How does Xiaohongshu do social e-commerce? Weibo + Tmall?

Last year, a top French jewelry brand conducted a small survey. We asked stores across the country (less than ten in total) to ask customers who came to buy jewelry with credit cards: "How did you know about our new products?" The results were surprising: 90% of the feedback collected by the stores mentioned " Little Red Book ".

What is Xiaohongshu? The People's Daily has a summary: Amazon + Instagram.

Xiaohongshu recently announced that it is seeking the next large round of financing .

This niche, high-priced, and high-end jewelry brand has begun to include Xiaohongshu in its monitoring scope.

Fan Bingbing and Lin Yun have transformed into beauty bloggers on Xiaohongshu, often selling out certain facial masks and beauty devices. Brands also have doubts: Does Xiaohongshu have too many soft articles today? Do users still trust the recommendations of Xiaohongshu celebrities ?

01

In China, Xiaohongshu belongs to " social e-commerce ": it consists of two parts: one is "community", sharing shopping experiences; the other is "e-commerce", selling goods to you. In China, perhaps it can be understood as: Weibo + Tmall .

In the community, users post all kinds of experiences: reviews of newly purchased items, the excitement of buying limited editions, and a series of guides on where to go, what to do, and where to stay when traveling abroad.

As a reader, you can see and search all the above information. Similar to Weibo, you can follow authors, comment on posts, like them, and collect them.

The other part is Xiaohongshu’s own shopping mall, which sells everything from cosmetics, facial masks, beauty devices to snacks, pajamas and diapers.

E-commerce and community are closely related. Community recommendations and discussions will stimulate users' shopping impulse. If the product is available in the Xiaohongshu mall, they will place an order. The choice of brands to enter the mall can also be determined based on the popularity of community discussions.

In 2013, Qu Fang, who graduated from Beijing Foreign Studies University, left Bertansmann and started a business with his good friend Mao Wenchao. They chose to locate their company in downtown Shanghai, and in December, "Little Red Book" was launched. At that time, there were already products such as Mogujie and Meilishuo , which were communities for female users to share fashion and shopping information - they all wanted to be Amazon + Instagram.

In the early days, Xiaohongshu’s customer community had strong purchasing power and high quality, and it gradually took the lead among its competitors that started at the same time.

From 2015 to 2016, Xiaohongshu CEO Mao Wenchao shared the user characteristics of Xiaohongshu in multiple venues: 70% to 80% are women, aged between 18 and 30, mostly students and white-collar workers; 50% are users in first-tier cities. Most of the relatively elite people have the ability to travel and shop abroad, or at least have the desire to shop overseas, that is, "white, rich and beautiful".

As soon as it went online, Xiaohongshu created a "Hong Kong Shopping Guide". At the end of 2013, Hong Kong was the most popular outbound destination. During the Christmas discount season, the "Guide" became a hot item. This is how many initial users came. As these users traveled around the world, the content on Xiaohongshu gradually included Japan, South Korea, Singapore, the United States, Europe, and the whole world.

The content format of Xiaohongshu is called "Notes". Unlike seller descriptions on Taobao , these notes are from the buyer's perspective.

For example, a skin care product note would talk about your skin type, the combinations and feelings of the products used, etc. It’s more like your little sister is “recommending” you, and you are more willing to trust the recommended products and content. No matter how hard the seller promotes his product, it cannot compare to word of mouth from passers-by. If it is recommended by a friend, there is no need to hesitate.

So, why would anyone spend the time and energy to write guides for others to read? The first is the natural desire to share luxury goods after purchasing them. Secondly, Xiaohongshu will emphasize liking, collecting and commenting in its user guide to help users form habits.

My personal experience is that when I occasionally open the app and see that I have received likes and collections, I feel a sense of accomplishment and am willing to continue writing for these numbers.

02

The content of the early Xiaohongshu notes mainly focused on beauty and bags. Gradually, people also started sharing notes about pets, job hunting , and travel.

Today, the opening message of Xiaohongshu has been changed from "Find great things from abroad" to "Mark your life". With a larger scope and more things to write about, Xiaohongshu may want to get more users' time. In the fashion circle, if you have good content and many users (women), people from all directions will immediately urge you to do e-commerce. After users write their product reviews, their comments are often filled with questions like “Please give me a link?” and “Where can I buy this?” Instead of asking users to open Taobao, Tmall and JD.com , it is better to sell by themselves. This is how Xiaohongshu started its e-commerce business.

In December 2014, Xiaohongshu launched its e-commerce function. Initially, it organized "flash sales" in the form of a "welfare club" with limited inventory and preferential prices, but they had to be snatched up.

The products that appear are those that have been mentioned many times in community notes, have low average order value, and are easy to consume repeatedly. Limited quantity - by controlling the initial inventory investment, Xiaohongshu tested the market. Until now, the "flash sale" activity is still placed on the first screen of Xiaohongshu's mall page.

After gradually becoming proficient in supply chain management, Xiaohongshu "adopted a self-operated B2C model, cooperated directly with overseas sources of goods, and established bonded warehouses in China." The risk of this model is that it requires buying out inventory in advance, which is when the guiding role of Xiaohongshu community content comes into play. Products with good user feedback are more suitable for introduction into the platform. At this time, the notes can add a built-in purchase link, which allows you to enter the purchase page with one click, and also increases the probability of converting reading into purchases.

Xiaohongshu's e-commerce sales are quite impressive. The official results include: at the end of 2015, Xiaohongshu had just launched its e-commerce function for half a year and achieved sales of 700 million yuan; during its anniversary celebration in June 2017, it sold 100 million yuan in two hours; in the same year, People's Daily reported on Xiaohongshu, stating that Xiaohongshu's sales in two years had exceeded 10 billion yuan.

Behind these beautiful numbers, there are also various hidden concerns. As long as you are doing e-commerce, there will always be people who question the authenticity of the goods. Then there are a lot of complaints. Users are always dissatisfied in one way or another. How to solve the problems and appease the users? The faster the development, the greater the pressure. Especially for the official B2C cooperation model, does this official refer to the brand official, or is it authorized by the buyer store or agent? There is also the issue of community content. As its influence expands, more and more big Vs appear on Xiaohongshu, and various commercial implants and soft articles have also arrived on the scene, causing users to gradually become cautious about "notes".

03

Xiaohongshu may be the place with the highest concentration of white, rich and beautiful women in the world. These "smart, white and adorable" people contribute a lot of high-quality content on Xiaohongshu. But they are also very "savvy": this means that for products in their own shopping malls, "smart white girls" have plenty of other channels to compare prices and buy - purchasing agents they already trust, friends, or even their own frequent flights.

Judging from various signs on Xiaohongshu, the platform pays more attention to people who read notes than those who write notes, because the latter contribute to sales. The latter are usually like this: they are more likely to come from second-tier and third-tier cities or fourth-tier and fifth-tier cities, and have limited knowledge of brands and purchasing channels; those born after 1995, who are in college or have just graduated, will yearn for the fancy life of KOLs on Xiaohongshu. They themselves do not have convenient channels to enjoy the same products and life. For them, Xiaohongshu, which represents the experience of "predecessors", can ensure that they keep up with the trend, maintain quality, and avoid detours.

In order to better attract these users, celebrities came: "Fan Bingbing teaches you how to draw lip makeup", "Lin Yun washes her face live ", such content attracted those girls who browse celebrity gossip on Weibo, search for "same style" on Taobao, and crazily cheer for idol trainees.

They went from reading notes on Xiaohongshu to shopping on Xiaohongshu, which boosted the performance of Xiaohongshu. However, some commentators believe that the addition of a large number of celebrities has reduced the exposure opportunities for ordinary users, which may lead to the loss of old users. Users with high average order value are difficult to serve and are savvy, while users with low average order value can bring in a large number of purchases but cannot support the sense of luxury that the brand wants.

Will the novelty of social commerce last? How does Xiaohongshu balance content and sales? Will there be bloggers on Amazon? I heard that Instagram has already started selling products.

The author of this article @卢曦面试笔记 is compiled and published by (Qinggua Media). Please indicate the author information and source when reprinting!

Product promotion services: APP promotion services, advertising platform, Longyou Games