Pop Mart International Group Ltd. shares tumbled more than 5.5% on Friday, hitting their lowest level since May, after a viral livestream incident reignited public debate over the company’s product pricing and brand perception. The Hong Kong-listed toymaker — best known for its Labubu blindbox series — found itself in the middle of a social media storm that analysts say could further erode investor confidence amid already weakening demand in China’s collectibles market.

The controversy surfaced after a Pop Mart employee appeared to question the value of one of the company’s own products — a phone chain blindbox priced at 79 yuan ($11) — during a live broadcast on Thursday. The clip quickly went viral on Xiaohongshu and Weibo, prompting a wave of consumer criticism about Pop Mart’s pricing practices.

Consumer Backlash Over “Overpriced” Collectibles

The livestream incident triggered widespread backlash from Chinese netizens, who accused Pop Mart of overpricing low-cost products. One widely shared comment read: “A string of these plastic beads costs less than two yuan, yet it’s the obsession of young people that has spoiled Pop Mart.” Another user defended the employee, suggesting that “they only told the truth” about the company’s high prices.

The controversy underscores growing consumer sensitivity toward brand value and affordability in China’s post-pandemic retail environment. Once celebrated for its collectible toy culture and limited-edition hype, Pop Mart is now facing what analysts describe as “brand fatigue,” particularly as consumers become more price-conscious and alternative IP brands rise.

Secondary Market Weakness Adds Pressure

Adding to the negative sentiment, the secondary market for Pop Mart’s Labubu collectibles has cooled sharply. According to Qiandao, a popular Chinese trading platform, the average resale price for a 14-piece Labubu mini-set dropped 16% over the past month, falling below its official retail price of 1,106 yuan. Larger Labubu dolls also saw single-digit price declines over the same period.

Goldman Sachs analysts, led by Michelle Cheng, said in a research note that the price declines reflect both oversupply and increased monetization efforts. “High-frequency pricing data continues to weigh on investor sentiment toward IP-driven brands,” the note stated.

Pop Mart’s strategy of scaling up production — aimed at capitalizing on the Labubu craze — may have inadvertently reduced the exclusivity that once drove secondary market premiums. The decline suggests that Pop Mart’s brand value could be entering a normalization phase, as the market adjusts to increased supply and waning hype.

Investor Sentiment Weakens as Stock Slides

Pop Mart’s stock has now fallen about 38% since its late-August peak, as investors take profits and reassess the sustainability of demand. The company, hailed as one of China’s hottest consumer success stories, benefited immensely from its collectible culture and millennial fanbase, but analysts are warning of potential growth saturation.

Sanford C. Bernstein analysts, led by Melinda Hu, predict that Labubu’s sales volumes are likely to peak in 2026–2027, citing concentration risk in Pop Mart’s intellectual property portfolio. “The probability of replicating such success with new characters is remarkably low,” the team wrote in an October 16 note.

However, Morgan Stanley analysts pointed to some positive signs, noting that Twinkle Twinkle, a newer Pop Mart IP, is gaining strong traction — though its momentum is constrained by supply shortages. This could provide limited offset to the company’s current slowdown if managed effectively.

The Road Ahead: Restoring Trust and Diversifying IP

For Pop Mart, the latest backlash could prompt management to rethink its pricing strategy and marketing approach. The company’s success hinges on maintaining a delicate balance between exclusivity, affordability, and consumer enthusiasm.

While Pop Mart’s diverse character lineup gives it potential for new growth cycles, analysts caution that brand diversification and global expansion will be essential to sustain performance in a market increasingly skeptical of hype-driven consumption.

Unless Pop Mart can restore consumer trust and recalibrate its value proposition, Friday’s drop could signal a broader re-rating of the company’s long-term growth prospects.