The relationship between design and culture has undergone significant transformations over the past century. The digital era presents a fascinating perspective between cultural preservation and product design innovation. This study investigated the interplay between cultural preservation and product design innovation in the digital era. Participants (n=45) were recruited in Shanxi Province, China, with a mix of demographics and varying levels of craftmanship experience. The study employed a mixed methods approach, combining quantitative and qualitative data collection methods. The findings showed positive sentiment towards traditional cultural elements incorporated into modern products. Participants expressed a desire for products that connect them to their cultural heritage while maintaining a preference for subtle integration and everyday use. Cultural heritage specialists emphasized the importance of balancing tradition and innovation while ensuring respectful modernization and incorporating storytelling. The case study analysis of the "Heaven and People in One" exhibition showcased the potential of collaboration in fostering innovative and successful product design that celebrates cultural heritage. Overall, this study suggests a growing interest in products that bridge the gap between cultural preservation and contemporary design.