The case analysis brought today is the disassembly of Pop Mart's private domain case, enjoy~

1. Case Background

1. Case Introduction

Pop Mart is a trendy toy brand that has become very popular in recent years. Pop Mart sold 50 million trendy toys in 2020, with annual revenue reaching 2.51 billion yuan, of which online revenue was 952 million yuan. The proportion of online sales continued to increase, from 9.4% in 2017 to 37.9% in 2020. The mini program "Pop Mart Box Drawing Machine" alone contributed 460 million yuan in revenue. In the first half of 2021, Pop Mart’s online revenue was 678 million yuan. The company's rapid revenue growth mainly benefited from the accelerated expansion of membership numbers. The cumulative number of registered members from 2018 to 2020 increased by 133%/214%/250% year-on-year, reaching 11.42 million in the first half of 2021, and revenue contribution increased from 88.8% in 2020 to 91.8%. The member repurchase rate is 49%. The figure below shows the revenue share of each channel of Pop Mart in 2020. The combined revenue share of the Tmall flagship store and the Pop Mart box machine is as high as 35%. At the same time, on October 15, Pop Mart launched its 11th anniversary surprise celebration event & Double Eleven theme event, setting up different activity modes on the WeChat and Tmall platforms. This article will analyze Pop Mart's operating system from the aspects of Pop Mart's traffic, activities, and monetization.

2. Dismantle the target

• Combined with the anniversary celebration activities, a comprehensive understanding of Pop Mart's private domain operation system

2. Company Introduction

1. Industry Overview

Pop Mart is a leading company in China's trendy toy industry. In 2019, its market share in the blind box field was 8.5%, ranking first.

(1) Market size

According to iMedia Consulting data, the scale of the global trendy toy industry reached 149.3 billion yuan in 2020, a year-on-year increase of 19.7%.

(2) Main categories

By type, trendy toys can be roughly divided into four categories: action figures, blind boxes, BJD toys, and art toys. Since the specific product style of the blind box cannot be known before purchase, it can give players a sense of surprise and excitement. The artistry is more popular, the price is lower, and it has the widest audience.

(3) Competition landscape

The industry concentration is low, and Pop Mart has a leading market share. According to data compiled by Frost & Sullivan, in 2019, the CR5 of China's trendy toy industry was 22.8% in terms of retail value, and the concentration was still relatively low. The market shares of the top five participants were 8.5%, 7.7%, 3.3%, 1.7% and 1.6% respectively. Among them, Pop Mart is the largest trendy toy brand, with a market share of 8.5%.

2. Company Profile

(1) Development history

The company was founded in 2010 and positioned itself as a retailer of trendy toys, stationery and sundries in its early stages of development. The first Pop Mart store opened in the Beijing OMEH Shopping Center. In 2015, founder Wang Ning got inspiration from the best-selling Japanese blind box IP Sonny Angel. The following year, he signed a cooperation agreement with Molly creator Wang Xinming to launch the first blind box toy "Molly Constellation Series". The company officially transformed from a channel operator to an IP incubator and operator. Since 2017, the entire trendy toy industry chain has been opened up. At present, the company has built a comprehensive operation platform covering the entire trendy toy industry chain around four areas: artist discovery, IP incubation and operation, consumer reach, and trendy toy culture promotion. As of the first half of 2020, the company owns 93 IPs, of which independent and exclusive agency IPs total 37; in terms of offline channel layout, the number of retail stores reached 187 by the end of 2020, and the number of robot stores increased to 1,351.

(2) User Profile

Blind box players are mainly young women aged 18-29. According to Guyu Data’s survey of Pop Mart users, female blind box players account for as high as 75%, with young people aged 18-29 (58%) as the main consumer group; most users are white-collar workers with certain consumption power, and users with an income of 8,000-20,000 yuan account for 90%; in addition, students are also a core purchasing group. Self-pleasure consumption is the main feature of young people's purchase of blind boxes, including pursuing the excitement of blind draws, paying for appearance, and satisfying social collection needs.

(3) Product categories

3. Advertising

Advertisements are concentrated on the Taobao platform.

3. Pop Mart’s Private Domain Matrix

The network-wide fan matrix of over 10 million has created a super strong private domain lineup and conversion power for Pop Mart.

1. Tmall flagship store – 456w fans

Tmall is one of Pop Mart’s main operating and sales bases. In 2020, the revenue of the Tmall flagship store accounted for 16% of Pop Mart’s total revenue. Tmall platform has an independent membership system and Tmall platform-exclusive activities, as well as a Pop Mart blind box drawing machine. In addition to directly purchasing blind boxes, users can also draw boxes online, putting the drawing experience in front of them. Tmall’s live broadcast room is broadcast every day, and users can see the entrance to the live broadcast room by clicking on the flagship store’s homepage.

2. Weibo official account — 957,000 followers

Pop Mart’s Weibo account is positioned as an official brand announcement, and mainly operates super chats, new product announcements, network-wide activities and other content.

3. Xiaohongshu official account — 295,000 followers

The operation level of Xiaohongshu account is relatively low, mainly focusing on releasing new products. It has a Xiaohongshu store to facilitate the direct conversion of users who have been inspired by Xiaohongshu, but the platform contributes little to the performance.

4. JD.com flagship store – 1.547 million fans

As the official mall of JD.com, its overall logic of content display, membership system design, and Double Eleven activities are similar to those of Tmall flagship store.

5. Douyin official account – 186.5w followers

There are two official accounts on the Douyin platform, namely POPMART, with 1.812 million fans, and Pop Mart Official Flagship Store, with 53,000 fans. The POPMART account focuses on content and increasing followers. The Pop Mart flagship store has opened a Douyin store and has broadcast 13 live shows from October 10th to date, with the frequency ranging from once every two days to once a day. The sales of the 13 live shows are expected to reach 465,000 yuan.

POPMART:

Pop Mart official flagship store:

Pop Mart official flagship store's sales and revenue from 13 live broadcasts in October:

Tik Tok bubble box machine:

Compared with WeChat and Tmall platforms, the entrance to Douyin’s bubble box machine is not obvious, and there are fewer products. When you click on the blind boxes, they all show that they are sold out. Under topics related to the Pop Mart box-drawing machine, most users discussed their experiences of drawing boxes on the WeChat mini-program. This shows that the number of users of the Pop Mart box-drawing machine on the Douyin platform is small and the level of operation is low.

6. WeChat Ecosystem

(1) WeChat public account: estimated number of followers: 1.5 million+

There are three official accounts under it: POPMART, Pop Mart Faner and Pop Mart Member Club. As its official official account, POPMART undertakes all functions and main content dissemination; as an unofficial official account, Pop Mart Faner mainly shares stories about Pop Mart with users (relatively fewer people follow it); Pop Mart Member Club mainly operates member-related matters, and the menu bar directly leads to the box-drawing machine and Pop Mart Member Center.

Pop Mart official account: Offline physical stores will direct traffic to the official account. The official account releases new products and various activities on a daily basis, and the bottom menu bar can directly lead to the official mini program and bubble box machine.

(2) WeChat Mini Program

• Pop Mart Mini Program

Offline consumption points are accumulated in the mini program. The mini program contains membership system-related activities, WeChat Mall, and the entrance to the bubble box machine.

• Bubble box machine

The online box drawing platform has enhanced the experience of buying blind boxes online. The membership system points are interoperable with the Pop Mart mini program, which is one of Pop Mart’s important sources of income.

(3) WeChat Video Account

As the promotional platform of Pop Mart on the video account, the profile has related public accounts and corporate WeChat, and the corporate WeChat has a related box-drawing machine. This series of traffic directly allows you to buy boxes and draw boxes, which is really amazing!

(4) WeChat community

The official WeChat community has no functional distinction, it is all about event operation and box draw communication, etc. (subsequent operations will be launched)

7. PaQu APP

The trendy toy community APP under Pop Mart allows people to communicate about doll modifications, take photos of dolls, watch artists, resell blind box figures, etc. (The amazing thing is that you can swap it directly between the box and the cabinet, which is a great feature).

However, the APP was not promoted much, with only 1,500+ downloads on IOS, and many veteran box-drawing players were unaware of its existence before.

8. Other platforms (Bilibili & Zhihu)

The operation level is low, but there are a certain number of fans.

Summary: Pop Mart's private domain matrix is ​​mainly based on Tmall and WeChat platforms. This can be seen from the revenue of each platform in its financial report. Other platforms are more like "a presence that cannot be absent". In addition, the Douyin live broadcast room is more like the new private domain focus this year. During the Double Eleven period, the live broadcast continued for 24 hours, but the subsequent operation level still needs to be tracked. It is worth mentioning that the bubble box machine, as a product of "online box drawing experience", has gradually expanded from WeChat mini-programs to Tmall and Douyin platforms.

4. Pop Mart’s private domain traffic diversion

Pop Mart’s private domain position is currently mainly concentrated on the WeChat platform. It retains users in the private domain system through offline diversion and diversion between various sections within the WeChat platform, and improves private domain operation efficiency through continuous refined operations.

1. Offline store traffic diversion

When users shop at more than 180 offline stores across the country, store clerks will guide them to register as members and present the mini-program membership code. The hook that usually guides users to register as members is "register for free, points can be used as cash, and other benefits."

2. Offline robot store traffic diversion

Pop Mart has more than one thousand robot stores offline. When users visit a robot store to make a purchase, they need to scan the code to wake up the mini program, complete the membership and payment settlement, and then get the blind box. All users who visit the robot store to buy blind boxes will become members and be registered in the WeChat mini program.

3. Online mini-program traffic diversion

There are multiple entrances to the group in the Pop Mart mini program, and users can directly join the corporate WeChat fan group through the page instructions.

5. Pop Mart Membership System

As of now, Pop Mart has accumulated more than 10 million members in the WeChat private domain, and the effect of the membership system is obvious: in the first half of 2021, members contributed more than 90% of sales, and the member repurchase rate was 49%.

Pop Mart’s membership system has a total of four levels. The membership names, points rules, and benefits are different on different platforms, but they all follow the principle of “the more you consume, the higher the membership level and points.” The standards for the four levels of membership are: V1—consumption of 0 yuan, V2—consumption of 500 yuan/8 times, V3—consumption of 2000 yuan/18 times, and V3—consumption of 8000 yuan/28 times. Based on the unit price of 59 yuan and 69 yuan for the blind box with the most sku in Pop Mart (59 yuan for the old series and 69 yuan for the new series starting from April this year), a member needs to buy at least 8 blind boxes to upgrade to V2, which is about the same amount as 8 consumptions. Considering that Pop Mart launched an average of 5.8 new blind boxes per month in 2020, and 70% of users will buy blind box toys of their favorite specific styles more than 3 times, it is not difficult for users to complete the membership upgrade from V1 to v2. According to the author himself and his friends who love to buy blind boxes, they are not particularly concerned about membership upgrades. They are more concerned about the fun brought by buying blind boxes itself. Membership benefits are the icing on the cake. This is probably the reason why Pop Mart does not have any other tiered operations for members of different levels.

1. WeChat Mini Program Membership System

The WeChat mini program membership system is linked to offline stores and lottery machines, and is reflected in member benefits.

• Membership level: Newbie, Advanced Player, Newcomer in the Doll Circle, Collector Tycoon

Membership threshold: No threshold, just register

Member benefits and privileges: Members of different levels will have different box drawing machine reminder cards and display cards, points redemption, free shipping benefits, toy house, exhibition and mall privileges, etc.

Points redemption: cash back for offline consumption (5 yuan off for every 100 yuan spent), redemption of coupons, blind boxes, figures, peripherals, and exclusive redemption benefits for V3-V4. There are more peripheral items and figures that can be exchanged in the WeChat Mall.

2. Tmall flagship store membership system

Compared with JD.com, Tmall’s membership system has more gameplay and a higher level of operation.

• Membership level: Newbie, Advanced Player, Newcomer in the Doll Circle

• Membership threshold: Not only is there no threshold, but you will also receive a 20 yuan coupon.
• Member Activities: Exclusive member activities.

(1) Member recharge: recharge different amounts to receive shopping credits

(2) Members can participate in the lucky draw to try out new products (including fission): You can participate in the lucky draw for free by applying for a trial and filling in your address, but completing tasks (browsing blind box products, inviting friends) can increase your chances of winning.

(3) Fission discount: Share with 3 friends to get an exclusive fission coupon worth 30 yuan.

3. HACIPUPU lottery

HACIPUPU Ha Xiaoyou is a limited edition Halloween-themed doll released by Pop Mart on its 11th anniversary (which coincides with Halloween). The sales channel is only through the [Pop Mart Box Machine] WeChat applet. A total of 509 dolls are sold, each priced at 680 yuan. Members can only obtain "purchasing qualifications" by participating in the event in the WeChat mini program [Pop Mart Box Machine]. This activity and the next fission activity are both launched for this blind box.

Event details: You can get bubble scratch cards through daily sign-in, participating in box draws, and help from friends. Scratch cards can be used to obtain purchase qualifications, and the probability of success is 0.1%. For every 5 friends you successfully invite, you can get one more scratch card, up to a maximum of three, which means you can invite up to 15 friends to help.

• Activity bait: Limited edition doll HACIPUPU Ha Xiaoyou purchase qualification
• Activity threshold: Register as a member of Pop Mart Box Machine Mini Program
• Activity rules: Invite 5 different friends to help you to get a scratch card. You can invite up to 15 friends to help you.
• Activity path: Same as the previous activity

4. Invite friends to light up the wish bottle

This is also an activity for HACIPUPU Ha Xiaoyou. You can get a wish bottle by inviting friends to light up fragments or get wish stars. After collecting 10 wish bottles, you can participate in the lottery to get HACIPUPU Ha Xiaoyou's "purchase qualification". Among them, you can get fragments by inviting a "new user member". Lighting up four fragments can get a wish bottle. Inviting old user members can only get wishing stars (you need to get 40 wishing stars to get a wishing bottle). Wishing stars will also be dropped when inviting new users. Summary: To successfully participate in the HACIPUPU lottery, Ha Xiaoyou must invite 40 new user members, and more for old users.

• Activity bait: Limited edition doll HACIPUPU Ha Xiaoyou purchase qualification
• Activity threshold: Pop Mart box machine applet registered member and "new user member"
• Activity rules: You can get fragments by inviting a "new user member". Light up four fragments to get a wishing bottle. Inviting old user members can only get wishing stars (you need to get 40 wishing stars to get a wishing bottle). Wishing stars will also be dropped when you invite new users.
• Activity path: Same as the first activity

7. Private Domain Monetization

Pop Mart’s private domain transactions mainly take place in two places: the official mall (Tmall, JD.com, and WeChat mall) and the Pop Mart box drawing machine (Tmall and WeChat mini program). Other private domain systems mainly play the role of enhancing user stickiness, stimulating users’ desire to buy boxes and draw boxes, and then completing consumption transactions in the box drawing machine and the official mall.

1. Tmall & JD store operations

(1) Tmall store operation

In addition to the membership system and new store launches, the Tmall flagship store sells blind boxes live every day, conducts daily operations within the dynamics (such as the buyer show to win a blind box event), and cooperates with Tmall's official overall activities to carry out promotions (such as the Double Eleven event).

(2) JD.com store operations

In addition to the membership system and new store launches, JD flagship store conducts daily operations within the dynamics (such as the buyer show to win blind box event) and cooperates with JD's official overall activities to carry out promotions (such as the Double Eleven event). The overall operation level is lower than that of Tmall.

2. Pop Mart community operation

(1) WeChat community

According to incomplete statistics from Pop Mart, it has nearly 30,000 communities on WeChat. Pop Mart’s WeChat community consists of three parts. 90% of the communities are established spontaneously by players. The remaining 10% are established by some store clerks to maintain customers, and another part is maintained by official community operation specialists, with traffic directed into the community through online mini-programs. The community is a small trendy toy community where users can help each other, share trendy toy information, sell second-hand goods, etc. For the die-hard fans of Pop Mart's blind boxes, exchanging, selling and buying dolls is an eternal topic.

There are multiple community entrances in the mini program (the figure below shows 4 community entrances). Information and benefits are released in the community, friends interact with each other, and activities help each other, etc. Through multiple contacts in multiple communities, your desire to draw a box is stimulated, and the transaction is completed in the online draw machine.

• Community entrance:

• Community content:

(2) JD Community

When you enter the JD store homepage, there is a clear instruction banner guiding you to join the group. The condition for joining the group is to follow the store, but the store is full of 10,000 people and you cannot enter.

(3) Tik Tok community

Both Douyin accounts have fan communities, and there are fan community entrances on the personal homepages.

4. Pop Mart box drawing machine

(1) WeChat box drawing machine

The entrance to the box-drawing machine mini program is in the personal information of the corporate WeChat account, the Pop Mart official mall mini program, the official account menu bar, and private domain communities, so that all sections on the WeChat site can be directed to the box-drawing machine.

Box extraction machine entrance:

Bubble Box Drawing Machine: The Bubble Box Drawing Machine tries its best to restore the offline box drawing process, from finding boxes/queueing for boxes, clicking boxes, shaking boxes, judging whether it is the favorite blind box, selecting, paying and other actions, which increases the fun of buying boxes online and allows users to draw boxes anytime and anywhere. Each time you shake the blind box, there will be three prompts telling you which model the blind box is not, thus eliminating 1/4 of the blind boxes to a certain extent, reducing a certain sense of blindness but still grasping the mystery of the blind box very well. With traditional e-commerce channels, you will only know what you have drawn when the blind box is delivered to you. However, with online box drawing machines, you will directly “open the blind box” after selecting the blind box and paying. If it is not the one you want, the idea of ​​“trying again” will make users quickly repurchase. According to a survey by Frost & Sullivan, 70% of users will purchase blind box toys more than three times for their favorite specific styles. In addition, the setting of free shipping for 3 blind boxes can also encourage users to make repeat purchases in order to "complete the order". At the same time, the unique display cards, prompt cards and other props of the box-drawing machine are distributed and redeemed in conjunction with the activities within the mini-program, and the gameplay and fun of online box-drawing are greatly enhanced, allowing users to continue to be "addicted" and "high".

• Box extraction process:

• Activities in the box draw machine:

(2) Tmall box drawing machine

The entrance to Tmall’s box-drawing machine is in the product category. The biggest difference between Tmall's box-drawing machine and the WeChat system's box-drawing machine is that you have to pay first to buy the number of times, and the blind boxes are distinguished by different prices. If you don't buy and go to draw directly, you will be repeatedly reminded: "You haven't paid yet."

Box extraction process:

(3) Douyin box drawing machine

Compared with WeChat and Tmall platforms, the entrance to Douyin’s bubble box machine is not obvious, and there are fewer products. When you click on the blind boxes, they all show that they are sold out. Under topics related to the Pop Mart box-drawing machine, most users discussed their experiences of drawing boxes on the WeChat mini-program. This shows that the number of users of the Pop Mart box-drawing machine on the Douyin platform is small and the level of operation is low.

5. Pop Mart’s Douyin Live Broadcast

(1) Tik Tok self-broadcast

Only the [Pop Mart Official Flagship Store] account has started live streaming, and it maintained a fixed live streaming frequency during the Double Eleven period. Previously, the live streaming was more casual. It is not ruled out that the Douyin live streaming room will become an important private domain live streaming venue for Pop Mart in the future.

[Pop Mart Official Flagship Store] The account maintained a daily live broadcast frequency during the Double Eleven period (October 27th - November 11th), with sales of 3.56w in 15 days. The best-selling product was the new blind boxes in the past two months.

(2) Expert cooperation distribution

In addition to self-broadcasting and selling products, Pop Mart also has a cooperative distribution model, but the overall sales volume is average.

8. Using the water wheel model to analyze Pop Mart’s private domain system

Water wheel model

(1) Multiple channels for traffic diversion

With tens of millions of fans across the entire network, it draws traffic from multiple channels such as official accounts, Douyin, Taobao, JD.com, offline stores, etc., increases touch points, and accumulates private domain users.

(2) Impress and create good impression

• The product IP is rich, new products are updated frequently, and the blind boxes are of high quality and feel good (compared to blind boxes of other brands).
• The game-like setting of the bubble box drawing is very addictive. The bubble box drawing machine largely restores the excitement of offline box drawing, and the addictiveness is doubled.

(3) Stimulating social fission

• Drawing blind boxes is a very game-like activity, and it carries with it the attributes of metaphysics and topics. Since ancient times, players have always had countless topics to discuss in their fight against metaphysics.
• Pop Mart’s blind boxes are better looking and better made, making them a very successful material for sharing on WeChat Moments. At the same time, many friends who love to do something with their kids take the blind boxes out to take photos, modify them for their kids, and so on, showing off their skills.

(4) Interaction leads to purchase

In the activity design, the weight of drawing a box/buying a box is relatively large to stimulate users to buy.

(5) Deepening user loyalty

Membership level system, frequent new product updates, and high product richness.

Summarize:

1. Pop Mart’s membership system is very well done, and its offline stores do not use promotional methods such as coupons to attract users, thus maintaining its brand value. Judging from Pop Mart’s member contribution rate, it has been very successful in guiding its members.
2. Overall, Pop Mart’s private domain operation system is well-established and divided into two major sections: the main battlefield for transactions (stores & box-drawing machines) and promotion and traffic diversion. It is also linked to offline stores, making it comprehensive and prioritized.
3. The design of Pop Mart's box-drawing machine perfectly recreates the offline box-drawing scene and is a great mini-program product.
4. The membership system has been extended to all main business locations, and each platform has its own characteristics.

Author: Wild Operation Community

Source: Wild Operation Community (dugu9bubai)