Gifts / Sports & Toys

For young people who love fashion fun, consumers can feel strongly about the product with a little "quality".

Recently, there have been frequent incidents such as the price increase of Bubble Mart products and the large number of defects in new models, which has caused consumers' discomfort and doubts about Bubble Mart.

Correspondingly, after the rapid rise in the stock price of Bubble Mart at the beginning of its listing, it has continued to fall for more than two months.

Is there any connection between the performance of the capital market and Bubble Mart’s product issues? What kind of calculations does Wang Ning have under the blatant price increase? What happened to Bubble Mart? With price increases, quality control defects, and after-sales problems, did Wang Ning open Bubble Mart’s Pandora's Box?

01

Relying on price increases to "save" Bubble Mart's share price?

Since April this year, Bubble Mart, which is famous for its "blind box" concept, has launched a number of new blind boxes. At the same time, the unit price also rose from 59 yuan to 69 yuan, an increase of 16.9%.

Subsequently, the media launched a survey on the price increase of Bubble Mart. In this survey involving more than 1,500 people, most consumers said that they had never bought or could not accept the price increase, and only a very small number of consumers said they could. Accept the price increase of Bubble Mart.

In this regard, independent economist Wang Chikun believes that the purpose of this price increase should be to enhance the company's performance growth.

In the past month, the market value of Bubble Mart has experienced a wave of decline, from the highest point of 107 Hong Kong dollars to 60 Hong Kong dollars. No one thought that Bubble Mart's stock price fell as fast as it took to the altar.

The change in the market's view of Bubble Mart may be caused by its poor performance.

The latest annual report shows that in 2020, Bubble Mart's revenue was 2.51 billion yuan, a year-on-year increase of 49.3%. In the past three years, Bubble Mart's revenue growth has been more than 200%.

At the same time, the gross profit margin of the company's branded products has also begun to decline, from 71.2% in 2019 to 68.7% in 2020.

Pressure from the capital market and performance may be a more direct reason for the price increase for Bubble Mart.

Regarding the price increase of new products, the relevant person in charge of Bubble Mart responded to the media: "Raw material prices increase and process design increases costs." However, many consumers do not buy into such a response.

As a result, some netizens issued a cross-examination: "Bubble Mart's gross profit margin is so high, so you are embarrassed to increase the price?

Some players even posted a post immediately after learning about the price increase of Bubble Mart's new product. "Goodbye, it's already expensive, but the price will increase." "It is said that the price will increase in the future. I don't think I can afford it. I will go back quickly."

Although the price increase of 10 yuan will not scare away the core customers of the blind box, it does not mean that Bubble Mart will be able to play the blind box economy unscrupulously in the future, nor does it mean that the price increase will not have a reputation for the Bubble Mart brand. Certain negative effects.

02

Bubble Mart "out of control" 70% of the new products are defective!

Not only is the price increase, but what makes fashion lovers even worse is that the quality control of Bubble Mart began to deteriorate significantly after the listing.

Tucao about Bubble Mart has appeared on social platforms such as Weibo, Xiaohongshu, and Blind Box Communication Group. Among the many accusations, the voices of dissatisfaction about Bubble Mart's quality control and after-sales service are the most.

Many buyers said, “I don’t know if it’s the reason why Bubble Mart went on the market. The quality control is not as good as before. I was happily picking up babies, but because of defective products, the buying experience was greatly affected.”

The core of Chaowan is Chaowan rather than blind box; the blind box draws category rather than quality. Due to the pressure of the capital market and performance, the action is deformed, and the defective products are still on the shelves knowing that the product quality is defective. The product quality problems are disrespectful to consumers and violates the industry belief that Chaowan should bring consumers a good experience .

Recently, Bubble Mart released the new Skullpanda craze series. The bear cat craze is the second series of Skullpanda. On the night before the sale, fans began to line up in front of Bubble Mart stores in various cities across the country, which was extremely popular.

No one thought that behind the popularity is the disappointment of the fans.

As the Skullpanda blind boxes were successively acquired, many netizens said that they had received defective products. Netizen "One Sheep" said that while accepting the price increase, he also expected better quality. However, the reality has given a heavy blow. , This time Skullpanda lacks accessories, overflowing glue, mixed colors, etc. It is obvious that there are even a box of 12 blind boxes, of which 10 blind boxes are defective. According to netizens on Weibo, the defect rate of blind boxes is as high as 70%.

In addition, Pao Mart’s product quality has always been questionable.

As of May 7th, there were 3746 complaints about Bubble Mart on the Black Cat Complaint Platform. The complaints focused on issues such as non-refundable delivery delays, and non-refundable non-refundable products after defective goods were returned to the factory.

Not only is there a problem with quality control, but the after-sales service of Bubble Mart has been criticized by fans. After receiving the defective product, the fan decided to exchange the product, but the customer service said that because there was no stocking, the replacement would take more than half a month. Some consumers said that the blind box they received was still defective after the replacement.

Because there are only 60,000 sets of the Xiongmiao craze series on sale this time, they are all sold out once they are online. Many netizens said that on the day of the sale, a clerk had already reselled the goods on the second-hand platform, and the price of the entire box of 12 boxes was as high as 15,000 yuan.

For manufacturers, the main purpose of this hunger marketing is to increase prices in the second-hand market, so that the prices of products on the second-hand market continue to rise.

As early as December 22 last year, Paomat was sold a second time in a blind box. According to netizens, there are traces of yellow glue on the seal of the blind box purchased at the Bubble Mart Jinan store, which is suspected to be sold again after being opened.

After that, Bubble Mart responded that the situation was true. Five employees violated the regulations, the labor contract has been terminated, and all the goods involved have been recovered.

The deeper problem is that Bubble Mart's heavy reliance on celebrity IP has the risk of "passage", and the new "IP" cultivation and creation capabilities have not yet been clearly revealed, and the authorized "IP" also has the risk of expiration.

In addition, the threshold for blind box sales is not high. Many companies have already entered the game. Bubble Mart will face more fierce competition. According to the observation data of Third Bridge Gaolin Consulting, the sales of Cool Music Play Blind Box has exceeded 100 million yuan, accounting for as much as 10% of the entire industry's sales, which is not as good as Bubble Mart.

For now, Bubble Mart is far from dominating the market.

Among the trendy brands of Blind Box, besides Bubble Mart, the top ten in domestic sales, Long Cao Yan Wen, Wu Huang Wan Sleep, Littleamber, Luo Xiaohei, and Ari are all occupying the market, and some products are also in the market. The price is lower.

In contrast, Bubble Mart seems to have no story, no history, and a bit of feelings, so Bubble Mart’s works lack vitality. This will seriously affect users' recognition and dependence on their IP.

03

The ability to create original and popular IP is worrying, where is Bubble Mart?

Whether it is in terms of performance or new aspects, Bubble Mart is gradually losing its "power" at the beginning of its listing.

It is understood that Bubble Mart’s advantage lies in IP operation and creation and design. As of June 30 last year, there were 93 IPs under its umbrella, including 12 own IPs, 25 exclusive IPs and 56 non-exclusive IPs. Among them, Molly is the trump card of Bubble Mart. In 2019, the sales of Molly reached 456 million.

The financial report shows that the income of Molly and Dimoo in Bubble Mart's own IP accounted for 14.2% and 12.5%, and the income of PUCKY and TheMonsters in the exclusive IP accounted for 11.9% and 8.1%, respectively. As a newly launched IP, SKULLPANADA will account for only 1.6% of its revenue in 2020.

Careful observation, it is not difficult to find that Molly's sales are also declining. From 2018 to 2020, Molly's revenue accounted for 62.9%, 32.9%, and 14.2%.

The decline in sales of Ace IP has put pressure on Bubble Mart's supply chain management. Previously, Bubble Mart concentrated a lot of resources on core products such as Molly, and the decline in sales of these categories put pressure on the supply chain management of Bubble Mart.

In 2020, the cost of sales of Bubble Mart is as high as 919 million yuan, a year-on-year increase of 55%, exceeding the revenue growth rate over the same period. It is reported that this is mainly due to the substantial increase of Bubble Mart's inventory in 2020. As of the end of 2020, Bubble Mart's inventory has increased from 96 million at the end of 2019 to 225 million, an increase of 134% year-on-year, and the inventory cost included in the cost of sales is as high as 748 million.

At the same time, inventory turnover days have also increased from 46 days in 2019 to 78 days, and the turnover cycle has been extended. However, Pao Mart said that this is due to its business expansion, the number of IPs and the increase in new products, which has increased its demand for goods.

Among the many IPs, only 3 of Bubble Mart will account for more than 10% of revenue in 2020, namely Molly, Dimoo and PUCKY. Among them, PUCKY's 2020 revenue was 300 million yuan, a year-on-year decrease of 4.76%.

Among the three blind boxes, the sales of two have shown a year-on-year decline. From the side, consumers’ aesthetics are constantly changing, and the stickiness of Bubble Mart’s IP is declining. This also shows that Pao Mart’s original ability is insufficient.

With the weak performance, Bubble Mart became anxious and kept launching new IPs to supplement its core competitiveness. However, if the pace was too great, many problems would arise instead.

If you act too hastily, it will inevitably be shoddy. The flaws in the Xiongmiao craze series are the best proof.

IP is different from other products, this is a process of accumulation.

Judging from the current operations of Bubble Mart, almost all come from direct sales of goods, rather than from content to goods. The lack of an intermediate construction process is naturally a challenge to the IP life cycle. The decline in IP viscosity is undoubtedly accompanied by the abandonment of consumers. Once they are abandoned by consumers, Bubble Mart will be on the verge of danger.

However, a large number of players said that the design of Bubble Mart has declined severely, and the quality control is getting worse and worse. It is a bit unable to create its own original IP, and some unknown original designs cannot attract players at all.

Co-branded models such as Marvel, Harry Potter, and Mickey must consume a lot of cost, so the products have become increasingly unpopular in recent years.

Because consumers can't get products that match them when they spend money, the premium space is all spent on marketing and hidden models, which makes players more heartbroken.

For companies that involve creativity and physical sales, the talent pool in original design and supply chain management is the top priority. Bubble Mart has a large number of new product defects and quality control problems, as well as a lack of supply chain management due to a substantial increase in inventory. Deeply speaking, it is a manifestation of brain drain, which is also a fatal problem involving physical sales. .

The 2020 prospectus shows that the average annual salary (including benefits) of Pao Mart is around 100,000 yuan, which is not high for Pao Mart, which is mostly located in first- and second-tier cities. Pao Mart “cherishes money” so much. , The risk of brain drain will follow.

04

Conclusion

Xinhua News Agency previously commented that "blind" boxes cannot be sold "blind", let alone the word "blind" to harm consumers' rights and interests. Regarding the motive of the price increase of Bubble Mart, the next financial report will give an accurate answer.

In fact, since its landing on the Hong Kong Stock Exchange in December last year, Bubble Mart has been controversial due to the "bubble theory". But the direction of the trend is elusive, and Bubble Mart itself can be said to be a huge blind box.

According to industry insiders, for Bubble Mart, which relies on the head IP to attract users and generate income, the lack of IP appeal is not good news. This also confirms that Bubble Mart’s blind box play has a short life cycle and requires Repetitive manufacturing of explosive models can maintain growth.

At the moment, blind box price increases, revenue slowdown, market value shrinking, and IP capabilities are worrying. These may be the only way for Bubble Mart. With the increasing rise of new players, Bubble Mart can still play in the tide How long does the industry stand by?