Social Media
XiaoHongShu (小红书), literally translated as “little red book” in Chinese, is a social e-commerce app based in Shanghai, China. Created in 2003, it has gained widespread popularity among Chinese customers. In June 2018, the platform raised $300 million in its Series D of founding led by Alibaba.
Xiaohongshu makes up 5.6% of the total cross-border e-commerce market and plays a leading role in Chinese cross-border e-commerce.
The app has generated sales totalling 700 million yuan (about $ 109 million) in the first six months of the year.
The majority of Xiaohongshu users are female (88%), and more than 60% are 30 years old or younger.
Nearly 57% of users live in top-tier cities and have relatively high consumer power. The platform has become the ideal channel to attract young, affluent female shoppers that have the desire and means to buy products from overseas.
Unlike Weibo, which is based around microblogs and short comments, Xiaohongshu encourages its users to write long product review articles, known as Notes. Like-minded consumers gather here to write reviews on recent products they bought and share accounts of shopping experiences. As its name suggests, the platform acts as a reference book that users can consult prior to shopping, and add their own experience in order to expand and enrich its content.
Various topics are covered by Notes: which new colors of lipsticks you can’t miss, how to dress properly for specific occasions, the best place for tourists to dine in Paris, the best time of the year to shop for unbeatable deals.
Relationships between users of Xiaohongshu are built around their common interests. The experiences shared by users help to develop trust between customers and brands.
Xiaohongshu has three sections on its main page:
Having attracted a strong base of like-minded users, Xiaohongshu succeeded in introducing an e-commerce element into its social platform.
When creating a Note, users usually provide an e-commerce hyperlink related to the product discussed. In this sense, a natural transition between content consumption and e-commerce is established.
Upon opening Xiaohongshu, it is common for customers to search for information on foreign fashion products and read reviews submitted by KOLs and other users. Having conducted the research, they can then decide on a product and access the brand page by hyperlinks to directly buy the product from Xiaohongshu.
The conversion rate of Xiaohongshu users who place an order for a product they read about on a Note is as high as 8%. In comparison, the conversion rate on Tmall is only 2.6%.
There are several possible marketing strategies brands can adopt on the platform. For products listed on its e-commerce platform, Xiaohongshu can organize countdown sales. As the marketing on Xiaohongshu is driven by word-of-mouth, the most important strategy for foreign companies are KOL campaigns.
If an influencer with a large number of followers on Xiaohongshu shares positive feedback of a product—or range of products—it can greatly benefit the brand; improving their image, reputation and sales.
The famous Chinese actress Fanbingbing has 10.6 million followers on Xiaohongshu. She likes to share tips of skin care for young girls who dream to have her complexion. Every face mask recommended by Fanbingbing on the platform is reportedly sold out. Even the actress has complained that she can’t find her favorite brand on the store.
There are three principle methods when it comes to KOL marketing on Xiaohongshu. Companies can:
As for a budget, Xiaohongshu charges brands a sizeable 15-20%. On top of this, a third party helping to run campaigns will often charge an additional percentage of sales.
In all, Xiaohongshu distinguishes itself from the fierce competition between a great number of cross-border platforms by its well-targeted clientele (an urban female population between 18 and 35 years) and the combination of social and e-commerce features. The best marketing strategy for foreign companies on Xiaohongshu is to launch a KOL campaign.
If you want to develop your brand’s presence in the Chinese market, Xiaohongshu’s unique features make it an option you can’t afford to miss.
