Okay, so you saw it once, and then suddenly it’s everywhere. This unusual, somewhat grim character has captured the hearts and wallets of consumers worldwide. Meet Labubu, which has become a global phenomenon and a masterclass in understanding consumer psychology.
Since 2017, these peculiar monsters created by Hong Kong artist Kasing Lung Wang Ning have achieved new milestones, with last year’s revenue exceeding $415.2 million, a 726.6% increase compared to the previous year, noted by Pop Mart’s chairman and CEO in its 2024 annual report. What makes this story remarkable isn’t just the numbers, it’s that Labubu defies every conventional marketing rule about what should appeal to mainstream consumers.
The Rise of an Unexpected Icon “Labubu”
Labubu achieved massive popularity with minimal traditional marketing. Instead, it spread through social media shares, collector communities, and word-of-mouth, creating the kind of organic growth that marketing executives dream about. According to research from GlobalWebIndex, products that generate high social sharing can see up to 4x greater engagement rates than those relying on traditional marketing channels alone, with collectibles being among the highest-performing categories for social media amplification.
The Market Research Lessons Hidden Within
The Labubu phenomenon offers several insights that market researchers should be studying:
1. The Power of Counter-Positioning
Labubu’s success demonstrates the value of “going against the grain“. In a market dominated by conventionally cute characters, Labubu’s slightly unsettling appearance created a distinctive identity. Market research that only follows established patterns might miss these opportunities for disruption.
Research published in the Journal of Consumer Research by Berger and Heath (2007) confirms this psychology, noting that “consumers often diverge from majorities to ensure that they communicate desired identities and avoid sending undesired identity signals.” This phenomenon, known as “divergence,” helps explain why unconventional products like Labubu can thrive despite breaking traditional aesthetic rules.
2. Community as a Growth Engine
Traditional market research might have focused on individual consumer preferences, but Labubu’s success highlights the importance of understanding community dynamics. Collectors share their purchases on social media, creating a sense of belonging and driving FOMO (fear of missing out) among others.
A 2023 McKinsey report on consumer trends found that 63% of successful product launches leverage community engagement strategies, with those emphasizing community building showing 28% higher customer retention rates than those focusing solely on product features. The report specifically noted that “collecting communities” represent one of the strongest forms of brand loyalty across markets.
Dr. Robert Kozinets, a leading expert in netnography and consumer culture at the University of Southern California, has documented this phenomenon in his research: “Communities of consumption don’t just purchase products, they co-create meaning and value. Smart brands recognize they’re not just selling to individuals but to interconnected social networks where influence flows multidirectionally.“
3. The Emotional Value Proposition
Many have been asking themselves “Why are people paying premium prices for small vinyl figures or plush toys?”. Well, we can answer that by understanding the emotional rather than functional benefits, a dimension that superficial market research often misses.
Labubu collectibles aren’t purchased for utility. They satisfy deeper emotional needs: self-expression, the thrill of collecting, and participation in something distinctive. Market researchers who dig beneath surface-level preferences to understand these emotional drivers gain invaluable insights.
Research published in the Journal of Marketing by Thomson, MacInnis, and Park (2005) developed a scale for measuring emotional attachment to brands and found that strong emotional connections were better predictors of consumer commitment and price tolerance than satisfaction metrics. More recent research by Fetscherin and Heinrich (2015) in the Psychology & Marketing journal found that consumers with strong emotional bonds to brands were willing to pay price premiums of up to 40% compared to alternatives.
From Insights to Market Success
The brands that have partnered successfully with Labubu didn’t stumble upon this opportunity by accident. They leveraged sophisticated consumer insights to identify and capitalize on this trend:
- Sentiment analysis of social media conversations revealed growing interest in aesthetics that blend cute and creepy elements, what researchers call “creepycute.”
- Ethnographic research into collector communities highlighted the social currency attached to unique, limited-edition items.
- Trend forecasting identified the growing appetite for products that offer an antidote to the perfectionism of Instagram aesthetics.
These research approaches have yielded impressive results across the designer toy industry. According to a 2023 report by The NPD Group, the designer toy segment grew by 26% YoY, significantly outpacing the 3.7% growth of the traditional toy market. Limited-edition collectibles like Labubu represent a particularly high-growth subsegment, with secondary market values often reaching 300-500% of retail prices for rare editions.
The Warning for Traditional Research Methods
The Labubu takeover showcases the limitations of traditional market research methods. Focus groups likely would have rejected the character as too strange. Surveys asking consumers what they want might never have uncovered the appeal of a sharp-toothed monster.
Harvard Business School professor Gerald Zaltman, in his influential book “How Customers Think,” estimates that 95% of consumer decision-making occurs in the subconscious mind, an area traditional research methods struggle to access. His Zaltman Metaphor Elicitation Technique (ZMET) demonstrates that deeper research methodologies are needed to tap into the emotional and subconscious drivers of consumer behavior.
“Traditional approaches often only capture what consumers think they should want, not what will actually delight them,” explains Martin Lindstrom, renowned branding expert and author of “Small Data: The Tiny Clues That Uncover Huge Trends.” In his research, Lindstrom has demonstrated that consumer articulations often contradict their actual preferences, particularly for novel or unconventional products.
Beyond the Trend: Creating Lasting Impact
For companies seeking to leverage insights from the likes of Labubu, the key here is to distinguish between the specific trend and the underlying consumer needs it addresses. While the “monster” itself may eventually go back into hiding under the bed, the consumer desires it taps into like authenticity, community belonging, and emotional connection will endure.
Some brands are already applying these insights:
- Entertainment companies are developing characters that blend contrasting emotional appeals rather than fitting neatly into established categories
- Retail businesses are redesigning stores to facilitate community interaction rather than just efficient transactions
- Digital platforms are creating features that enhance the emotional and social dimensions of shopping rather than simply optimizing for convenience
The results of these approaches are becoming clear in market performance data. According to research from Forrester, brands that successfully build emotional connections with consumers see a 52% higher lifetime value than those focusing on transactional relationships.
The Future of Consumer Insights
The Labubu case demonstrates why tomorrow’s market research must evolve beyond traditional methodologies. Successful consumer insights will increasingly integrate:
- Digital ethnography that observes consumers in their natural environments, including online communities
- Neuromarketing techniques that measure subconscious reactions rather than just stated preferences
- Cultural analysis that identifies emerging shifts in aesthetic preferences and value systems
Conclusion
The unlikely success of a sharp-toothed monster character serves as a powerful reminder of market research’s true purpose: not merely to describe current preferences, but to unlock deeper insights about human psychology and social dynamics.
At Sila, we help brands uncover those “hidden” insights through a variety of solutions that blends traditional research methods with digital understanding to give you the full picture of your brand and your audience.
Curious what your Labubu might be? Let’s chat.
