In recent months, Labubu has become a recurring topic across social media in China and abroad. Offline stores in Europe and the US have seen lines stretch around the block, while some co-branded or limited-edition items are reselling for four- or even five-figure RMB sums (USD 560–1,400). And Labubu isn’t alone, as similar trends are emerging around other homegrown Chinese IPs.
These IPs have flourished online by creating recognizable, emotionally resonant characters that function as social currency among young consumers.
From the dominance of imported IPs to today’s thriving ecosystem of original creations, the shift reflects advances in creative content and accumulated cultural value, fueled by new forms of productivity and more efficient market mechanisms.
“Consumers, especially younger ones, are increasingly willing to pay for emotional value,” said Lu Jie, head of Aipy Studio under iFlytek’s artificial intelligence entertainment division. “For example, our input method’s user base keeps getting younger: users under 30 now account for 68.16%.”
This trend is clear in how people now personalize their digital worlds, such as changing skins, fonts, wallpapers, and avatars to express their individuality. Behind this shift is the growing influence of IP creators. Leveraging its AI capabilities and ecosystem, iFlytek aims to empower these creators and position itself as an enabler for the next generation of creative innovators.
The company’s newly launched Aipy Studio is one of iFlytek’s three core AI entertainment initiatives and a central pillar of its IP strategy. Designed as both a connector and an accelerator, Aipy Studio brings together and supports creative talent through a platform-based model.
On November 6, iFlytek announced a partnership with the Sichuan Fine Arts Institute, with Aipy Studio serving as the main collaboration platform, signaling its expansion into the IP space.
A new IP era
Why is iFlytek betting on the IP business?
According to Lu, the decision follows a clear shift in consumer behavior from functional spending to emotional consumption. “The pursuit of self-pleasure and emotional satisfaction has become a major consumption driver,” she said. “It’s a natural result of social progress, economic growth, and evolving consumer demand.”
Young consumers, particularly Gen Z, prize individuality and self-expression. Through what they buy, they seek connection, understanding, and emotional resonance. IPs have become the medium through which they purchase emotion.
The signs are everywhere: mystery boxes selling out within minutes, coffee chains boosting sales through IP collaborations, and malls using themed installations to attract shoppers. All point to the same conclusion: IP has become the new password for trendy consumption.
“When it comes to purchasing power in the IP market, Chinese consumers still have plenty of room to grow,” Lu said.
That leaves considerable untapped potential. At the same time, AI promises to unlock new possibilities for the industry.
Lu’s team identified a key pattern: IP consumption increasingly centers on interaction between users and products. These products serve not only as commodities but also as vessels of identity and emotion.
For example, more young people now decorate their bags with small plush charms and pins. These accessories have become social tokens that signal taste and personality.
“That tells us IP products are no longer confined to entertainment contexts,” Lu said. “They’ve become part of daily life, combining collectibility with social function. This gives AI a clear entry point to analyze behavior, respond faster to trends, and accelerate creative output that meets real demand.”
From this perspective, iFlytek views its expansion into IP as a natural extension of its strengths.
Across the designer toy market, AI is reshaping the entire value chain, from concept generation and smart manufacturing to personalized consumer experiences. By introducing interactivity, adaptability, and emotional connection, AI is redefining what collectibles can be. Emotionally responsive toys, for one, can generate new demand and elevate the value of both IP and AI.
Innovating to revitalize IPs
IP creation and management are intricate, detail-oriented processes. Lu noted that as the industry matures, its foundation has shifted.
“Traditional IPs mostly grew out of film and television. You had to go to the theater or watch a series on the television. But in the fast-consumption era, new media formats like short videos and livestreams can catapult an IP to fame in weeks,” she said. “Because these formats rely less on long, costly productions, viral IPs now spread much faster, sometimes through a single sticker pack or meme.”
The IP boom has attracted a wide mix of participants—traditional media, internet platforms, and independent creators—energizing the ecosystem while introducing new challenges.
According to iFlytek’s research, newcomers often face three major hurdles: breaking beyond niche fan bases, extending product lifecycles, and monetizing effectively.
“Many creators work alone. They may have great ideas but lack the resources and operational support to sustain growth,” Lu said. “Some IPs go viral quickly, but without strong follow-through, they fade just as fast.”
To address this, Aipy Studio aims to build a bridge linking creators to iFlytek’s vast user network, with the goal of amplifying visibility, extending IP lifespans, and accelerating commercialization.
Lu added that Aipy Studio offers end-to-end support by leveraging iFlytek’s ecosystem across market research, creative planning, design, production, sales, and after-sales service.
For example, during the research phase, iFlytek’s diverse product portfolio—including its input method app, smartphone partnerships, and music promotion channels—provides built-in environments for testing and surveys.
In manufacturing, Aipy Studio integrates upstream supply chains for efficient, multi-category production. On the sales side, iFlytek’s online and offline networks give creators direct consumer access.
“For designers, iFlytek’s AI tools and data insights act like creative amplifiers,” Lu said. “AI handles repetitive tasks such as asset gathering or parameter adjustments, freeing designers to focus on innovation.”
An anchor for growth and value
Launched in the second half of this year, Aipy Studio is still a newcomer but is reportedly expanding quickly. It has already established four divisions: IP operations, business development, product design, and distribution. The team’s goal is to help artists bring their ideas to life and position Aipy Studio as a global leader in IP operations.
Its talent pool is also growing rapidly. On the design side, Aipy Studio is actively recruiting from art colleges and has already received hundreds of submissions with encouraging early results.
Its partnership with the Sichuan Fine Arts Institute includes three initiatives:
- Talent development through co-created courses and workshops that integrate technology with music, design, and innovation.
- Research collaboration to establish a joint center for design standards and an AI aesthetics library.
- Career pathways via internships and employment channels connecting students to real-world projects.
These efforts reflect a broader ambition to merge technology and creativity. With AI as its foundation, Aipy Studio seeks to move the IP industry from experience-driven to intelligence-driven growth.
This approach also feeds back into iFlytek’s hardware business. Lu shared an example: when the company launched an AI-powered learning tablet featuring a Ne Zha 2 limited-edition design, it quickly captured children’s attention, she said.
“The fusion of IP and hardware is powerful, enabling the connection of products with user communities on an emotional level. Mastering IP operations can create great value for our core business,” she said.
Ultimately, Aipy Studio aims to become a catalyst for the future of Chinese IP: one where AI democratizes creativity, reduces production costs, and empowers everyone to create and express.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Xiao Xi for 36Kr.