Gifts / Sports & Toys

According to Euromonitor data, LEGO's market share in the Chinese market in 2020 was 42.3%. However, many domestic brands, including Bangbao Puzzle, Star Diamond, Senbao, and Bruco, have a market share of less than 5%.

Although in terms of market share, Lego has achieved a dominant position. But this does not affect the domestic building blocks to keep up with the new trend of "national tide consumption" and tap new growth space. Especially under the influence of the epidemic, building blocks at home has boosted the development of the industry. On the e-commerce platform, the building blocks category has built up a market of tens of billions of dollars.

According to the "Tmall Trend Toy Industry White Paper", the toy market is becoming more mature, and building blocks have become the category with the highest repurchase attribute in the toy industry. Since the 618 pre-sale this year, the cumulative amount has increased by more than 100% year-on-year. Among them, more than 50% of the building blocks produced by the toy supply chain in Chenghai, Guangdong, including Enlightenment, Senbao building blocks, Keeppley, Loz, Goody and other brands were born and grown here, and have entered the attention of consumers.

In Chenghai, Guangdong, the "toy capital of China", almost every household is making toys. In order to break the cognition of "low-cost building blocks", in 2019, the Jankada brothers re-founded Keeppley, a trendy building block brand based on the enlightenment of the building block brand founded by their father, not only with Doraemon, Pokemon, etc. Co-branded with well-known IPs, it also created phenomenon-level Guochao products such as China Aerospace series and Guoman IP series, which are loved by consumers.

Lin Zezhe, the founder of Senbao Building Blocks, is not only the third-generation player of Chenghai Building Blocks, but also has 20 years of experience in making toys. In 2013, it entered the building block market. Through the IP of Wandering Earth, it successfully captured the psychology of this young consumer to follow the trend, realized the brand breakout, and continued to develop original products to open its own development path. In terms of products, Senbao Building Blocks has formed three product lines of building block joint film and television IP, Guochao IP, and original products. It is understood that in terms of revenue, the sales of Senbao building blocks joint series accounted for 40%, and the sales of original product lines accounted for 60%.

We see that under the catalysis of new consumption, domestic building blocks continue to break through themselves and explore new opportunities. On the one hand, in cross-border IP cooperation, Keeppley and the Forbidden City jointly launched the Guochao series, and Senbao Building Blocks cooperated with the Guochao IP Wandering Earth, Shandong Jian, and Sanxingdui series. While developing its own IP, it is also strengthening the national trend. Wind IP construction is closer to traditional Chinese culture.

On the other hand, to avoid the homogenization of IP, many manufacturers have developed a new splicing method "mortise and tenon", hoping to reflect the traditional Chinese craftsmanship through the assembly method originated from Chinese architecture, thereby attracting the attention of players. In addition, in terms of cost performance, the price of domestic building blocks is more advantageous than that of Lego, which costs hundreds to thousands of yuan.

The building block track has attracted much attention from capital

Following the popularity of trendy games such as blind boxes and figures, building blocks have attracted the attention of capital as another emerging track. According to the statistics of Lei Bao, there are currently domestic building block brands such as Senbao Building Blocks, Coincident Building Blocks, Bruco, and Pinqi.

In February this year, Senbao Building Blocks completed a series A financing of hundreds of millions of yuan. Investors include Alibaba, Toutoushidao Fund and Honghui Capital. While cultivating products, Senbao Building Blocks is also exploring new sales channels. It is reported that in 2020, the sales created by live streaming will account for about 20% of the sales of Senbao Building Blocks in the entire e-commerce segment.

In mid-January 2022, based on the development and innovation of traditional mortise and tenon technology, the founder of Chinese building blocks, mortise and tenon, received tens of millions of angel round financing from Meihua Venture Capital and Xiaohongshu. In terms of user positioning, coincidence spans two age groups, children aged 3 to 16 and adults over the age of 16, to meet the needs of consumers in terms of entertainment, fun, good looks, education and other needs. Although the coincidence tenon-and-mortise building block was established in 2020, it still wants to open up a unique "Chinese" building block toy road through a new entry point.

In addition, Bruker has received 3 rounds of investment. In 2018, it received an angel round of investment from Cibos Investment, and in 2020, it received a 330 million RMB A round of investment from Gaorong Capital, Source Code Capital, and Legend Capital, and in 2021, it received Yunfeng Fund, Legend Capital, Gaorong Capital and Source Code Capital joined in a 600 million Series B investment. It is reported that Bruco will use the financing to upgrade and improve the "research, production, marketing and sales" links of the "Building Block +" industrial chain, thereby further consolidating the brand moat and enhancing the industry's competitive advantage.

With the blessing of capital, toy companies have stepped up their horsepower to seize the market, or co-branded Guochao IP/developed original IP, or found a new splicing method "mortise and tenon", and began to confront LEGO head-on.

Can domestic building blocks support the next outlet? What are the differences compared to Chaowan? According to industry insiders, building block products are more difficult, have longer design cycles, and have more obvious challenges than trendy play products. In terms of product design, it is not only necessary to consider the storytelling, compatibility, and authenticity of consumers building blocks, but also to test the process mold, design, materials, supply chain, etc., and there is still a long way to go in the future.