How Labubu Turned Pop Mart Into a $1.8 Billion Toy Powerhouse

How did a mischievous, fluffy creature with sharp teeth come to outperform toy giants like Mattel, Hasbro, and Sanrio combined? Meet Labubu, a soft vinyl figure turned cultural icon, who’s redefining what it means to be a viral product in the 21st century. In an age where attention is the most valuable currency, Labubu shows that sometimes the smallest toys create the loudest noise.

The Labubu Phenomenon: From Zero to Billions

Labubu’s rise is a textbook example of the “overnight success that took a decade.” Created in 2015 by Hong Kong-born, Netherlands-raised artist Kasing Lung, Labubu was initially a side character in Lung’s illustrated series The Monsters, a collection inspired by Nordic folklore. Though not the original protagonist, Labubu’s elf-like charm and chaotic-cute energy stood out, eventually becoming the breakout star.

In 2019, Pop Mart, China’s leading designer toy company, signed a licensing deal with Lung to bring Labubu and his monster friends into the world of collectible toys. Yet, for years, Labubu remained a niche favorite in East Asian art toy circles.

Everything changed in April 2024, when BLACKPINK’s Lisa, one of the most globally followed K-pop stars, was spotted carrying a Labubu keychain. Almost overnight, TikTok searches surged, fans scrambled to find similar merch, and Southeast Asia became ground zero for a Labubu craze.

According to The Economic Times, Pop Mart’s annual revenue doubled in 2024 to 13.04 billion yuan (approximately $1.8 billion USD). Plush toys—led by Labubu—drove a 1,200% surge in plush category sales. This segment alone made up 22% of the company’s total revenue.

Reinforcing this meteoric rise, a Voronoi visual market analysis revealed that Pop Mart experienced a 165% revenue increase in Q1 2025, propelling its market valuation to around $34 billion. That figure surpasses the combined value of toy giants Mattel, Hasbro, and Sanrio.

Why Labubu Feels Like a Recession-Proof Companion

Labubu’s explosive rise isn’t just the product of clever design or celebrity influence. It’s a mirror of the psychological and economic pressures shaping how people spend today, especially during times of uncertainty.

One key concept that helps explain its popularity is the “lipstick effect.” It’s a term coined by Leonard Lauder, chairman of Estée Lauder, during the early 2000s recession. Lauder observed that in economic downturns, consumers tend to cut back on major luxury purchases but increase spending on small indulgences—like lipstick—that offer a sense of emotional comfort and control. It’s a form of accessible luxury. When the $2,000 designer bag feels out of reach, a $25 lipstick (or in 2025, a Labubu keychain) provides a quick, affordable dopamine hit.

Today’s economic climate, characterized by inflation, stagnant wages, a challenging job market, housing instability, and an uncertain political situation, has given rise to a new spending behavior. Consumers, particularly Gen Z and younger millennials, are striving to strike a balance between financial prudence and emotional needs. Labubu sits perfectly at this intersection: priced between $20 and $300, it offers a sense of joy and collectibility without financial guilt. Thus, Labubu isn’t just a toy, but it’s a coping mechanism. 

Parasocial Comfort & Symbolic Companionship

Periods of economic strain often parallel social fragmentation, especially in hyper-urbanized, digitally saturated societies. During the pandemic, Nintendo’s Animal Crossing became a lifeline for millions—offering symbolic companionship, comforting rituals, and a sense of control. In today’s similarly fragile cultural climate, Labubu’s rise feels less like a fleeting toy trend and more like an emotional adaptation.

What emerges from this is not just a fad but a micro-culture: complete with fandoms, trade markets, unboxing rituals, aesthetic styling, and online discourse. It’s the same emotional architecture that built global icons like Pokémon or Hello Kitty. It’s what Haley Bieber did with Rhode—where a simple beauty product becomes an emotional artifact wrapped in branding, community, and desire. Labubu is following this blueprint. 

Blind Boxes: Legalized Dopamine Hits

This is where Labubu, and Pop Mart more broadly, shifts from simple collectible to psychological goldmine: the blind box model. 

It’s not just about buying a toy anymore. It’s an interactive retail experience where customers aren’t just purchasing objects. They’re engaging in a mini-game of chance that delivers emotional payoffs with every unboxing. It’s gamified consumption.

Each blind box offers a mystery figure from a known series. You might get a common one, or you might score the ultra-rare “secret edition”. But Pop Mart didn’t stop there. It designed a system that’s inherently filmable. The thrill of the unboxing, the possibility of scoring the rare one, the disappointment or delight—all of it plays perfectly on camera. That’s why TikTok has over 1.4 million #Labubu posts and counting: every buyer becomes a micro-influencer, generating content, reactions, trades, and free marketing for a multibillion-dollar brand.

This dynamic has created not just consumers but content loops. People don’t just buy the toys. They document the experience, share it, and then chase the feeling again. It’s commerce, content, and community, all packed into a 3-inch vinyl box.

What’s Next? Could Labubu Become the Pokémon?

If current trends continue, Labubu has the potential to evolve into a cultural powerhouse like Pokémon, cultivating a multi-generational fandom through expansive merchandising, media, and collaborations. However, the market is fast-moving. Trends can skyrocket but just as easily fizzle out due to shifting consumer tastes, regulatory changes, and fierce competition.

Thus, the question is: Can Labubu maintain its momentum and transform from a viral sensation into a timeless cultural icon?