Recently, there is a company worth studying that is listed on the Hong Kong Stock Exchange.
This company is Deying Holdings, which was listed on January 17.
On the day of listing, Deying Holdings opened at HK$2.6/share, up more than 30% at one point, with a total market value of more than HK$2.7 billion.
Many people have not heard of this company, but many people have an impression of the company's products.
Deying Holdings is the parent company of B. Duck.
In various products such as clothing, we can see the image of this little yellow duck.
The birth of this little yellow duck stemmed from a hot news.
In 1992, a freighter carrying nearly 30,000 rubber ducks sailed to Washington State when it encountered a severe storm in the Pacific Ocean.
The container was broken, and countless small yellow ducks were scattered on the sea, so this "duck fleet" began to drift around the world.
After 15 years, the duck fleet drifted 35,000 kilometers, leaving trails on the coast of many countries, and finally arrived on the coast of the United Kingdom in 2007, ending the journey.
During this period, this "duck fleet" that has been drifting at sea for more than 10 years has been reported by many media and has repeatedly become hot news.
As a synonym for bravery, Little Yellow Duck has circled a wave of fans around the world and become a household name "Internet celebrity".
In 2005, Hui Xialin, a Hong Kong designer studying in Europe, saw the news of the little yellow duck.
Xu Xialin found that in the entire industrial chain of little yellow duck, China's production factories can only earn a few cents in processing fees.
European sellers, on the other hand, can earn dozens of times the high spread.
How can we enhance the value of the industrial chain?
As a designer, Xu Xialin thought of the brand.
So he came up with an idea: to create an image of a duckling that belongs to Chinese.
At that time, Xu Xialin's son was born, and he was planning to design a bathtub toy for his son.
Inspired by the "Duck Fleet", Xu Xialin designed an anthropomorphic cartoon little yellow duck.
Based on this image, Xu Xialin created a series of bathroom-themed products.
The first waterproof little yellow duck radio in the bathroom was a global hit as soon as it was launched.
Xu Xialin named it "Bathing Duck" and has since had the B. Duck brand.
Subsequently, Xu Xialin established Deying Holdings and opened a toy factory to manufacture B. Duck and carry out retail business.
In 2010, Deying Holdings officially launched the licensing business, and since 2011, it has authorized third parties to use the role of B. Duck as a consumer product and for promotional purposes.
Now Deying Holdings carries out two directions of operation around the original IP of Little Yellow Duck.
The first is to develop a series of peripheral derivative products, find foundries for processing, and sell through online e-commerce and offline channels.
The company began to have clothing stores in Hong Kong, Beijing, Shanghai, Shenzhen.
There are online stores on e-commerce platforms such as Tmall, JD.com, and Vipshop.
The second is to carry out licensing business, licensing the little yellow duck and the IP role of the "B. Duck family" to earn copyright fees.
Little Yellow Duck authorized the children's clothing brand, basically charging 5% of the trademark licensing fee, and the deposit was about 100,000-200,000 yuan.
As of June 2021, 346 licensees have established partnerships with them.
The company now has more than 20,000 SKUs at home and abroad.
The licensed products are distributed in China, Thailand, South Korea and Malaysia, and have accumulated a large number of fans for the Little Yellow Duck IP.
In terms of revenue, according to the prospectus, the revenue of Deying Holdings between 2018 and 2021 H1 was HK$201 million, HK$243 million, HK$234 million and HK$124 million respectively;
Net profit for the same period was HK$13.974 million, HK$32.856 million, HK$59.836 million and HK$25.606 million, respectively.
In fiscal 2021, the revenue of IP licensing business accounted for 47.6%, which was nearly the same as the self-sales of peripheral products.
The revenue of the company's IP licensing business has continued to rise over the years, behind which is the huge potential of the IP licensing business.
The company that does the best in this direction is Disney, which sits on a variety of well-known IP and makes a lot of money through derivatives and licensing businesses.
After little yellow duck became popular, Deying Holdings continued to introduce new IPs for rich roles.
At present, Deying Holdings has 26 original roles.
However, except for Little Yellow Duck, the licensing business of other characters is not smooth.
At present, the company's licensing business, the little yellow duck accounts for nearly 74%.
Today, Little Yellow Duck has grown into one of the top intellectual property (IP) companies in China.
But it still has a lot of room for development.
After the listing of Deying Holdings, it has more funds, which may allow its other IP to develop faster.
Brand licensing is now a fast-growing, high-profile business.
According to the "2021 White Paper on the Development of China's Brand Licensing Industry", the annual retail sales of licensed goods in mainland China reached 110.6 billion yuan in 2020, an increase of 11.5% year-on-year, and the number of IPs Chinese mainland to carry out licensing business exceeded the US market for the first time.
Building AN IP is not easy, it's like going from 0 to 1 and requires a lot of time and resources.
However, once the IP is built, it can quickly go from 1 to N through authorization, becoming a good business that makes money lying down.
The listing of Deying Holdings may provide some reference experience for other companies that build IP.
I predict that there will be more and more original and well-known IP in China in the future.
With the strength of China's national strength, there will be many world-renowned IP in this.
For entrepreneurs, this is both a trend and an opportunity.