Perfect Diary Private Traffic

Perfect Diary case study: How this Chinese makeup brand got to the top

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The c-beauty brand Perfect Diary is one of the first Chinese cosmetics brands to go global. The rise of this Chinese cosmetics brand started on its home soil of China, using the strategies of KOL marketing, co-branding, and private traffic. This Perfect Diary case study dissects how the brand became so popular so fast.

Since 2011, the cosmetics market in China has seen sustainable growth. In 2018, the market size of cosmetics industry in China reached 369 billion RMB. China’s cosmetics market has huge room for growth and some local brands are now going popular. With the prediction of Goldman Sachs, the sales volume of cosmetics in China is expected to grow to 145 billion dollars in 2025, which is twice the size of the market in 2019.

Click to download our report on Perfect Diary’s China market strategy

Perfect Diary's China market strategy

Behind Perfect Diary’s quick rise to fame

Perfect Diary is a young Chinese makeup brand established in 2016 targeting women aged 20-35, who have a relative high spending power. On March 2017, it started online business on Taobao and Tmall. Half a year later, Perfect Diary opened on Xiaohongshu, WeChat store and hosted three Pop-up stores in Shanghai. In 2018, It established Douyin and JD store. On January 19th 2019, it owned the first offline experience store in Guangzhou. As of June 2019, it has 40 offline stores in China.

Behind the success of Perfect Diary in the Chinese market

During the 11.11 promotion on Tmall in 2018, Perfect Dairy became the top Chinese makeup brand and in 2019 achieved 100 million RMB turnover within 13 minutes on the platform. It continuously topped the list and even exceeded famous international brands like L’Oréal and Maybelline.

Perfect Diary No.1 cosmetics brand in China

Source: Tmall, Perfect Diary tops the list of Chinese makeup brands

The rank of Chinese makeup brand on Tmall Double 11 promotion

Source: Tmall, The rank of Chinese makeup brand on Tmall Double 11 promotion

In the “Hurun Greater China Unicorn Index 2019 Q3” report published by Hurun Research, Perfect Diary was ranked 6th on the top new Unicorn list, with valuation at 7 billion RMB.

The top new Unicorn list in Hurun Greater China Unicorn Index report
Valuations in 100 million RMB

Source: Hurun, The top new Unicorn list in Hurun Greater China Unicorn Index report

The sales of this Chinese makeup brand has once again ranked the No. 1 among makeup brands on Tmall during Double 11 promotion in 2020. Until November 11, the cumulative sales of Perfect Diary on 11.11 promotion exceeded 600 million products.

Source: Sina, Perfect Diary ranking the No. 1 among makeup brands on Tmall

Perfect Diary’s parent company listed in the NYSE

On the evening of November 19, 2020 Beijing time, YATSEN, the parent company of Perfect Diary, was officially listed on the New York Stock Exchange under the stock code of “YSG”, becoming the first Chinese beauty company listed in the United States.

YSG listed on NYSE

Source: Sina, YSG listed on NYSE

Perfect Diary’s China market strategy

Perfect Diary is regarded as the king of Chinese makeup brands. It has extraordinary performance in China’s cosmetics market. In this case study of Perfect Diary’s market strategy, we have found three main factors that contribute to its success.

Co-branding collaboration with popular IP

Perfect Diary has cooperated with the Discovery Channel, the British Museum and the New York Metropolitan Museum of Art to launch new products in China’s cosmetics market. The eyeshadow palette jointly produced with the British Museum achieved a sales of 1 set every 11.5 seconds during 11.11 promotion in 2018. In addition, Perfect Diary and New York Metropolitan Museum of Art launched co-branding lipsticks achieved both word of mouth and sales during 618 promotion on Tmall 2019. Recently, Perfect Diary also takes advantage of the “national tide” trend and cooperated with National Geography to launch the newest eyeshadow palette. The views on Weibo reached 7.4 million.

Co-branding China market strategy with Perfect Diary and National Geography

Source: Perfect Diary, Eyeshadow launched by Perfect Diary and National Geography

The Chinese beauty brand also launched a co-branded product with Li Jiaqi’s popular pet dog Never. On March 5, 2020, when this puppy eyeshadow palette was officially on sale, 300,000 plates were sold in seconds, plus the 150,000 pre-sale in Li Jiaqi’s live broadcast room two weeks ago, Never brought huge business value to Perfect Diary.

Weibo, Puppy eyeshadow palette

Source: Weibo, Li Jiaqi’s Puppy eyeshadow palette, both co-branding and co-branding

Utilizing social media as the main promotion channels

Perfect Diary utilizes social media to reach potential consumers. In spite of promoting on normal social platforms like Weibo and WeChat, it also leverage the community advantages of Xiaohongshu (50% of users are below 30 years old) and Bilibili (80% of users were born in the 90s). Perfect Diary’s official account on Xiaohongshu has 1.92 million followers. We can see more than 110,000 notes when searching for the keyword “Perfect Diary”. Also, when searching it on Bilibili, the number of results reaches the upper limit of 50 pages. And there are many attractive titles like “the most cost-effective products”, high quality domestic cosmetics products” and so on.

 bilibili, Homepages of Perfect Diary on XHS and bilibili
 bilibili, Homepages of Perfect Diary on XHS and bilibili

Source: Xiaohongshu, bilibili, Homepages of Perfect Diary on XHS and bilibili

Though intensive promotions on social media, Perfect Diary has accumulated a lot of high-quality users’ reviews boosting the brand reputation and reaching more young users.

Effective KOL strategy

We can observe the succcess of the brand’s promotion strategy from 110,000+ notes related to the brand on Xiaohongshu.

Firstly, collaborating with celebrities to lead trends and create momentum. For instance, Perfect Diary maximized the fans ’economy by launching ‘the Little Black Diamond’ series lipstick with Chinese celebrity, ZhuZhengting. The fans’ participation and interaction is intense during this promotion. The limited edition products sold out in only three seconds.

Secondly, cooperating with KOLs who can contribute high-quality content and motivate word-of-mouth marketing. The Chinese beauty brand cooperated with Li Jiaqi, who is a web sensation to recommend Perfect Diary’s products during his live broadcasting. During the 11.11 shopping festival, Perfect Diary teamed up with him to launch the ‘small pink diamond’ lipsticks. Its brands’ visibility reached the peak of all Chinese cosmetics products. Finally, by utilizing the bandwagon effect, Perfect Diary can get more in-person experience shared by common users to reach more consumers.

Converting public traffic (traffic from marketplace) into private traffic (traffic from self-owned channels) at low cost

How to acquire private traffic in China

Source: daxue consulting, Acquiring process of Perfect diary’s private traffic in China

Perfect Diary attaches promotion card with products sold on marketplace and using lucky money to encourage consumers to enter its private traffic pool. After adding personal account Xiaowanzi, she will give access to customers to get lucky money and send personal invitation to enter private traffic group.

How Perfect Diary implements private traffic marketing

Private traffic in China refers to users that can be reached freely and communicated with repeatedly. Building brand-owned traffic pool and reaching customers would be lower in cost and easier, as compared with paid channels. Perfect Diary is an outstanding example of operating private traffic in China. Let’s see how it implements private traffic marketing.

Creating a virtual KOC character to get closer to customers

The brand created a virtual KOC character Xiaowanzi小完子, who has similar characteristic with Perfect Diary’s target consumers and plays the role of customer’s beauty consultant, friend, provider of benefits-related information and real-time customer service. This KOC character can help the brand build closer relationship with consumers. Based on close relationship, Perfect Diary makes communication more effective and efficient.

Private Traffic Strategy in China

Source: daxue consulting, Character image of Xiaowanzi

Building personal connections with consumers

Private traffic strategy in China

Source: daxue consulting, Black technology behind Perfect Diary’s personal account matrix

Perfect Diary creates a personal account matrix to provide customized service. By leveraging group control technology, Perfect Diary created hundreds personal account with unified character image called “Xiaowanzi”. Normally, each WeChat personal account can have no more than 3000 contacts. So, Perfect Diary has already had millions of followers in its private traffic pool.

Effective communication to inspire re-purchase

Different personal accounts of Perfect Diary not only share high quality contents in WeChat moments to stimulate shop desire but also provide promotion contents in the consumer group they managed.

Social media marketing strategy in China

Source: daxue consulting, Effective interactions of personal accounts

Perfect Diary has hundreds of private traffic groups, and each is managed by one personal account. The manager Xiaowanzi acts as a reliable friend and provides exclusive service for all consumers in the group.

Maintaining retention on brand-owned sales channels

The beauty brand has 6 public accounts and each of them are WeChat store entry points.

WeChat marketing in China

Source: daxue consulting, Entry points to Perfect Diary’s WeChat stores

Links in each WeChat post provide entrance to Perfect diary’s flagship store, which is the main shopping channel on WeChat, providing with all products. Links shared by Xiaowanzi in the WeChat group also provide entrance to the branch store called “Abbys choice”, which might relate to each personal account’s KPI.

Establishing new private traffic pool based on offline stores

Acquiring private traffic in China

Dource: daxue consulting, Perfect Diary established new private traffic pool based on offline stores

Perfect Diary has upgraded its market strategy to focus on new retail since 2019. It has opened 40 offline stores in 2019, and plans to open 600 stores in the next 3 years. On September 28, 2020, the 200th store of Perfect Diary officially opened in Futian, Shenzhen, marking that it has reached its 2020 store opening goal ahead of schedule. From the opening of the first store in Guangzhou Grandview Plaza to the completion of the 200th store, Perfect Diary only took 20 months, and it has stores in the first to fifth tier cities in China.

By establishing offline stores, the brand aims at improving shopping experience and create new private traffic pool. It hopes 65% customers in offline stores are new consumers, who haven’t bought their products online. After purchasing products in offline stores, customers will be given free gifts and motivated to enter Perfect Diary’s new private traffic pool, which is managed by a new KOC character called “Xiaomeizi 小美子”

Best example of Private Traffic marketing

Perfect Diary’s market strategy is a perfect example to learn how to gain independence from the marketplace. It leverages KOL strategy and creates brand recognition on social media platforms in order to stimulate purchase desire. Then it converts rich outside resources into its private traffic pool on WeChat, which can be conducive to re-purchasing and realizes consumer retention.

Private traffic costs less while public traffic is becoming more and more expensive. So, it is high time that a brand should gain independence though establishing private traffic in China. If you want to know how to get brand independence in China, email our project team at dx@daxueconsulting.com to start your China market strategy project.


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