Chen Wei of 52TOYS: from Veteran Player to CEO

Recently, 52TOYS, a collectible toy brand, announced the ending of its Series C Funding. This funding, with TAIHECAP as the exclusive financial adviser, secured 400 million yuan. As the first brand targeted at “collectible toy” in China, 52TOYS has expanded to cover IP incubation, product innovation, supply chain management, sales channel construction and market communication during the past six years, becoming one of the few brands in the industry that can cover the whole industry chain.

The following are excerpts from Chen Wei’s live speech. How does a veteran player with 20 years of experience make his hobby into a career? What does he think about the development of Chinese local toy brands? Here are the answers.

From Gulou game store to an “atypical” entrepreneur

Why a collectible toy brand?

Most probably, it’s because of my playful nature. I have been doing toy-related business since 2000, so I have over 20 years of experience in toys.

I regard myself as an “atypical” entrepreneur since my “entrepreneurship track” is essentially an interesting sector. You need to offer something that can amuse consumers. Consumers will pay only when they feel happy. So it requires me to study toys, movies, cultural and creative products in the “playing” state every day.

Driven and inspired by this, I was engaged in the collectible toy industry, and made some achievements.

Products are more important than channels

The previous part is kind of ideal. Let’s talk about the realistic part — the industry.

In the final analysis, this is a retail business. There has always been a debate about “product or channel, which is more important”. Some people think that only by firmly controlling the channels can their products be accessed by consumers.

But I believe that products are definitely more important than channels. collectible toy is essentially a consumer product for spiritual pleasure, which determines that creativity is the core of the industry. High quality is the critical factor making consumers willing to pay.

Therefore, the core competitiveness of this industry is creativity. 52TOYS set its orientation based on this idea. In the first years after establishment, products were given priority. In addition to original IPs, we cooperated with Marvel, Disney and other classic IPs to redesign the classic images in animation. We have seven product lines now, including the designer toys, which are more familiar to you, the “BEASTBOX” Series, and the “MODERN ANCIENT” Series.

Of course, channels matter, too. For sales, we cooperate with different types of channels, including fashion boutiques, toy stores, cinemas, bookstores and so on. You’ll find that you can buy 52TOYS products at the airport and other designer toy stores. Now we have more than 10,000 cooperation terminals in offline sales channels. What’s more, we started directly-operated brand stores when appropriate. 52TOYS has more than twenty directly-operated brand stores now, and the plan is to set up 100 directly-operated brand stores nationwide in the next year.

Trends are changing, and so are consumers

In the past two decades in contact with toys, I clearly felt that China’s designer toy consumer group was expanding, and some segments were changing.

1. Female-dominated? You may underestimate male consumers

However, as I have observed for the years, men and women have different preferences. In the field of collectible toys, female consumers show a high repurchase rate only for some small products with relatively low average price per customer, such as blind boxes. In contrast, the more subdivided the category, the larger the toy and the higher the average price per customer, the greater the proportion of male consumers. Compared with female consumers, male consumers, once attracted by a certain type of collectible toys, will become increasingly addicted and “heavy” players. In countries like Japan and the United States, men take a larger proportion in collectible toy consumer groups than women.

2. Gaps between adults and children, cities and towns, are shrinking

Consumers of different ages are showing more similar preferences. You will find that the differences between recreational articles for children and adults are blurring, and the gap between generations is shrinking.

This is mainly because the channels for people to access information are gradually converging. For example, many children have been using mobile phones and iPads since childhood. They have the same ways of accessing information as adults, so they will like the same products as adults. It’s quite normal. In my opinion, children and adults will present more and more similar preferences in the consumption of collectible toys and the like.

The unification of information acquisition channels also narrows the gap between consumers in first and second tier cities and those in third and fourth tier cities. In spite of some discrepancies in the level of consumption, they will be more and more alike in the general direction of consumption and interests.

3.  “Rise of China Chic” is another booster for collectible toys

In recent years, the rise of China Chic has been a doubtless trend. According to my personal experience, young people are showing greater passion and desire for Chinese culture than ever, which will invigorate the collectible toys.

You will find the products of this series interesting and amusing, while enjoying the historic and cultural elements in them. After all, young people don’t want to be “preached” when they are playing with toys.

A supply chain producing passion and happiness

As you can see, in recent years, people’s recognition about designer toys has been improving, and the whole industry shows a corresponding rise. I think with the increase of understanding, consumers will have higher requirements for the industry and the products. Therefore, we need to provide diversified products to meet different segmented needs. In general, the industry will become more and more diversified.

Companies rooted in this field should be able to cover every step of the industrial chain to develop comprehensive competitiveness. 52TOYS now covers IP incubation, product innovation, supply chain management, sales channel construction and market communication, basically the whole chain. Diversified products and channels can broaden the prospect of 52TOYS.

Collectible toy is really an interesting carrier. Movies, games, animation, comics, history, culture, tourism and even food, any of these can be the theme elements of collectible toys, and you’ll certainly find a right one. Ideally, collectible toy represents a lifestyle. People can get happiness, companionship, sociality, knowledge and others from the collectible toys.

Therefore, I hope 52TOYS can become a supply chain offering passion and happiness, to enrich and amuse the life of everyone.