Purcotton, after making its comprehensive digitization decision, chose to explore digital marketing with Tencent Marketing Cloud. Tencent Marketing Cloud has evolved from version 1.0 in 2021 to version 4.0 in 2024. Version 1.0 focused on unifying the IDs of 28 million owned media users. Version 4.0 in 2024 can provide different users with different personalized recommendations and has truly realized the integration of Customer Data Platform (CDP) and Marketing Automation (MA). In 2024, the personalized recommendations were launched. The data monitored during the launch stage showed a fivefold increase in conversion rate and a 30%–40% increase in repeat purchase rate.
A National Brand Rising from Quality and Trust
In 2009, based on years of industrial experience and resources accumulated by Winner Medical in the medical consumables sector, Li Jianquan founded Purcotton, starting the "business of a cotton flower". After experiencing the waves of mobile internet and consumption upgrades, true gold starts to appear. Fifteen years later, Purcotton has become a well-known national consumer brand.
Purcotton was born and grew in the era of the digital economy. Its development is a microcosm of China's digital economic growth. However, attributing its success primarily to the support of the times would be an oversimplification. In 2024, amid a global economic downturn and sluggish consumer demand, many Chinese brands that rose alongside Purcotton faced significant operational pressure, but Purcotton still achieved performance growth even in such a harsh environment.
According to the financial report of Winner Medical, its consumer product business (that is, Purcotton's business) achieved a cumulative operating income of CNY 4.99 billion in 2024, with a year-on-year increase of 17.1%. In the first quarter of 2025, it increased by more than 20% again, and the number of its full-domain members exceeded 61 million.
Not long ago, Professor Li Xi from the University of Hong Kong visited Purcotton and Tencent Cloud for research, and had an in-depth conversation with Xu Xiaodan, CIO of Winner Medical and Purcotton, trying to discover the secrets behind Purcotton's ability to consistently navigate economic cycles from its development process and digital transformation for providing pathways and case references for more enterprises.
Business Starting with a Cotton Flower
As a "world factory", China does not lack any raw material, technology, or supply chain required to produce high-quality goods, but it lacks brands that are recognized and trusted by its people. For the then well-off families, purchasing imported goods seemed to be the only choice if they wanted to improve their quality of life. The demand for imported goods once gave rise to a large number of professional purchasing agents and overseas shopping platforms.
"China's supply chain is actually very strong, and Chinese manufacturing ability is also very strong. Why do our Chinese people need to go abroad to buy baby and maternal products when they are pregnant or have babies? I want to create a brand that Chinese people can trust."
— Li Jianquan, Founder of Winner Medical
At that time, with more than 20 years of accumulation in the sector of medical consumables, Winner Medical had already established a good reputation for technology, quality, and industrial chain in cotton products. To bring safer products into people's daily lives, Li Jianquan decided to transition from medical to civilian use. Thus, Purcotton, focusing on cotton daily necessities, was born.
Choosing the "Stupid" Path: Quality Over Speed
Transitioning from the B2B medical consumables sector to the B2C FMCG (fast moving consumer goods) sector, Purcotton also had to feel its way forward. Since 2009, the mobile internet wave surged fiercely, and the air was filled with the smell of "hot money". According to the prevailing logic at that time, Purcotton should have taken the franchise route and rapidly opened hundreds or thousands of stores across the country. This would have made it generate impressive revenue data, attract venture capital (VC), and rise in the capital market.
However, Purcotton chose a very "stupid" path: self-operation, expanding cities one by one, and opening stores in one shopping mall after another. Under the self-operation mode, the rent for a single store plus initial investment could reach millions of yuan. Many investors didn't understand this mode, but Li Jianquan had his own convictions: "Quality takes precedence over profit, brand over speed, and social value over enterprise value." Only self-operation can maintain consistent quality. Facing the conflict between brand building and speed, Purcotton chose the former.
- Quality takes precedence over profit
- Brand over speed
- Social value over enterprise value
- Self-operation to maintain consistent quality standards
- Expanding cities one by one with careful planning
Due to its asset-heavy mode, Purcotton was in a loss-making state until 2014. However, after enduring these 4 years of initial investment, Purcotton began to show its brand momentum. At that time, China's economy was growing rapidly, and the demand for consumption upgrades among the middle-to-high income groups cultivated in the past thirty years became evident.
This demand can be observed by a set of industry data: In 2013, the market demand for soft cotton tissues in China was only 240 million sheets, but by 2019, it surged to 23.26 billion sheets, a hundredfold increase in just 6 years. Through high-quality products and services, Purcotton quickly met the demand of these middle-class families for a quality life. By 2018, Purcotton's annual revenue had reached nearly CNY 3 billion.
Looking back at the success of Purcotton at this stage, we can see several characteristics: grasp of opportunities of the times, persistence in quality, determination to invest, and steady operation, instead of pursuing quick success. These characteristics will continue to accompany Purcotton during its development process.
Proactive Planning and Rapid Digital Iteration with Small Steps
Despite revenue growth, subtle warning signs emerged in more detailed financial indicators. "Sales scale grew, but inventory costs increased, and gross profit and net profit declined. Behind the growth, some operational indicators failed to keep up," said Xu Xiaodan, CIO of Purcotton.
During the period of rapid development of Purcotton, a large number of Internet-famous brands surged rapidly. They disrupted the market with lower-quality, lower-priced alternatives through innovative marketing strategies. Visually, these alternatives seemed indistinguishable from Purcotton's products. To compete with these Internet-famous brands for traffic, Purcotton had to spend money to buy traffic and engage in price wars. Ultimately, the overall sales increased, but the purchased growth was unsustainable.
To reverse this unhealthy growth model, Purcotton decided to embark on a comprehensive digital transformation, exploring additional profit margins through digitization. "To achieve a leading market share in bestsellers, to improve sell-through rates of new products, and to enhance product gross profits, we need digitization to provide a series of processes, data, and operational means for support," said Xu Xiaodan.
The Partnership: Tencent Marketing Cloud Emerges
In fact, this "proactive planning" approach is ingrained in Purcotton's corporate DNA. Li Jianquan, founder of Purcotton, consistently monitors market trends and is willing to invest in technologies and innovations that could shape the future. As early as 2005, when the revenue of Winner Medical was less than CNY 1 billion, Li Jianquan was already willing to allocate over CNY 10 million annually for enterprise informatization. "This was a considerable expense relative to our company's scale at that time. It demonstrated that our management was very willing to try digitization and new technologies that could improve our enterprise management level."
Around 2018, on the eve of the industrial internet transformation, Li Jianquan keenly sensed the impending transformation. He realized that digitization could be a crucial tool for Purcotton to build its core competitiveness in the next stage. Therefore, Purcotton embarked on its transformation, upgrading its original IT Department into a Digital Operation Center and initiating comprehensive digitization from top to bottom. Although this was a long-term job, Purcotton had an urgent need at that time: to find a partner capable of establishing a CDP and MA system, while integrating data and staying close enough to users. It was under these circumstances that Tencent entered Purcotton's field of vision.
At that time, integrating CDP and MA was not required by Purcotton only. Recognizing this opportunity, Tencent integrated its CDP and MA capabilities. Based on the underlying capabilities of Tencent Cloud and global traffic ecosystems such as WeChat, the Tencent Smart Retail team provided a highly competitive product solution, that is, Tencent Marketing Cloud. The two sides reached an agreement and decided to give it a try.
"To be honest, we were not so confident about Tencent's B2B capabilities initially. Although it excels in social media and gaming, we were uncertain about its B2B services then. However, through this collaboration in CDP-MA integration, Purcotton saw Tencent's determination and capabilities in enterprise services."
— Xu Xiaodan, CIO of Purcotton
In 2020, the two sides began formal cooperation, and after one year, jointly developed and launched Tencent Marketing Cloud 1.0.
From Version 1.0 to 4.0: Rapid Iteration with Small Steps
In the process of digital transformation, Purcotton's actions can be summarized as firm confidence, long-term investment, and rapid advancement with small steps. Unlike many enterprises that start their transformation with the construction of a large middle platform, Purcotton pays more attention to iterating step by step according to its actual business requirements. Tencent Marketing Cloud has evolved from version 1.0 in 2021 to version 4.0 in 2024. Version 1.0 focused on unifying the IDs of 28 million owned media users. Version 4.0 in 2024 can provide different users with different personalized recommendations and has truly realized the integration of CDP and MA.
- Version 1.0 (2021): Unified IDs of 28 million owned media users
- Version 2.0: Enhanced data integration across channels
- Version 3.0: Improved audience segmentation and targeting
- Version 4.0 (2024): Personalized recommendations and full CDP-MA integration
"We often communicate with our peers in the industry. We generally encounter the problem that our investment in digitization is not in direct proportion to the returns. If the initial investment is not directly reflected in the operational indicators, many companies will hesitate: Should I continue? We are quite firm in that we will continue. It may not bring you immediate benefits, but it is a long-term cornerstone project."
— Xu Xiaodan, CIO of Purcotton
Digital Products Gradually Becoming Mature: Time to Reap
Now, Purcotton is beginning to reap the benefits from its early investments in digitization. In 2024, when the industry lamented the consumption downgrade and business operation difficulties, Purcotton still maintained a double-digit growth rate. Digitization was one of the driving engines of the growth. "This year (2024), the personalized recommendations were launched. The data we monitored during the launch stage showed a fivefold increase in conversion rate and a 30%–40% increase in repeat purchase rate."
- 5x increase in conversion rate through personalized recommendations
- 30-40% increase in repeat purchase rate
- Over 400 customer classification types for refined operations
- Double-digit growth maintained in 2024 despite market challenges
In terms of the granularity of customer profiles, Purcotton has classified customers into more than 400 types, enabling refined operations based on their potential needs. For example, products like underwear and socks are often associated with loungewear purchases. Purcotton recommends underwear or socks to users within 15 days after they purchase loungewear. For another example, community stores and office-building stores cater to totally different customer groups. This requires different product structure adjustments, and product displays must also be adjusted according to customer movement patterns on weekdays and weekends. It is through this refined operation that Purcotton has achieved business performance growth against the consumption downgrade.
IT is Business, Business is IT
It is worth noting that, for the digital transformation, Purcotton abandoned technology worship and followed one principle: IT is business, and business is IT. If a technology cannot support business or promote the formation of action decisions, it has no value. Guided by this principle, Purcotton implemented a job rotation system, allowing business personnel to do IT tasks and IT personnel to do business tasks. All digitization projects were designed around business processes and business logic, avoiding a disconnect between business and digitization. In this way, the data collected from each touchpoint can truly support the enterprise's action decisions.
Case Study: Reclaiming Market Share in Soft Cotton Tissues
In 2024, relying on its deep insight into users and the decision-making and action advantages brought by internal integrated operations, Purcotton achieved a remarkable victory. Soft cotton tissues, a product category created by Purcotton and one of its three bestsellers in the early days, had ranked No. 1 in the market for seven or eight years. However, in subsequent years, the market share that originally belonged to Purcotton soft cotton tissues was eroded by some "soft tissues" with lower costs and prices.
"Why were these users lost?" Purcotton asked itself. The User Research Department identified a group of former loyal users of its soft cotton tissues from its member pool and conducted in-depth interviews with them. The findings revealed that these members were unaware that soft cotton tissues and "soft tissues" are fundamentally different things, even though they differ by only one character in Chinese. "They think that the soft cotton tissues priced CNY 15 and the "soft tissues" priced CNY 5 are the same thing and of the same quality, so they tend to choose cheaper ones."
After finding the reason, Purcotton launched a popular science event themed "Cotton and Non-Cotton," using omni-channel material introduction and purchase guides to help consumers truly understand the benefits of cotton. At the same time, Purcotton also conducted targeted information dissemination and user outreach. Ultimately, during the 2024 Double Eleven shopping festival, the market share of Purcotton's soft cotton tissues returned to 70%, achieving a significant lead. This is a textbook case of using user in-depth insights to form a decision-making basis, implement the decisions, and achieve remarkable success.
The Core Value of Tencent Marketing Cloud 4.0
For Xu Xiaodan, the core value of Tencent Marketing Cloud 4.0 is that it can better understand users based on the tags of "people", "products", and "scenarios". For example, it identifies which topics they care about, which channels they prefer to buy products, what types of products they like to buy, and which conversions may follow a type of purchase. "The most special ability brought to us by Tencent Marketing Cloud 4.0 is that the group tags are very clear, enabling precise matching of outreach topics and product recommendations."
- Clear group tags based on people, products, and scenarios
- Precise matching of outreach topics to user interests
- Product recommendations aligned with purchase patterns
- Understanding of preferred channels and purchase behaviors
- Prediction of conversion pathways and next purchases
Looking Ahead: Version 5.0 and Beyond
In the strategic layout of deepening user operations, Purcotton's marketing cloud system, developed in collaboration with Tencent, has been iterated and upgraded to stage 5.0. "The deep collaboration with Tencent Marketing Cloud has enabled us to break through the traditional user understanding boundaries and discover new value growth poles in a seemingly mature operating system." Xu Xiaodan emphasized. This upgrade of the operating paradigm based on intelligent insight will continuously drive enterprises to build more predictable service systems, enabling enterprises to always focus on users and open a new chapter of quality service during in-depth exploration of user lifecycle value.
"The deep collaboration with Tencent Marketing Cloud has enabled us to break through the traditional user understanding boundaries and discover new value growth poles in a seemingly mature operating system."
— Xu Xiaodan, CIO of Purcotton
