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Tencent News "Periscope"

Author Yang Shi Editor Liu Peng

"My child buys cards about two or three times a month, sometimes a whole box, sometimes a small package, and spends about 300 yuan a month." Ms. Bai (pseudonym) revealed to Tencent News "Qianwang". Ms. Bai's daughter is eight years old this year. She "followed her sister to get into it" and has been playing for "more than a year."

The cards that Ms. Bai's daughter is obsessed with are the My Little Pony cards that are popular among children nowadays - just like the Water Margin Warriors cards for the 90s and thePop MartSimilarly, the post-10s also have their own "blind box". My Little Pony card is obtained by the domestic company "Kayou".HasbroA "blind box" of cards produced after authorization.

The popularity of such an animation IP has far exceeded the imagination of outsiders. My Little Pony has a constantly updated rich card pool and a complex card rarity ladder, which requires players to continuously collect various rare cards through card purchases and card exchanges to expand their card pool.

If she really wants to "graduate" (a term in the card circle, meaning to collect all rare cards), Ms. Bai's daughter's monthly consumption of 300 yuan is far from the upper limit of the card circle. It is rumored that a My Little Pony "Twilight Sparkle" card was auctioned for a sky-high price of 160,000 yuan some time ago, and there is a screenshot of a My Little Pony card being sold for 250,000 yuan circulating on the Internet. This is obviously beyond the normal consumption capacity of minors and also exceeds the reasonable pricing range. Although such rumors were later clarified, they reflect the chaos in the secondary card market.

My Little Pony: Polycarpet Cards sells one million pieces a month in a single store, becoming a hard currency among children

The pink-packaged My Little Pony card boxes have long been firmly in the center of cultural and creative and trendy toy stores, attracting passing children. From time to time, you can hear children asking their elders for My Little Pony cards inside and outside the store.

There are also special terms for buying cards. There are small packs of "single draws" (a term in the card circle, referring to buying cards by pack). Usually, you can buy a pack of 5 to 6 cards for 2-10 yuan. The higher the price of a single pack, the easier it is to get rare cards. There are also those who spend dozens or even hundreds of dollars to directly "buy a box" (a term in the card circle, referring to buying a whole box of My Little Pony cards). The types and quantities of card packs in boxes of different prices also vary.

According to the regulations for blind box products, the output rate of cards of different rarity in each card pack will be marked on the back, which to a certain extent avoids the situation of spending money to draw cards but getting nothing. However, there are also different levels of rarity among cards, and if you want to get the highest rarity or a specific card, you still need a certain amount of luck.

If you already have a rare card, then finding a fellow My Little Pony fan to share your collection is a low-cost way to collect cards. "I think TCG (Trading Card Game) is a very social game that can easily become popular among children," Xiao Hao, a veteran card player, told Tencent News. He has been playing "Yu-Gi-Oh!", a trading card game based on the Japanese anime IP of the same name, since elementary school.

Xiao Hao mentioned, "When I was a kid, I would go to the school gate to draw Yu-Gi-Oh card packs, collect 'Dark Wizard' (rare cards in Yu-Gi-Oh), and use my extra cards to exchange with classmates for rare cards that I didn't have." In his opinion, My Little Pony card is just "Yu-Gi-Oh with a new skin." The IP and audience have changed, but the core gameplay remains the same.

Unlike the derivative competitive cards of battle anime such as "One Piece" and "Yu-Gi-Oh", Dong Ge, a practitioner in the trendy toy industry, said that My Little Pony card is "purely for collection" and does not have combat attributes, and does not require learning the rules of the game. "It is precisely because of this that it attracts many young users and female users."

Exquisite cards can not only provide "emotional value" for children, but also serve as a "social venue", Dong Ge told Tencent News "Qianwang". iResearch Consulting's "White Paper on the Marketing Value of Anime and Second Dimension People" mentioned that consumption for the purpose of socializing has become an important driving force for consumption among young people in China, and consumption has become an important way for young people to show their hobbies and attract like-minded people.

Ms. Bai feels deeply about this, "Children of the same age are all playing it. If she doesn't play it, we may have nothing in common." Children are both users and "the most dedicated promotion ambassadors" of My Little Pony.

When Tencent News "Qianwang" asked several merchants about the market of My Little Pony cards, they all received similar responses, "selling well" and "popular with children." According to reports, some cultural and creative stores can sell thousands of packs of My Little Pony cards in a week. The "fire" of My Little Pony cards has "burned" from the cultural and creative circles to community supermarkets. Ms. Bai told Tencent News "Qianwang", "There were no My Little Pony cards in the community supermarket before, but later many parents brought their children to ask, so now they are also selling them."

"My Little Pony cards are the best sellers," a dealer of card toys told Tencent News. The dealer opened a social media account in July to promote his card business, and in just one month, he has attracted nearly 500 people to join the fan group to "get the goods."

Offline stores can no longer satisfy children's desire to collect. In the official Taobao Kayou store, the monthly sales of two My Little Pony cards exceeded 100,000. Apart from official channels, Taobao has many My Little Pony cards with sales exceeding 10,000 last month. Some stores even have monthly sales of more than one million My Little Pony cards. According to dealers, the wholesale price is 55% off the original price, and if the volume is large enough, they can directly negotiate with Kayou, which means there may be more profit space.

Live broadcast card opening raked in 278 million in half a year

The huge business opportunities attracted more people to join in. They were not satisfied with the static online and offline sales and linked the cards with live broadcasts.

However, simply "shouting" is not enough to attract young people for a long time. In order to keep their attention, "card unpacking" live broadcast came into being. The so-called card unpacking live broadcast is actually the anchor moving the scene of consumers buying and unpacking cards offline into the live broadcast room. Consumers name a card package, and the anchor unpacks and checks the card for the consumer before mailing it out.

The cost of setting up this type of live broadcast room is extremely low. You can just set up a space in your own home. A table, a computer, a label printer, some lighting, an acrylic shelf to display cards and card packs, and some cheap floral decorations are all you need to set up the live broadcast room. The live broadcaster doesn't even need to show his face, he just needs to show the process of opening the cards with his hands in front of the camera.

However, the simple and even somewhat crude style does not stop consumers from liking it. Data shows that in the first half of 2024 alone, the sales of card games related products on Douyin reached 278 million yuan (including various cards), second only to the trendy toy giant Pop Mart. If Xiaohongshu, which has a large number of female users, is included, the performance of card games will be even more exaggerated.

Such brilliance is obviously inseparable from the bonus of the live card-opening gameplay. An insider revealed to Tencent News "Qianwang" that the monthly income of ordinary card-opening anchors can reach 20,000 to 30,000 yuan, while the best ones can reach 40,000 to 60,000 yuan. Some card-opening live broadcast rooms are even husband-and-wife shops. The anchor broadcasts live in front of the camera, and his wife is responsible for purchasing, packaging, video editing, etc. behind the scenes. It can be said that there is no additional labor cost.

According to Chanmama data, a live broadcaster with more than 1.6 million fans on a certain platform has a sales volume of 1 million to 2.5 million yuan in the past month. On this platform, there are more than a few hosts who can achieve sales of millions.GMVCompared with the beauty live broadcast that has exceeded 100 million, it is indeed not worth mentioning. But you have to know that the unit price and audience of trading cards are also not on the same order of magnitude as beauty products, so it is not an exaggeration to say that such a sales volume can be achieved.

As an entrepreneur in the trendy toy industry, Asong told Tencent News' "Qianwang" that he started the live broadcast card opening project two years ago. The first account he created had a GMV of over one million in the first month. He was also the first in the industry to pioneer the "add dishes" gameplay. Now he has expanded to more than 30 live broadcast rooms.

The "adding dishes" he mentioned is a way of playing that has been explicitly banned by a certain platform, that is, encouraging consumers to place orders by making a small bet for a big gain. In February of this year, the Douyin e-commerce platform issued the "Notice on the Special Governance of Gambling in Card Removal in Live Broadcast Rooms", which pointed out that some influencers engaged in gambling in card removal in live broadcast rooms, specifically by removing low-priced cards to hit rare cards or puzzle cards, etc., inducing consumers to continue removing cards until they hit high-level card rewards, making card removal a gambling arbitrage method. For behaviors such as "adding dishes" and "physical rewards" that occur during card removal, the platform will regard them as gambling-related behaviors of making a small bet for a big gain, and will punish illegal stores and influencers by clearing out and deducting all illegal income.

According to industry insiders, Kayou is currently working with multiple platforms to further negotiate and improve relevant live broadcast regulations. However, the "card removal" live broadcast format is not unique to My Little Pony, and there are a large number of personal live broadcast accounts emerging on various platforms, which Kayou, as a product producer, cannot do.

Tencent News "Qianwang" found that "counting ponies", "hiding ponies", "Jenga" and other gameplays are still popular in the live broadcast rooms of some platforms. Take "Jenga" as an example. After consumers buy card packs, the anchor will open them for them. If they open a rare card of a certain level, they can get a free card pack. If the gifted card pack still meets the conditions, they can renew the pack for free. Some anchors even set up "non-African" gameplay specifically for consumers who feel that they are unlucky. As long as they don't get a rare card, they can continue to open packs for free.

Who is frantically pushing for sales for these anchors? Although most live broadcast rooms currently have a slogan that says "No minors are allowed to place orders", in actual operation, this slogan cannot dampen the enthusiasm of all minors, and it is difficult for merchants to confirm the true identity of the consumers behind the screen one by one. To some extent, the reminder that minors are prohibited is actually a self-protection for merchants.

Many anchors face the problem of minors asking their parents for a refund if they are not satisfied with the quality of the card pack after unpacking the cards. Therefore, some anchors will inform consumers in various ways that the order is assumed to be made by a minor or adult with parental consent. One anchor who unpacks cards on Xiaohongshu even posted a "review" warning on his homepage to dissuade underage consumers.

Speculators' speculation of high-priced single cards needs to be regulated urgently

Those who come to the live broadcast room to "gamble big with a small investment" are not only minors who are curious and want to try it, but also many adult card players are also buying cards for "investment" under the encouragement of high prices of real money in the secondary market.

Although the six-digit price tag for a single card is suspected of speculation, it is understood that there are rare My Little Pony cards with prices exceeding ten thousand in the secondary market, and there are even more single cards with prices of three or even four digits. Generally speaking, the cards sold in the secondary market are packaged in exquisite plastic cases and have ratings such as 9.5 or 10 on them.

The seller pays for the cards to be graded by some recognized grading agencies in the card industry. These agencies will grade the cards based on the printing quality, degree of wear, etc. After the grading, these cards can be transformed into real "collectibles".

After the My Little Pony card became popular, these card rating agencies also made a lot of money. Baocui Rating, whose main business is to identify ancient coins, even joined in the fun and launched the rating business for My Little Pony cards.

Grading services from agencies such as PSA and CGC are not cheap. It is understood that a well-known card grading agency charges 19.9 yuan per card for general grading, 29.9 yuan per card for limited grading, and 39.8 yuan per card for quick grading. Such prices far exceed the purchase cost of a single My Little Pony card.

The high star rating price is followed by high returns. An insider of the agency revealed to Tencent News "Qianwang" that although the rating agency does not directly participate in the secondary market, according to his understanding, a relatively rare card after being rated by them "can cost tens of thousands of dollars if it is in slightly better condition." Although the performance of their agency was not disclosed in detail, the insider said, "The market is very good, and many single cards handled by us are priced over thousands in the secondary market." Such a statement may be suspected of promoting their own services, but to some extent it is also a profile of the market situation.

When referring to the craze in the secondary market for My Little Pony cards, trendy toy entrepreneur Asong told Tencent News’ Periscope that “you can stock up with your eyes closed, there is nothing to lose.” Practitioner Dong Ge revealed to Tencent News’ Periscope that he heard that more than a dozen dealers have invested over 100 million yuan in a certain IP’s cards, strictly controlled the supply, and hyped up the prices of some single cards to over 10,000 yuan. However, the authenticity of such rumors remains to be verified. After all, the core demand of dealers is to increase sales rather than the price of single cards. Some industry insiders believe that the 160,000 single cards that have been circulated online should be deliberately hyped by people with ulterior motives, intending to create the illusion of “hotness” in order to attract speculators who do not know why to speculate in cards, and then “make the fake become true” and earn the difference.

Such an operation has certain risks, because after the popularity declines, the value of the card itself as a printed product is not high, and the depreciation of the card has already happened once in the IP represented by Kayou.

The last card IP made popular by Kayou was Ultraman, which was still aimed at minors. Public information shows that Kayou's revenue in 2021, 2022 and the first nine months of 2023 mainly came from collectible cards, which were 2.17 billion yuan, 3.93 billion yuan and 1.675 billion yuan respectively.

It can be found that in 2022, Kayou's collectible card business reached its peak, and Ultraman cards played an indispensable role in this. According to data disclosed by IP holder Yuangu, its revenue in the card category from April 1, 2023 to March 31, 2024 fell sharply by 69% year-on-year, and the main reason was the Ultraman cards in cooperation with Kayou. According to an industry insider, the market for Ultraman cards began to "collapse" in June and July last year. The rare cards that once cost 66,666 yuan each in the secondary market are now only 666 yuan, a 100-fold reduction.

After that, My Little Pony became popular. Dong Ge, an industry insider, said, "Ultraman failed, so My Little Pony became popular. One IP comes after another. Anyway, Kayou has many authorized IPs."

The secret of Kayou is not only the IP, but also the gameplay of collectible cards itself. According to the report of Zhushi Consulting, Kayou's collectible card sales lead the industry. In January 2024, Kayou officially submitted a listing application to the Hong Kong Stock Exchange, seeking to be listed in Hong Kong (but according to information from the Hong Kong Stock Exchange, Kayou's listing application submitted at the beginning of the year has expired recently). According to Kayou's prospectus, in terms of total merchandise transaction volume, Kayou ranked second in China's pan-entertainment toy industry in 2022, with a market share of 13.1%, while the first place was the well-known Lego. In other words, if you only look at the sub-segment of collectible cards, Kayou is absolutely the first.

Although the cards are small, the market is definitely big enough. Compared with mature markets such as foreign star cards with a history of hundreds of years, China's collector's card market started late, but the growth rate is gratifying. The "2023 China Collector's Card Market Research Report" released by iResearch Consulting shows that in 2022, the scale of Chinese collector's card consumers will be 4.333 million, a year-on-year increase of 37.8%; the market size of China's collector's card industry will exceed 10 billion yuan, a year-on-year increase of 42.1%. It is expected that by 2025, its market size will reach 27.66 billion yuan, still maintaining a year-on-year growth rate of 30%.

Kayou is one of the early players to enter the market. Its official website shows that the cooperative IPs of card products include "Detective Conan", "Naruto", "Crayon Shin-chan", "Hatsune Miku", etc., totaling more than 30. However, this cannot be Kayou's reliance once and for all. It is understood that Kayou is currently developing its own IPs, such as "Kaiyou Three Kingdoms", with sales of hundreds of millions of yuan, and will also launch card products of well-known IPs such as "Jin Yong's Knight Order" in the near future. Some media analyzed that whether Kayou can renew the contract at a favorable price after the expiration of the existing licensed IP, and the growth of its own IP will become the source of uncertainty for Kayou's future. In addition, there are many competitors who are eyeing it, such as A-share listed companies that are also developing Ultraman IP cards.Huali Technology, the card collection club that owns many top domestic IPs such as "Douluo Dalu", "Battle Through the Heavens", and "The King's Avatar". In addition to strong domestic rivals, the return of Blizzard's card game Hearthstone Legend andDisneyThe news of launching its own card game may affect the market structure of the card game.

In fact, Tencent News' Qianwang found voices calling for "cards to be out" in multiple My Little Pony fans' group chats, and clicking on the seller's social media homepage, you can see information such as "graduation" and "quitting the game." On Xianyu, you can also see that many parents have started the business of helping their children deal with "outdated" cards.

Ms. Bai told Tencent News “Qianwang”, “Sometimes we are very happy when we draw a good card, although we don’t know what the card can be used for. I feel that as we grow older, we may soon stop playing and move on to the next pit…”