>>10598579Plastic building blocks systems have always been about imitating, copying and stealing from each other, I mean Lego set the standard all the way back at the beginning. There's a fair amount of innovation among the non-Lego brands, both in minifig design and development of new parts; the latter is less visible but is definitely there.
A big consideration is these brands all understand and acknowledge that Lego is the monolith that is never going to be toppled by their likes. However, they can get a share of that market by offering stuff that Lego doesn't, and often at a cheaper price for comparable level of quality. A common selling point of non-Lego brands is they are compatible with Lego, which means using Lego's parts makes sense from a business standpoint. It's also cheaper to go with something proven than to R&D a whole new system (China's industry has been an imitative one over an innovative one for pretty much the entire modern era so that's also a factor).
Again, The main competitive elements are offering something that Lego doesn't for whatever reason and at a highly competitive price. Lego itself has been doing some imitating of its own, introducing parts that were first developed by Mega for example. If we want to talk about stagnation, Lego hasn't changed the standard minifig for something like 50 years, instead doubling down by fighting and winning trademark battles to force those Chinese brands to stop using them. Ironically this kicked off a whole wave of innovation as those companies had to come up with new designs, often improving upon the Lego one by adding more points of articulation and other changes.