Chinese customs have been busy catching fake Labubus – one airport even found to up 34,000++ fake labubus. Why are the chinese customs so zealous about fake Labubus? What is driving the rise in fake Labubus and what does this mean for Popmart? In this episode, Sabrina and Jianggan unpack what’s driving the wave of fake Labubus, how resale speculation is heating up, whether Pop Mart is quietly engineering a soft landing for its hottest IP
Tune in as we explore:
- The customs raids and how officials discovered tens of thousands of fake Labubus;Why Labubu’s resale value has skyrocketed — and the risks that come with it;What a “soft landing” might look like for Pop Mart;Why Pop Mart may be taking steps to cool things down — on purpose.
Also available on Spotify and Apple podcast
(AI generated transcript)
Sabrina: [00:00:00] Hello everyone and welcome to the Impulso Podcast by Momentum Works. So today we have a special guest joining us because we are going to be be talking about, yeah, sorry, not Jianggan. Jianggan is a regular guest. We have a special guest joining us because we’ll be talking about Labubu.
Sabrina: Recently what we’ve been seeing is that Chinese customs has been cracking down on fake labubus, or as they call it, LA Fufu.
Jianggan: What happened, in June is that the customs of China has posted multiple messages on their social media platform saying that, at various locations, the customs officials are busy catching fake labu.
Jianggan: One of the posts, had an interest in title code. Oh, there are so many of them. We can’t, I mean, we tried very hard and we can, can’t catch them all. We
Sabrina: can’t catch them.
Jianggan: So
Sabrina: the Pokemon thing, so gotta catch them all.
Jianggan: So to show you guys a, a few examples, and this is the one, um, talking about customs in Dashing Airport, the second international airport in Beijing, and the officials were [00:01:00] inspecting, and, they realized that one customer had some abnormal images from the checking luggage. They opened a suitcase or suitcases and they realized that, uh, they had a HUN 952.
Sabrina: Lab Boost. Lab Boost
Jianggan: And 1,586 boxes. So, I mean, if you, if you squeeze that into one piece of luggage that’s,
Sabrina: that’s mad. I don’t think you can squeeze that in. The one also that’s quite creepy. Like imagine you look at the X-ray scanner or whatever, they use the scan.
Sabrina: That’s how,
Jianggan: that’s how Discover said, okay, this looks like abnormal. And
Sabrina: then you just see like. Like rows and rows of these little monsters in the suitcase.
Jianggan: Of course, this is all sort softer material. Right. So it’s, it’s probably squishy, not pos any, like a safety concern for aviation, but, but it will look creepy.
Sabrina: That was another one as well. Right?
Jianggan: So this ones, they discovered how many,
Sabrina: they discovered about 34,006. 620 fig ous.
Jianggan: That’s not about, that’s like a very precise number. [00:02:00] It’s a very, yeah. They must have counted, right? I mean, they
Sabrina: have to, I guess while they’re checking they have to count. Yeah, kind of. So it’s, but it’s mad. 34,000.
Sabrina: Why is the Chinese custom so adamant on catching this fake la
Jianggan: uh. I don’t know, because usually they’re not so zealous about, I mean, no. Doing this for fake foods, right? Yeah. Like kus, which are not, like branded and stuff, I guess because last few, times when some senior leadership from the government, when they talk about like. Culture export I mentioned about, so I think he has caught attention of some senior officials. And of course, I mean, sending lots of fake goods doesn’t resonate well with this sort of cultural export.
Sabrina: Mm. So I guess they’re trying to, I mean, they don’t want too many fake la
Jianggan: they probably don’t want to pay fake la, but, but at the end of the day and how much you can control, right? So, so that’s probably sending a signal and, if there’s a still, um, profit we made on producing and, uh, shipping fake labelable, people do it.
Jianggan: Hmm.
Sabrina: True. Yeah. But it’s, but it’s crazy. Right? So this shows [00:03:00] just how big Lab bbu is now that there’s such a huge counterfeit market for it. Yeah. And it’s not just a counterfeit market. There’s actually also a really big resale market for lab bbu. So obviously the core concept of popups and lab BOUs is that it’s sort of a blind box.
Sabrina: Mm-hmm. Thing, right? Mm-hmm. So there’s obviously, there’s a huge secondhand market mm-hmm. Because there’s people who would buy a bunch and then they would open it mm-hmm. And sell like specific, the specific color that you would want and all. Mm-hmm. Mm-hmm. Do you wanna guess how much the most expensive laboo was sold for?
Jianggan: Must be in the millions, right?
Sabrina: So the most expensive, um, laboo is this 131 centimeters life size. So as tall as a kid? Yeah. It’s tall as a kid, but it’s not like a soft lab. I think it’s like a, A statue. That was one of the first statue, first generations, right?
Sabrina: Yeah. It’s one of the original Soly. So truly, truly limited. It was sold, it was resold in an auction in Beijing, where for about 1.2 million r and b. So that’s about 150,000 US dollars. That’s mad.
Sabrina: I
Jianggan: see Phil shaking head because [00:04:00] she has been an avid laboo collector and she knows the prices. Yeah.
Sabrina: So it just shows that like there’s such a huge counterfeit market and of course there’s also such a huge resale market.
Jianggan: Mm. Oh this is cute. Uh, this, yeah, this is the
Sabrina: tree. Rice Laboo. It’s the monkey un. So this sold the whole set, the syn
Jianggan: novo here in no evil, right? Yeah. Yeah. Okay. The
Sabrina: whole set sold for 25,000 US dollars.
Jianggan: I mean, in the market, if there are people willing to buy, if there are people willing to sell it, then, then that’s a deal. But, uh, but I think, um, what their concern is probably if the market goes overheated.
Sabrina: Yes. So that kind of raises the question, right? Are we currently right now in our bubu bubble?
Sabrina: Because obviously as collectible. There’s a lot of hype around this lab booth, and like we said, there’s a huge secondhand market, right? Yeah. And a lot of these are resellers who are speculating on the price. Let’s say you buy this from the popup shop for $30.
Sabrina: Yeah. If I buy it and I open it, yeah. And I can tell you the specific color I can resell it for maybe. , We sell [00:05:00] for almost double the price. Mm-hmm. And of course, that’s just for these standard labelable that pop up stocks on their websites quite frequently, right?
Sabrina: Mm-hmm. So then what if we’re talking about like limited edition labelable? Mm-hmm. Like the Lifesize Labelable older versions that maybe they’ve stopped making. What’s the markup on all that? So are we in a Laboo bubble right now? Well,
Jianggan: I don’t know, but judging from the queues at the popcorn stores, judging from, I mean, how fast the, the new lab was launched, uh, get snatched, there’s probably too much attention on it.
Jianggan: Right. So, um, there’s always
Sabrina: queues.
Jianggan: Of course, people queue there for a reason. I think last year some friends from TikTok were telling me that on TikTok shop platform, , uh, BU is the only product where, um, you put.
Jianggan: So sort of the conversion rate from people viewing the product description to finally make a purchase, uh, make a payment is a hundred percent. So everybody who clicks into the product page
Sabrina: buys it,
Jianggan: ends up buying. I initially say, wow, so much interest. I think then personal reflection, I thought, I mean, there’s probably a lot of people just [00:06:00] buying for resale because a normal consumer behavior, they will not be able to be so determined to buy it.
Jianggan: Right?
Sabrina: So Pomar does do like. Timed releasers. Mm-hmm. Where a certain date, a certain time, you know they’re going to restock labu boosts on their website
Jianggan: like, like tickets and stuff, right? Yeah.
Jianggan: So obviously
Sabrina: that makes it a lot easier for these resellers to purchase ’cause they’re a lot quicker than the regular consumer who wants to buy the Labu Boost, right? I mean, this is their job is what they do for a living, so they’re quicker.
Jianggan: They’re quick because their fingers are quick or they use professional tools.
Jianggan: I think they
Sabrina: probably have like some upgrade, probably
Jianggan: optimize their network speed, helping them. Yeah. And, um, make it artificially closer to the, to the server, et cetera.
Sabrina: Yes. Like jump the queues and all. So obviously there’s a huge market of people who are speculative buying the lab boost because obviously they expect the market value to either.
Sabrina: Keep going up or to be high enough that they would always resell. Mm-hmm. Be able to resell. Right. You
Jianggan: know, university Middle NFTs. Right. We have seen, right? Yes. A few years ago, what
Sabrina: we saw with NFTs in 20 21, 20 21 20, 20 [00:07:00] 20 was hot and people were essentially buying a bunch of digital assets not to keep for their own.
Sabrina: But to sell. Mm-hmm. And of course, we’ve seen this with toys as well, right? There were like Beanie Babies. Beanie Babies Pokemon cards.
Jianggan: I have no idea what that is, but
Jianggan: you know what Pokemon cards are, right?
Sabrina: Okay. Pokemon cards, which are making a comeback. But essentially the thing that happens with all this is that eventually the bubble bursts either you overproduce too much. Yeah. And then there’s too much hype in the market and. Once you overproduce too much or I don’t know, the hype dies. Mm-hmm.
Sabrina: The value of all these toys or products just drops. Mm-hmm. To essentially nothing. Okay. And then what happens? So then the question is, what happens to all these laboo when the laboo bubble?
Jianggan: I mean, if the bubble burst, you will be stuck at someone’s hand and someone will incur a massive loss. That this is something which have been studied in, in economics for centuries, right. From the tulip, uh, mania in the Netherlands like many centuries ago. Mm-hmm. So people have been studying about that and uh, and there’s this whole sort of theory about, I mean, how do you prevent things [00:08:00] from overheating?
Jianggan: How do you sort of engineer a soft landing? And, um, because otherwise you will see a crash. And I think from pop mind as company, they care about it. There’s a lot, right? Because if LA eventually crashes. And that’s going to hurt the company big time because first, all these people’s confidence about, I mean, the value of the, of IT products, the products that you’re buying will crash.
Jianggan: I mean, you, you would rather, I mean, as a company, you would rather. Just like any economy, right? You would rather everything to have a healthy, slow, gradual appreciation so that whoever who holds it would have some, uh, earning, but, uh, you don’t want to need to be a situation that, uh, the price actually goes astronomically and suddenly come all the way across, crashing down because it’s, it’s pretty hard to recover from that.
Sabrina: Yes. And I would think as a company you wouldn’t want. The price to suddenly just dip. ’cause I mean, pop itself is also a publicly listed company. Yes. So this definitely would, and the stock
Jianggan: price like grew like 13% over the last like eight month or something. Yeah. ‘
Sabrina: cause of Laboo.
Jianggan: And if the company’s, um, management [00:09:00] is in a mindset of, okay, I, I want get rich quick. I want to sort of grab the money and stuff. I don’t care about consequences. They’re probably just profit from that. I mean, selling the stocks and stuff, pump and dump, right? So yeah, I was like, actually something someone is familiar with, but scared of
me.
Sabrina: Yeah. I just earn my money and then I would dip when I have to dip, find out business.
Jianggan: But of course I think Pop Mart at least the founder, he’s ambitious and he’s also very determined, so. So he will probably not want to see the situation. He will probably wants to build a company that will last for, I don’t know, a century or something.
Jianggan: So if that’s the guiding mindset and, and I think the problem would take some actions to actually engineer a soft landing of the lab mania.
Sabrina: How do you engineer a soft lending?
Jianggan: So for instance, uh, a few weeks ago when the, the, the price became very hot and what they did is that they suddenly restocked.
Sabrina: Oh, lab was on that lab, on their
Jianggan: website. So, so, so of course it’s, it’s, it’s not as simple as just, I, I put, put additional stock, right? So for all the resellers who bought it, hoping to [00:10:00] sell, and then suddenly they realize that, okay, there’s enough stock. They, they, I can’t really resell at, at it at a massively higher price.
Sabrina: Trying to encourage people to, people who actually want to buy the lab, boo boo, for themselves to buy it from official websites rather than the secondhand market.
Jianggan: And also you need to hurt resellers in a way. So that the sort of speculation sort of, I mean, not necessarily ties down, but ssis
Sabrina: that’s a little less.
Sabrina: Speculation. ’cause that’s a lot of, that’s probably a lot of speculation now. Yes. When people are buying to like stock up on the lab boost.
Jianggan: Yes. Yes. And it’s not healthy, right? So if you stock up too much and uh, when it comes crushed on, I think your interest in Pop Marta will probably just die. Yes.
Sabrina: This current interest is mostly Labu boost.
Sabrina: Mm-hmm. But Pop Mart itself also has a lot of other ips mm-hmm. That are not just currently not as hot as Laboo, right? Mm-hmm. Mm-hmm. So. Should they as a company try to be pushing out these other ips as well? They
Jianggan: are pushing out other ips and, uh, I think, I think maybe a similar energy is something we’re familiar with live commerce, right?
Jianggan: I mean, you don’t want [00:11:00] somebody to be super, super successful than when they coming crash down ’cause of whatever incident. Yes. You’d rather create a, a consortium or moderately successful ips or, or live hosts or whatever, right? And uh, all stars. And one of them is more successful than others, that’s fine.
Jianggan: But you don’t want a situation that’s highly volatile because that’s, that’s bad for a business planning that’s bad for long term, and that creates lots of concentration risk.
Sabrina: Then you only have one and then it drops. Yeah.
Jianggan: And, founder of a pop mart, and before it became super, super famous, uh, heat.
Jianggan: Actually did lots of interviews. I mean, lots of them are actually published, um, in video format, in Chinese social media platforms. You can see the role side of him. So, which is actually pretty impressive. There was one interview where he was asked, Hey, um, so, so your products, uh, I think back then was Molly, right?
Jianggan: Only Molly. It was so hard. Why can’t you, I mean, just raise more capital and go and open like 500 stores more? Uh uh, sorry. It’s 500 stores, stores, uh, 1000 stores, [00:12:00] 3000 stores. Because at that time, um, pop Martin had 100 stores, hundred stores. And the founder’s, one response was that, okay, the capabilities of our organization only allows us to have, um, 100 stores.
Jianggan: And beyond that, I don’t think we can handle effectively. Mm.
Sabrina: So he has very good like. This is not really long term foresight, but he focuses more on being able to grow the company at a very sustainable rate. Yes, yes. Rather than just growing because,
Jianggan: because we’re external investor wants you to grow and, uh, not caring about consequences afterwards.
Jianggan: Yeah. I think he’s, uh, he’s the pretty true business person, so
Sabrina: it’s not just like taking money and then growing and then if it crashes, like it crashes. He’s thinking about sustainable. So that’s probably why I would say popup would be engineering a soft landing. Yes. For laboo. Yes. So they wouldn’t want to.
Jianggan: I think, I think from their point of view, they probably think that whether pop mart, the, the market cap is overvalued or not. Mm-hmm. That’s a, that’s, that’s a separate question, but they probably think that the way that the prices of pop mart as a stock, the [00:13:00] price of lable the way has gone up and is certainly not a sustainable and healthy way.
Jianggan: So they need to moderate that a a bit,
Sabrina: but it takes quite a lot of foresight for a leader to be able to make this decision, especially when you see the fact that one of your products. Selling so well, I mean, you could just capitalize on it.
Jianggan: I mean, it’s not foresight per se. I think anybody who managed to build a successful business would know that in theory.
Jianggan: But when the temptation is there, yeah. It’s like, would you be, would you be able to sort of resist the temptation? Resist the temptation, yeah.
Sabrina: Yeah. Because what’s stopping them from just like,
Jianggan: like getting some quick profit, right? Getting
Sabrina: a bunch of, selling a bunch of labu boos, earning the money, and then.
Sabrina: Just letting it crash and die and move on to something else. Yeah.
Jianggan: I think truly great leaders know how to delay the gratification,
Sabrina: self-control.
Sabrina: So hopefully we wouldn’t see the Laboo bubble burst anytime soon.
Jianggan: I hope it doesn’t burst. I hope that, uh, that I continue to see like innovative IP is coming from the company, that
Sabrina: maybe the heat will die down a bit, but then it would be like a little more sustainable growth. [00:14:00] Right? So thank you guys for tuning into another episode of the Impulsive Podcast. We hope that you guys enjoyed today’s episode, and if you did or if you are curious to hear us talk a little bit about Pot Mat, we do have two other episodes that will be linked down in the show notes below.
Sabrina: If you enjoyed this video, do. Give us a thumbs up and subscribe to stay up to date on the latest happenings in trends in tech, new retail, and the broader digital economy. Thank you, and bye-bye.
Jianggan: Bye-bye.
Bye-bye.
The post Is POPMart engineering a soft landing for Labubu? | Impulso E127 first appeared on The Low Down - Momentum Works.
