Online beauty company Guangzhou Yatsen launched the Perfect Diary brand in 2016, and it has taken off: In July, Perfect Diary raised an undisclosed amount of new funds, led by investment management firm Hillhouse Capital, reportedly lifting the brand’s valuation to $1 billion. During last year’s annual Singles’ Day shopping festival, Perfect Diary outpaced far better-known competitors such as L'Oréal to become the first brand to reach ¥100 million (around $14 million) in one-day sales – and took only one hour 28 minutes to hit that mark, according to Tmall. Even more impressive given it was the brand’s first time to join the shopping festival. Perfect Diary: The Billion-Dollar Brand Perfect Diary focuses on cosmetics, including foundation, eye makeup and makeup remover. The trendy brand boasts minimalist, sleek products at affordable prices: from ¥39 (around $5.5) to ¥100 (around $14). Products are tailored to Asian skin types. Perfect Diary Targets Gen Zers Perfect Diary targets Gen Zers — often defined as those born after 1995 — by launching a series of innovative color cosmetic products that appeal to young consumers looking to express themselves. For example, the brand collaborated with the British Museum to create two eye shadow kits inspired by Italian Renaissance tin-glazed maiolica art. The collaboration generated $1.3 million in sales on Single’s Day 2018, according to Perfect Diary. [caption id="attachment_97230" align="aligncenter" width="700"] Perfect Diary x British Museum eye shadow kit
Source: Company website[/caption]   To appeal to Gen Zers, the brand also signed popular idol and lead singer of Chinese band NEX7 Zhu Zhengting as a brand ambassador for its lipstick products. [caption id="attachment_97231" align="aligncenter" width="700"] Perfect Diary brand ambassador Zhu Zhengting
Source: Company website[/caption]   Focus on Social Media Marketing and Consumer Engagement Perfect Diary poured on resources to cultivate a strong social media presence on platforms such as WeChat, Little Red Book and Weibo. As a result, average views of headline posts published by the company on its WeChat account surpassed 100,000, according to a report released by Tmall in November 2018. Perfect Diary also hired key opinion leaders (KOLs) to promote the brand, several prominent ones (with more than 100,000 followers) and many more influencers with fewer followers. A top-tier KOL charges ¥7,000 (around $984) per post, 14 times more than the lowest-tier ones, according to Little Red Book. Perfect Diary also uses Little Red Book’s content distribution algorithm that lets users see posts in the news feed that are generating high levels of engagement, even from accounts they do not follow. Perfect Diary leveraged KOLs at all levels, from hugely popular ones with huge fan bases to more niche KOLs with smaller followings – but who may actually do better at engaging followers. Now, Perfect Diary has one of the most-followed company accounts on Little Red Book with 1.71 million followers and 2.1 million likes as of September 24, 2019, according to Little Red Book. [caption id="attachment_97232" align="aligncenter" width="700"] Perfect Diary Little Red Book page
Source: Little Red Book[/caption]   What Can International Brands Learn from Perfect Diary’s Meteoric Rise? International cosmetics brands can also leverage Little Red Book for marketing. The layout and design of Little Red Book posts makes the social media platform a perfect place for cosmetics brands to showcase their products: colourful pictures with short and to-the-point messages. For instance, KOLs and users can post pictures of product trials and comparisons of different color shades. [caption id="attachment_97233" align="aligncenter" width="700"] Posts of product trials and comparison of different color shades with short messages
Source: Little Red Book[/caption]   International brands can also post to Little Red Book to support Taobao sales: Around 14% of Taobao users look at Little Red Book reviews before ordering products from Taobao, according to Little Red Book. Key Insights Cosmetics have become one of Tmall’s best-selling product categories, with sales growth exceeding 60% year over year in 2018, well above the average rate of growth for all skin care products, according to Tmall. Perfect Diary is tapping into this trend, using a creative product development strategy to target Gen Zers. Social media investments further drive consumer engagement.