In the Wuling Mountain area at the junction of Hubei and Chongqing, a traditional herbal processing enterprise named “Youyoucao” is quietly emerging as a case study for digital transformation in regional economies. While most small and medium-sized enterprises are still struggling with “traffic anxiety” and “channel bottlenecks,” Youyoucao Hubei-Chongqing Company has carved out a path from a deep-mountain workshop to an internet brand over three years. Behind this journey lies not only a company’s self-rescue but also a true reflection of the battle for traditional industries in central and western China amid the digital wave.

The story begins in 2020. At that time, Youyoucao had hundreds of acres of planting bases at the border between Enshi, Hubei, and Wanzhou, Chongqing, focusing on traditional herbal products like mugwort and honeysuckle. Founder Old Zhou recalls that products were mainly sold through offline wholesale and referrals from acquaintances. “We barely made a living year-round, and when market conditions were bad, goods would pile up in the warehouse.” The turning point came during a chance e-commerce training session. Old Zhou discovered that similar products were selling astonishingly well on platforms like Pinduoduo and Douyin, while his own products, despite being of comparable quality, were shut out of the market due to a lack of internet know-how.

The internet transformation of “Youyoucao Hubei-Chongqing” was not simply about “opening an online store.” Old Zhou’s first move was to revamp the product format. Traditional herbal products were often sold in bulk or simple packaging, unsuitable for e-commerce logistics. The team redesigned small-dose, sealed packaging and introduced fast-moving consumer goods like “health tea bags” and “mugwort foot bath bags” targeting younger consumers. At the same time, a 12-person e-commerce operations team was set up across Hubei and Chongqing, specializing in content shooting, livestream sales, and data analysis. This adjustment allowed Youyoucao’s products to achieve a single-day sales record of over 100,000 yuan for the first time during the 2021 Double 11 shopping festival.

An even more critical step was brand-driven operations. Old Zhou realized that merely selling products could not build a competitive moat. Youyoucao began to leverage the value of the “Hubei-Chongqing” regional label—the high altitude, pollution-free environment, and traditional cultivation techniques of the Wuling Mountains became the core of its brand narrative. On Douyin and Kuaishou, the team produced numerous short videos featuring “herb gatherers” and “ancient processing methods,” even inviting local intangible cultural heritage inheritors to appear on camera. This earthy, rustic content unexpectedly garnered high click-through rates. In 2022, a video showcasing the entire process from mugwort planting to finished product exceeded 5 million views, directly boosting the store’s follower count to 200,000.

However, the internet journey was never smooth. In 2023, Youyoucao faced a double blow from soaring traffic costs and changes in platform rules. Old Zhou admitted: “Previously, investing 10,000 yuan could bring in 50,000 yuan; now, investing 10,000 yuan just to break even is considered good.” Faced with the dilemma, the team did not blindly burn money but shifted to private domain operations. They used enterprise WeChat to consolidate core customers, launching a “membership system plus customized services,” such as offering exclusive formula tea bags for long-term users. Meanwhile, leveraging the logistics advantages of both Hubei and Chongqing, they compressed delivery time to within 24 hours, boosting the repurchase rate by 30%.

Today, Youyoucao Hubei-Chongqing Company has grown from a 3-person workshop to a team of 50, with online sales accounting for over 70% of total revenue, and products reaching markets in southern and eastern China. More notably, its model has begun to drive surrounding farmers—through an “internet plus cooperative” approach, the company has signed guaranteed purchase agreements with over 200 herb farmers and provides free planting technical guidance. Early this year, the local government designated Youyoucao as a “Digital Demonstration Project for Rural Revitalization” and plans to replicate its experience for other specialty agricultural product enterprises.

Reflecting on this journey, Old Zhou repeatedly used one word in interviews: “trial and error.” “There is no universal formula for the internet, especially for small businesses like ours. We can only explore and adjust as we go.” The story of Youyoucao may serve as a microcosm of countless regional small and medium-sized enterprises in China undergoing self-iteration in the internet era—not marked by earth-shattering technological revolutions, but by continuous micro-innovations and grounded execution. As more and more “Youyoucaos” make their way from the mountains to the screen, the internet DNA of central and western industries truly begins to take root.