Zhou Xiangshan, the vice president of Dong-E E-Jiao, said this strategy had significantly increased sales at the company, which manufactures supplements and functional foods using donkey hide gelatin.
Research suggests it can provide a range of benefits for bone health, immunity and better sleep.
Its high levels of collagen also make it suitable for anti-ageing products, he said.
Speaking at the Food and Beverage Innovation Summit in Shanghai, Zhou said: “There are two ways for Chinese companies to innovate. They can bring in the latest international trends or dive deeper into a treasure trove of Chinese medicine and heritage and combine this with today’s tastes.
“We take traditional products and use them for modern requirements across supplements and functional foods.”
He said the company had recently launched two products featuring donkey hide gelatin in the functional food space. One is a chicken broth which claims to aid immunity, the other is mixed with sour dates and claims to improve sleep.
It has also released a supplement in capsule form where it is teamed with iron and calcium.
“The gelatin helps the digestion of calcium and iron,” he said.
“All of these new creations are based on TCM recipes and are entirely compliant with the regulatory environment.”
He said the launches, combined with increased interest in TCM among younger consumers, had increased sales.
The firm, which employs more than 4,000 people, also saw exports rise to Korea, Taiwan, Hong Kong and several South East Asia markets.
Provenance and sound science is very important for growth, he said, adding the donkey hide gelatin must come from Dong’e County.
He also pointed to several published papers which highlighted the ingredients benefits.
One blot on the landscape, however, could be the steep rise in raw material costs.
“Many of our consumers pay close attention to the price hike of the raw material. Three years ago donkey hide gelatin cost RMB70 a kilo, now it is RMB500.
“This is because we have fewer donkeys. In the 1970s you saw them on the streets, now they are rare,” he added.