.html)

[4] Huxiu - ‘Before Becoming Disney, Pop Mart Will First Surpass Lego’ (https://www.huxiu.com/article/4816768.html)

[5] Poseidon Partner - ‘Pop Mart: Is It a Bubble or a Evergreen Empire?’ (https://www.poseidon-partner.com/marketviews-tc/pao-pao-ma-te------shi-pao-pao-huan-shi-chang-qing-di-guo)

[6] Guojin Securities Research Report - ‘Investment Logic Profit Forecast, Valuation and Rating Risk Tips’ (https://pdf.dfcfw.com/pdf/H3_AP202504031650735623_1.pdf?1743680508000.pdf)

[7] SPD International - ‘Not All Trendy Toys Are Pop Mart’ (https://www.spdbi.com/getfile/index/action/images/name/中国潮玩行业：不是所有玩具都是潮玩，不是所有潮玩都是泡泡玛特_浦银国际研究.pdf)

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