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Insight of the Day: The record-breaking run of ‘Ne Zha 2’ may seem like a surprise. It shouldn’t

Writer's picture: InsightTrendsWorldInsightTrendsWorld

Why?

  • Chinese Animation Industry is on the Rise:  The article highlights that Chinese animation has been steadily growing in popularity and quality for the past decade.  Films before "Ne Zha 2" had already shown increasing success, indicating a strong upward trend. This wasn't a sudden jump, but a continuation of existing momentum.   

  •   Appeals to a Wide Audience: "Ne Zha 2" wasn't just a children's movie. It successfully attracted viewers of all ages, significantly expanding its potential audience compared to animations with a narrower demographic.   

  •   Strategic Timing During Peak Season:  Releasing the film during the Spring Festival, the most important holiday in China and a major movie-going period, was a calculated move. This prime release window greatly increased its chances of box office success.   

  • Government Backing and Industry Support: The Chinese government is actively supporting the domestic film industry, including animation, through subsidies and strategic plans. This support creates a favorable environment for domestic films to thrive.   

  • Precedent of Success with "Ne Zha 1": The first "Ne Zha" film was already a massive hit in China. This established franchise recognition and audience anticipation for a sequel, making the success of "Ne Zha 2" more predictable.   

  • Focus on the Domestic Market:  "Ne Zha 2" is tailored to resonate with Chinese culture and audiences. By focusing on the massive domestic market, it didn't need to rely on international appeal to achieve blockbuster numbers, making success within China more achievable.

In short, the article argues that "Ne Zha 2" didn't come out of nowhere. Its record-breaking success was built upon the growing strength and strategic development of the Chinese animation industry, combined with smart release timing and a film designed to resonate deeply with local audiences.   

Why it is the topic trending:

  • Record-Breaking Success of Domestic Animation: ‘Ne Zha 2’ becoming the top-grossing animated film worldwide, surpassing Pixar's ‘Inside Out 2’, is a surprising and noteworthy achievement for Chinese animation, attracting significant media attention.

  • Growth of Chinese Animation Industry: The article highlights the increasing quality and popularity of Chinese animated films in recent years, indicating a significant trend and industry shift that is newsworthy.

  • Cultural Significance: The success of a film rooted in Chinese mythology like ‘Ne Zha 2’ resonates culturally and sparks discussions about the rise of domestic cultural products and their global appeal.

  • Industry Milestone:  The article frames ‘Ne Zha 2’s’ success as an industry milestone, suggesting a turning point for Chinese animation and its potential on the global stage, making it a topic of interest for industry observers and investors.

Overview:

The article "The record-breaking run of ‘Ne Zha 2’ may seem like a surprise. It shouldn’t" discusses the unexpected yet explainable success of the Chinese animated film ‘Ne Zha 2’. It argues that the film's record-breaking box office is not a surprise but rather a result of the growing momentum and increasing quality of Chinese animation over the past decade, supported by government initiatives, strategic release timing, and a focus on domestic audiences. The article highlights the achievements of studios like Light Chaser Animation and Beijing Enlight Media, the producer of ‘Ne Zha 2’, and points to the broader trend of Chinese animation shedding its ‘childish’ image and becoming a significant industry player.

Detailed Findings:

  • ‘Ne Zha 2’ Box Office:  Exceeded 13 billion yuan ($1.79 billion) globally, becoming the top-grossing animated film worldwide and surpassing Pixar’s ‘Inside Out 2’.

  • Spring Festival Release: ‘Ne Zha 2’ was released during the week-long Spring Festival holiday in China and captured half of the box office during this period.

  • Growth of Chinese Animation: Chinese animated films have gained significant traction in the last 10 years, with notable films like ‘Big Fish and Begonia’ (2016), ‘Ne Zha 1’ (2019), ‘Deep Sea’ (2023), and ‘Chang An’ (2023) preceding ‘Ne Zha 2’s’ success.

  • ‘Chang An’ Success: ‘Chang An’ earned around $250 million in 2023 and was the only animated film in China's top 10 movies that year.

  • Light Chaser Animation:  A leading Chinese animation studio with over 380 employees, planning to expand to over 480 and increase production to two movies per year from 2026.

  • Government Support: Chinese government subsidies and national plans are supporting the domestic animation industry, aiming for 50 domestic films per year with at least 100 million yuan box office each by 2035.

  • Domestic Market Focus: ‘Ne Zha 2’'s success is primarily within China, contrasting with Disney blockbusters that achieve global success.

  • Waning Hollywood Influence: Hollywood films are experiencing declining popularity in China, with only ‘Godzilla x Kong’ cracking the top 10 in 2023.

  • Online Content Influence: Popular Chinese animated series are increasingly based on online stories from platforms like China Literature.

  • AI in Animation: Chinese creators are exploring generative AI for animation production, as seen with Kuaishou’s AI-generated mini-series.

Key Takeaway:

The success of ‘Ne Zha 2’ is not a fluke but a sign of the maturation and growing global competitiveness of the Chinese animation industry, driven by increasing quality, strategic market focus, government support, and evolving audience preferences.

Main Trend:

  • Trend Name: "Chinese Animation Ascendancy"

Description of the Trend ("Chinese Animation Ascendancy"):

"Chinese Animation Ascendancy" describes the trend of Chinese animated films rapidly gaining prominence and achieving significant box office success, both domestically and internationally. This trend signifies a shift in the global animation landscape, with Chinese animation moving beyond its traditionally ‘childish’ image to produce high-quality, culturally resonant, and commercially viable films that are increasingly competing with and even surpassing established international animation giants.

Consumer Motivation:

  • Cultural Resonance and National Pride: Chinese audiences are increasingly drawn to stories rooted in their own culture, mythology, and history. The success of films like ‘Ne Zha 2’ taps into a growing sense of national pride and a desire to see Chinese stories told on screen with high production values.

  • Demand for Quality Animation:  Chinese consumers are developing a taste for high-quality animation that can rival international standards. They are seeking visually stunning, well-storyed animated films that cater to diverse age groups, not just children.

  • Shifting Preferences Away from Hollywood:  There is a noticeable shift in preference among Chinese audiences, with a growing appetite for domestic content and a potentially waning interest in some Hollywood franchises, creating space for local productions to thrive.

  • Desire for Diverse Storytelling:  Audiences are seeking diverse narratives and perspectives beyond the typical Hollywood formula. Chinese animation, with its rich cultural heritage, offers unique stories and visual styles that appeal to this desire for novelty and variety.

  • Support for Domestic Industry:  There's a growing sentiment of supporting and celebrating homegrown creative industries. The success of Chinese animation is seen as a positive development for the national cultural landscape, encouraging audiences to support domestic productions.

What is driving the trend:

  • Increased Production Quality and Technical Skill: Chinese animation studios are rapidly improving their animation techniques, storytelling capabilities, and production quality, closing the gap with international animation leaders and producing visually impressive and emotionally engaging films.

  • Government Support and Investment:  Government policies and financial support are playing a crucial role in fostering the growth of the domestic animation industry, providing resources and incentives for studios to produce high-quality films.

  • Strategic Focus on Domestic Market:  Chinese animation studios are strategically focusing on the massive domestic market, tailoring content and cultural elements to resonate strongly with local audiences, ensuring a large and receptive viewership base.

  • Leveraging Chinese Mythology and Culture:  Drawing inspiration from rich Chinese mythology, legends, and cultural heritage provides a wealth of unique and compelling story material that resonates deeply with domestic audiences and offers a distinct identity in the global market.

  • Evolving Audience Demographics and Tastes:  Changing audience demographics and evolving tastes in China are creating a more receptive environment for sophisticated and culturally relevant animated films that appeal to a broader age range.

Motivation beyond the trend:

Beyond immediate drivers, the underlying motivation is a desire for "cultural self-expression and global recognition through animation." "Chinese Animation Ascendancy" reflects a broader cultural movement in China to assert its cultural identity on the global stage through creative industries, with animation emerging as a powerful medium to showcase Chinese stories, artistry, and technical capabilities to the world, fostering national pride and cultural influence.

Description of consumers article is referring to:

  • Age:  Broad age range, appealing to families, young adults, and adults, as ‘Ne Zha 2’ success is attributed to its appeal across age groups.

  • Gender: Likely appeals across genders, as animation and mythological themes can attract both male and female audiences.

  • Income:  Likely targets a broad income range, as moviegoing is a popular entertainment activity across different income levels in China.

  • Lifestyle:  Urban and suburban populations in China who are regular moviegoers, interested in entertainment and cultural experiences, and increasingly supportive of domestic cultural products. Likely tech-savvy and engaged with digital entertainment trends.

Conclusions:

"Chinese Animation Ascendancy" is a significant trend, marking a turning point for the global animation industry. Driven by improved quality, government support, strategic market focus, and cultural resonance, Chinese animated films like ‘Ne Zha 2’ are achieving unprecedented success, captivating domestic audiences and increasingly gaining international recognition. This trend signals a shift towards a more multi-polar global animation landscape, with China emerging as a major force.

Implications for brands:

  • Partnership Opportunities with Chinese Animation Studios: Brands, especially those targeting Chinese consumers, should explore partnership and collaboration opportunities with successful Chinese animation studios to leverage the popularity and cultural cachet of domestic animated films.

  • Cultural Marketing and Localization:  Brands should take note of the strong cultural resonance of Chinese animation and adapt their marketing strategies to incorporate elements of Chinese culture and mythology to appeal to local audiences, mirroring the success of films like ‘Ne Zha 2’.

  • Merchandise and Licensing Potential: The popularity of Chinese animated films creates significant opportunities for movie merchandise, licensing, and spin-off products, offering brands new avenues for revenue and audience engagement.

  • Cross-Promotional Opportunities:  Brands can leverage the release of popular Chinese animated films for cross-promotional campaigns, aligning their brand image with positive cultural trends and tapping into the film's audience reach.

  • Investment in Domestic Creative Industries:  Brands operating in China can gain goodwill and enhance their brand image by investing in and supporting the growth of domestic creative industries like animation, aligning with national cultural pride and government initiatives.

Implication for society:

  • Rise of Domestic Cultural Power: The success of Chinese animation contributes to a broader trend of rising domestic cultural power in China, with homegrown creative industries gaining prominence and influence, both domestically and internationally.

  • Shifting Global Cultural Landscape:  The "Chinese Animation Ascendancy" is contributing to a more multi-polar global cultural landscape, diversifying sources of creative content and challenging the historical dominance of Western cultural exports in animation.

  • Cultural Preservation and Storytelling:  The trend encourages the preservation and re-telling of Chinese mythology, legends, and cultural stories through a popular and accessible medium like animation, fostering cultural identity and heritage.

  • Economic Growth in Creative Sector:  The growth of the animation industry contributes to economic growth and job creation in China's creative sector, fostering innovation and technological advancement in animation production.

Implications for consumers:

  • Wider Variety of Animation Content: Consumers, both in China and globally, will have access to a wider variety of animation content, with Chinese animation offering distinct visual styles, narratives, and cultural perspectives, enriching the overall animation landscape.

  • More Culturally Relevant Entertainment: Chinese consumers will have access to more culturally relevant entertainment options that resonate with their identity and heritage, fostering a stronger connection with domestic media.

  • Increased Choice and Competition in Animation Market:  The rise of Chinese animation increases competition in the global animation market, potentially leading to higher quality and more diverse offerings from animation studios worldwide, benefiting consumers with greater choice.

  • Potential for New Animation Styles and Techniques:  Chinese animation studios may introduce new animation styles, techniques, and storytelling approaches, pushing the boundaries of the medium and offering fresh and innovative viewing experiences for consumers globally.

Implication for Future:

  • Continued Growth of Chinese Animation Industry: The Chinese animation industry is poised for continued growth and expansion, both domestically and internationally, becoming a major player in the global entertainment market.

  • Increased International Co-productions and Collaborations:  Future collaborations and co-productions between Chinese and international animation studios are likely to increase, fostering cross-cultural exchange and creating globally appealing animated content.

  • Technological Innovation in Chinese Animation:  Chinese animation studios will likely continue to adopt and innovate with new technologies, including AI and advanced animation techniques, further enhancing production quality and efficiency.

  • Expansion into Global Markets:  Chinese animated films will increasingly target global markets, seeking wider international distribution and aiming to achieve broader international box office success beyond the domestic market.

Consumer Trend:

  • Trend Name: "Culture-Driven Entertainment Consumption"

  • Detailed Description: Consumers are increasingly engaging in "Culture-Driven Entertainment Consumption," prioritizing entertainment content that reflects and celebrates their own culture, heritage, and national identity. This trend signifies a shift away from solely Western-dominated entertainment and towards a greater appreciation for diverse, locally relevant cultural expressions in media.

Consumer Sub Trend:

  • Trend Name: "Domestic Animation Embrace"

  • Detailed Description: Within "Culture-Driven Entertainment Consumption," "Domestic Animation Embrace" highlights the sub-trend of consumers actively choosing and celebrating domestically produced animated films, driven by a desire to support local creative industries and enjoy stories that resonate with their cultural background and values.

Big Social Trend:

  • Trend Name: "Rise of Non-Western Cultural Power in Media"

  • Detailed Description: Society is witnessing a "Rise of Non-Western Cultural Power in Media," a broad social trend where non-Western countries and cultures are increasingly becoming significant producers and exporters of influential media and entertainment content, challenging the historical dominance of Western cultural narratives and diversifying the global media landscape.

Worldwide Social Trend:

  • Trend Name: "Global Animation Renaissance (Multi-Cultural Wing)"

  • Detailed Description: "Global Animation Renaissance (Multi-Cultural Wing)" reflects a worldwide trend within the broader animation renaissance, where animation industries are flourishing globally, particularly in non-Western countries, leading to a diversification of animation styles, narratives, and cultural perspectives on a global scale, enriching the medium and offering audiences worldwide a wider range of animated content.

Social Drive:

  • Trend Name: "Seeking Cultural Identity & Representation in Media"

  • Detailed Description: This social drive encapsulates the growing human desire to seek and celebrate cultural identity and representation in media and entertainment. Consumers are increasingly motivated to engage with content that reflects their own cultural background, values, and stories, fostering a sense of belonging and cultural pride in a globalized world.

Learnings for brands to use in 2025:

  • Authenticity and Cultural Nuance are Key: Brands targeting Chinese consumers must prioritize authenticity and cultural nuance in their marketing and product development, reflecting a deep understanding and respect for Chinese culture and values, mirroring the cultural resonance of successful domestic animations.

  • Local Partnerships Enhance Credibility: Collaborating with local Chinese entities, including animation studios and cultural figures, can significantly enhance brand credibility and resonance with Chinese audiences, tapping into the national pride associated with successful domestic cultural products.

  • Storytelling and Cultural Narratives Drive Engagement: Brands should leverage storytelling and cultural narratives in their marketing campaigns, drawing inspiration from Chinese mythology, history, and folklore to create emotionally engaging and culturally relevant content that resonates with consumers on a deeper level.

  • Support for Local Creative Industries Builds Brand Affinity:  Demonstrating genuine support for and investment in Chinese creative industries, like animation, can build strong brand affinity and positive brand perception among Chinese consumers, aligning with national priorities and cultural pride.

  • Adapt to Evolving Consumer Preferences: Brands must stay attuned to evolving consumer preferences in China, recognizing the growing demand for domestic cultural content and adapting their strategies to align with these shifting tastes and cultural trends.

Strategy Recommendations for brands to follow in 2025:

  • "Culture-Integrated Marketing Campaigns": Develop marketing campaigns that are deeply integrated with Chinese culture, mythology, and popular domestic entertainment trends, leveraging the cultural resonance of successful animations like ‘Ne Zha 2’ to connect with consumers on an emotional and cultural level. How:  Incorporate characters or themes from popular Chinese animations into advertising. Create culturally themed limited-edition products or packaging. Sponsor cultural events or animation festivals to demonstrate brand support for domestic creativity.

  • "Animation-Brand Co-creation Initiatives":  Initiate co-creation projects with Chinese animation studios, developing branded animated content, short films, or series that align with the brand's values and target audience, leveraging the studio's creative expertise and the animation's cultural appeal. How:  Partner with animation studios to create branded content for online platforms or social media. Develop interactive animated experiences or games featuring brand characters and animation styles. Sponsor animation workshops or training programs to support the growth of the industry.

  • "Domestic Talent & IP Collaboration Strategy":  Prioritize collaborations with domestic Chinese talent, artists, and intellectual property (IP), particularly in the animation and cultural sectors, to create authentic and culturally resonant brand experiences that tap into the growing popularity of homegrown creativity. How:  Partner with Chinese animators and artists for product design or marketing campaigns. License characters or stories from popular Chinese animations for branded merchandise. Feature Chinese voice actors and musicians in brand content.

Final sentence (key concept) describing main trend from article:

"Chinese Animation Ascendancy," exemplified by the record-breaking ‘Ne Zha 2’, is reshaping the global animation landscape in 2025, requiring brands to strategically embrace culture-integrated marketing and animation co-creation to resonate with culture-driven consumers in the age of "Culture-Driven Entertainment Consumption."

What brands & companies should do in 2025 to benefit from trend and how to do it:

Brands and companies should fully embrace "Chinese Animation Ascendancy" to thrive in the evolving Chinese market of 2025 by:

  • Culturally Authentic Brand Storytelling & Marketing: Prioritize culturally authentic brand storytelling and marketing that deeply integrates Chinese cultural elements, narratives, and artistic styles, mirroring the resonance of domestic animation successes and demonstrating a genuine understanding of local values and preferences. How:  Develop marketing campaigns that tell stories rooted in Chinese mythology, history, or folklore. Use visual styles and artistic techniques inspired by Chinese animation aesthetics. Feature culturally relevant symbols, imagery, and language in brand communications.

  • Strategic Partnerships & Co-creation in Animation Sector: Adopt a strategy of forming strategic partnerships and co-creation initiatives within the Chinese animation sector, collaborating with studios, artists, and IP holders to develop branded content, products, and experiences that leverage the popularity and cultural appeal of domestic animation. How:  Invest in co-producing animated short films or series with Chinese studios. Develop branded merchandise featuring popular Chinese animation characters. Create interactive animation-based brand experiences for online and offline channels.

  • Invest in & Support Domestic Animation Ecosystem: Focus on investing in and actively supporting the growth of the Chinese domestic animation ecosystem, contributing to industry development, talent cultivation, and the overall cultural landscape, enhancing brand image and building long-term relationships with Chinese consumers and the creative community. How:  Sponsor animation training programs and workshops for young Chinese artists. Provide funding or resources for independent Chinese animation studios. Create platforms or initiatives to showcase and promote emerging Chinese animation talent.

Final Note:

  • Core Trend:

    • Name: Chinese Animation Ascendancy

    • Detailed Description: The dominant trend of Chinese animated films achieving unprecedented success and global recognition, signaling a major shift in the animation industry and reflecting China's rising cultural influence.

  • Core Strategy:

    • Name: Culture-Centric Brand Integration

    • Detailed Description: Brands must adopt a strategy centered on culture-centric brand integration, deeply embedding Chinese cultural elements and partnering with the animation sector to effectively capitalize on "Chinese Animation Ascendancy" and resonate with culture-driven consumers.

  • Core Industry Trend:

    • Name: Global Animation Industry Diversification

    • Detailed Description: The global animation industry is undergoing a "global animation industry diversification," where non-Western animation industries, particularly China's, are rising to prominence, challenging Western dominance and creating a more multi-cultural and competitive global landscape.

  • Core Consumer Motivation:

    • Name: Seeking Cultural Resonance & National Entertainment Pride

    • Detailed Description: Consumers are primarily motivated by the desire to seek entertainment that resonates with their cultural identity and evokes national pride, increasingly favoring domestic cultural products like Chinese animation and driving the trend of "Culture-Driven Entertainment Consumption."

Core Trend Summary: The "Chinese Animation Ascendancy" trend is revolutionizing the global animation market in 2025, requiring brands to strategically prioritize culture-centric integration and animation partnerships to resonate with "Culture-Driven Entertainment Consumers" seeking cultural resonance and national entertainment pride. Brands should achieve this through culture-integrated marketing campaigns, animation-brand co-creation initiatives, and domestic talent & IP collaboration strategies.

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