Image source @ Visual China
Text | Play generations
Under the epidemic, Lego has made a lot of money. Lego released its 2021 financial report, with annual revenue of more than 52.2 billion yuan (DKK 55.3 billion) and annual net profit of 12.38 billion yuan. On the annual revenue, it is almost half of Moutai (106.19 billion) and one Wuliangye (66.2 billion).
Also eye-catching is lego's growth rate. Compared to 2020, Lego's full-year revenue increased by 27% and retail sales increased by 22% year-on-year.
China became a fragrant bounty, driving the Asia-Pacific market to soar, with sales up 26% year-on-year.
The building block market has attracted the eyes of tide play retailers, and has been named one of the categories of collectible toys, and channels such as cool tide play, tomato pocket, X11 and other channels have freed up shelves for building blocks. TOP TOY, a chao play collection brand under Mingchuang Premium, personally went down and quietly registered Hangzhou Huabao Brick Culture Development Co., Ltd. in February this year.
Capital has also projected its attention to the building block category, and Sequoia, Alibaba, Little Red Book, Shunwei Capital, Toutou Dao Fund, Honghui Capital, etc. have invested in the past year.
In May 2021, the children's building block brand Bruke received 600 million series B financing from investors such as Yunfeng Fund and Legend Capital. From 2018 to the present, it has accumulated six financings.
In December 2020, Pinqi completed the Pre-A round of financing, and the investors were Zhen Fund and Sequoia China Seed Fund. In February 2021, the A round of financing was completed, and the investors were Shunwei Capital and Lightspeed China.
In December 2021, Little Red Book invested in coincidence bricks dedicated to the development of Chinese-style building blocks.
In February 2022, Senbao Building Blocks completed a series A financing of hundreds of millions of yuan, and the investors were Alibaba, Toutou Dao Fund and Honghui Capital.
The building block track has suddenly heated up, but in the eyes of many people in the industry, building blocks are not a new outlet.
Building blocks are a century-old "old market", it is not as cutting-edge as the tide play, has long entered a stable cycle. In 2020, the domestic market of mainland toys increased by only 2.6% year-on-year.
In such an environment, "Big Brother" Lego is as stable as Taishan, and step by step to force the Chinese market. In the past few years, LEGO has pressed the Chinese market, and new retail stores in China account for more than half (up to 90). Lego accounted for 69% of the market in 2020, and Lego's market share in the Chinese construction toy market reached 42.3%.
A common consumer perspective is that there are only Lego and "other brands" on the market. These "others" divide the market surplus, it is difficult to distinguish between them, and the mainstream is still sinking in K12. But the children's toy market is not optimistic.
Parents urge marriage, give birth, and the state opens up the three-child policy. According to the National Bureau of Statistics, the national birth population in 2021 was 10.62 million, and the birth rate was 7.52 ‰, which declined for five consecutive years, compared with 17.86 million in 2016, 40% less.
Fewer children, that is, less users, although the real money is the parents, they have better consumption power and stronger willingness to consume, but after the "homework", how much time is playing with toys, and how many opportunities can be allocated to the building blocks? The harshness of the market is obvious.
Perhaps what building block brands expect most is to take the express train of trendy toys, blow the east wind of collecting toys, and come to a "spring breeze and the south bank of the Green River".
In 2018, Senbao Brick proposed the transformation of the whole age segment, and the enlightenment of the 2019 registered independent brand keepplay, setting the tone of "trend building blocks"; Pinqi was the first to start "collecting blocks"; LOZ Lizhi mainly focused on small particles hot sales...
Admittedly, strong spending power and the endless emergence of new channels give brands more opportunities. But selling toys to adults is not as simple as the "all-age segment" of the product.
Little Red Book Blogger Photo - Domestic Building Block Flower
Tide play up blocks down
In the past year, the wind of national brand building blocks has been blown on the Little Red Book. #国产积木 The number of topics exceeded 44 million, and the number of notes related to domestic building blocks exceeded 30,000.
Young girls began to use building blocks to arrange flowers, "raise" succulent pots, and place dolls in brick rooms, and "immersive building blocks" have also become a tributary of the Lifestyle of Little Red Book users.
Domestic building blocks are impressing a new generation of young people. Xiaohongshu disclosed that among the 200 million monthly active users, 72% are post-90s, and 50% are distributed in first- and second-tier cities, with a ratio of male and female users to 3:7.
Since about six or seven years ago, the brand has turned its attention to young people. The products are the most prominent variations, such as light-sensitive discoloration, lighting, voice control, movability and intelligence, which are different from Lego in terms of fun and entertainment.
Pinqi is the first brand to launch a "collection of building blocks", although it was only 2 years old, it hit the market with explosive items. Last year's Double Eleven, the 70th anniversary commemorative building blocks produced by Pinqi sold 10,000 sets in the pre-sale. The design of the half-human, half-mech, the massive silver-sprayed bricks, and the movable shapes hit the young people.
Netizens ran to social media to act as tap water, praising its "domestic building ceiling". But good word of mouth soon suffered a "rollover". Some players pointed out that the manufacturer increased the price with the trend, 299 yuan pre-sale, to the Sam's Club store more than 400 yuan sold out, and then to the cat flagship store today 599 yuan (coupon discount to the hand price of 499). The premium is only a few months away. Critical voices followed.
After playing the explosive single product, it is more or less accompanied by price increases. There are dealer rumors that some hot-selling series have revealed price increase signals, and the price increase range is 20 to 30%.
This may reveal the desire of domestic producers - to build a brand and get out of the cost performance.
But the reality is that what really impresses young people is still the "price is really fragrant". On the notes of the Little Red Book, "50 yuan hi play", "99 pieces all won", "low-cost wumei" is a treasure, netizens directly called "domestic building blocks to achieve building blocks freedom".
Little Red Book blogger posted a picture
For example, the LOZ tree house is priced at 600 yuan for 6,000 bricks, and the price of the benchmark Lego tree house is about 1200 yuan, and the price is doubled and the amount of bricks is half. High-priced products are also like "Juhuasuan".
A large number of brands follow the LEGO flat route, looking for a balance of "quantity and price" in the sensitive belt of consumers.
According to the observation of a certain building block product, from the promotion price of the event to the restoration of the original price, the sales volume fell significantly, and some people immediately switched to Pinduoduo, 1688, and even idle fish, looking for a lower price, and the gap was only two yuan.
At this stage, it is difficult for building blocks to become @BEARBRICK. Some retailers pointed out that building blocks are an extremely price-sensitive category, and domestic building blocks attract young users who are just getting started. They like bricks, but le noble, buying a flat is a definite market demand.
Domestic building blocks are trapped in the cost performance, but the tide players next door are rising all the way. The price of the mass-level blind box is rising, and the unit price of the MEGA series of high-end treasure lines is not cheap, but it does not affect the market performance at all, and it is relatively valuable in the circulation market. Bubble Mart's 2021 financial report disclosed that the MEGA series of products generated 178 million yuan in revenue. Company executives pointed out on the earnings call that "(MEGA series) will grow several times this year compared with last year."
And Lego has made toys into "plastic gold bricks", generally a toy will enter the value-added period within 2-3 years after delisting, becoming a delicacy in the secondary market. It is not only an adult collector's level, but also has a financial attribute to a certain extent.
According to a study in the journal International Business and Finance Research, the market price of Lego toys in the secondary market is growing by at least 11% per year, which is higher than the average return on gold, large company stocks, bonds and other investment methods.
The reason for the difference lies in the difference in the underlying logic. "In the past, most brands were selling goods, spreading channels, using multi-SKU and multi-channel to make GMV logic, and the ultimate pursuit of product strength is not the way to maximize economic benefits", Tango, partner of Pinqi Products, pointed out, "Lego has a 90-year development history, brand value, understanding of product strength, accumulated supply chain product standards and operational capabilities, is the gap lacking in national brands." ”
Domestic products are hovering in the low price band, the brand's right to speak on product pricing is declining, and it is difficult to call the brand without a premium.
The national card creates the freedom of building blocks, who will give the national card freedom?
The dilemma of domestic building blocks blindly selling cheap has emerged. The brand side also expects to find its own right to speak, and the mortise is a breakthrough from the underlying logic of building.
Shan Jixiang of the Palace Museum said in an interview that "mortise and mortise are the real Chinese building blocks." "The essence of Chinese building blocks originates from Chinese architecture", the tenon and tenon structure, which originated from 7,000 years ago, is the spiritual inheritance of Chinese craft culture.
The market also appeared the main tenon concept of building blocks products, "insert, slip, card, buckle" full of national flavor. But in fact, mortise and mortise can burn feelings, but can not burn market sales.
On the Internet, there are tenon and tenon building block entrepreneurs to confide in the truth, the cumulative investment of 20 million, the annual revenue of 10 million, the most bitter time to sell houses and cars has been "Gou" until the media reported to open the sales situation.
Compared with the big adventure, most brands follow lego's IP path, blindfolded and running wild on the original.
In terms of IP cooperation, Senbao has locked the film, television, military, and museum IP, and won high-quality IP such as the three-body, the wandering earth, and the Forbidden City, as well as exclusive resources such as Shandong ship, aerospace cultural creation, and aviation cultural creation. Currently launched the tide play side line AreaX.
KeepPlay has made Japanese IP such as Pokémon, Sanrio, and Crayon Shin shin a bestseller. Previously, Pinqi has announced the joint name with "Astro Boy", the national comic "Spirit Cage", "Sherlock Holmes", and Xiaopeng Motors, and recently launched a global exclusive licensing product with "Wulin Waichuan".
There are also people who have set their sights on Chinese classical architecture. For example, Xiao Luban's Xiange Sacred Building series adopted Guanghan Palace and Penglai Xiange. Even public copyrights such as world famous paintings and masterpieces have not been spared.
Some domestic building blocks Small Red Book tag statistics
The brand's calculation is to use the power of IP to hit the fan circle. However, a variety of IP co-branding and original designs flock to the market, and the random flowers are gradually becoming attractive. Some players pointed out that "in the past two years, I feel that the building block manufacturers have become more and more rolled, and I feel that everyone is trying to buy new products and produce new products", "but the homogenization is very serious, and there is a bit of visual fatigue.".
In fact, Lego has monopolized a large number of top IP, "the well-known IP on the market has been signed by Lego, and it is the exclusive copyright", including Disney, Marvel and other world-renowned copyrights.
Screening IP for re-creation within the remaining limited range is tantamount to dancing in shackles, and "there are 120 building block manufacturers in Chenghai, and good IP will also choose good manufacturers."
Blindness and misjudgment of IP are sometimes drawn as prisons. Lin Zezhe, co-founder of Senbao, pointed out that "there is no good concept, only genuine authorization, and still cannot pull out the brand height." Senbao has also stepped on the authorization of the movie "Shanghai Fortress" and "Detective Chinatown 3". "It's one thing for audiences to like to watch this movie, it's another thing for them to be willing to buy a product," the brand tasted sweet and sour when it came to spending money to smash the rights.
The atmosphere of the building block circle to follow the trend is no less than the raw coconut latte in the coffee industry, the duck feces fragrance of the milk tea industry, the retro series and the Hong Kong wind series emerge in an endless stream, the street view series of large and small sizes take off in the sky, and the hamburger car and milk tea car building blocks are not uncommon. And the competitor shot is a "lower price" dimensionality reduction blow.
Just after the strange Astro Boy was on fire, some imitators had already started the game of "skinning". More and more manufacturers are fighting internally, and they are connected to the same volume, and no one can escape the depths of the water.
Tango, a partner of Pinqi Products, said, "From the first day of its establishment, Pinqi has strongly opposed any piracy, plagiarism and edge-scraping behavior", "We must rely on a sharper sense of smell, look at consumer demand with a perspective five years earlier than the market, dare to innovate, and make products that are not on the market.". Pinqi uses explosive products to impress users, supplemented by content marketing to influence users' minds and build brand awareness. Since last year, this strategy has begun to bear fruit.
Senbao is also re-examining the definition of trendy products and using the strategy of fast and slow to conquer the market. Lin Zezhe said that after finding the breakthrough highlights, it is more necessary to test the maintenance speed of the brand, how to maintain the brand highlights, and then supplemented by a reasonable channel sales layout. Last year, There were 200-300 original products of Senbao, of which The Wandering Earth was the hottest product of the year.
Little Red Book Blogger Sun map - Senbao Wandering Earth
Next Lego? Get it wrong, start over!
In the face of post-95s and post-00s consumers who pay attention to consumption upgrading, the past business ideas are doomed to fail.
Analysys analysis of the "China Collectible Toys Industry Market Insight Report 2021" shows that as of 2025, the market size of the domestic collectible toy industry will exceed 150 billion yuan, the core consumer group will exceed 100 million people, and the overall growth rate of China's collectible toy market will be as high as 35%.
Building blocks are also the largest category in the traditional toy market. In 2020, the national toy retail scale reached 77.97 billion yuan, and the toys with patchwork blocks accounted for 16.2%, ranking first among all categories.
From toys to collection, the first thing to say is, what is the value of collection? The definition of collectible has not yet been found.
Pinqi user survey shows that the current age of Pinqi users is concentrated in 25-35 years old, they are exquisite white-collar workers and middle class, the pursuit of decompression, self-entertainment feelings; willing to spend time, enjoy the building experience, show the process of sharing. They often have higher requirements for the state and quality of life, pursue beauty, and pursue the ultimate.
Building block players pursue feelings, and have clearer demand standards for aesthetic power, self-pleasing, and empathy. According to Xiaohongshu observation, young players are sensitive and sensitive, they have judgment on details such as oversaturated color matching, glossiness of bricks, design flaws, etc., but they are also willing to tolerate "small imperfections" in the building process.
The new generation has a wider vision and more critical taste, and fundamentally the logic of the market has changed. First impressed this group of people, to a certain extent, to achieve the trend, reached the collector's level.
Pinqi is also trying to switch the user's perspective, selecting IP that can better represent the Chinese preferences and memories in the choice of cooperative IP, exploring the standard of collectible building blocks, and building the brand's product strength. At the same time, embracing the social media platform and listening directly to the voice of users through the private domain, Pinqi is looking for the best way to interact with the market in its own way.
Senbao also expects to shift from dealer brands to user brands. Lin Zezhe revealed that the company set up a branch in Hangzhou this year to force e-commerce operations, cooperate with tide play retail channels, and launch tide play joint names. At present, the young group of 18-32 years old accounts for about 15-20% of the overall size.
In the past, domestic producers wanted to sword at Lego, trying to make up for the shortcomings of brand power with cost performance, using edge IP to counter Lego's IP accumulation, and using immature technical production standard capabilities to compete with Lego's decades-old production management system, which is a fallacy in itself.
What domestic building blocks really need is a reshaping of business logic, a brand war of curve overtaking, just as Luckin is to Starbucks, yuanqi forest is to Coke.
Instead of fishing on the LEGO route, it might be better to look at the Bubble Mart next door and look for the "Stone of His Mountain":
Read what young users are thinking, clarify and convey the brand value proposition. Not IP for IP's sake.
Effective user communication channels. The distribution network can not replace the brand private domain, look at the financial growth data of Bubble Mart, anti-risk ability.
Stable aesthetic output, serial product logic, find product definition intervals.
"Every market deserves to be reworked", and perhaps domestic building blocks should also re-examine the road under their feet.