Digitally China: RED (aka Xiaohongshu) and the Ups and Downs of Social E-Commerce

Companies around the world are latching onto social commerce, but in China, where mobile payments are ubiquitous and consumers are extra wary of fake goods, the integration between social media and online shopping has been especially fast.

That doesn’t mean it’s a silver bullet for brands though — or even for the multi-billion dollar internet celebrity industry, where influencers are tasked with advertising products without appearing too commercial.

Xiaohongshu Social Commerce China

In this episode of Digitally China, we’ll discuss Xiaohongshu (or RED to give it its official English name), which is often compared to Instagram and Pinterest.

The fast-growing app, which is popular among young, female urbanites in China, has over 85 million monthly active users and is valued at 3 billion USD following a 300 million USD funding round last year led by e-commerce heavyweight Alibaba.

But the e-commerce side of RED is still behind more price-conscious competitors like Pinduoduo — and the app hit its latest roadblock earlier this week, when it was pulled from Chinese app stores.

We’ll cover some of the challenges the app is facing as it tries to grow its e-commerce business — monetizing its vibrant user community — and manage the thousands of influencers on its platform.

Episode summary

  • Xiaohongshu backstory and introduction
  • Xiaohongshu vs competitors
  • Xiaohongshu’s content quality problem
  • Success cases of brands working with influencers
  • Cosmetics: an industry where Chinese brands have really optimized social media and e-commerce

Guests

  • Elijah Whaley, chief marketing officer at Parklu, an influencer marketing tech firm in China
  • Huo Qiu, a fashion and cosmetics influencer with over 1 million followers on Weibo and about 30,000 followers on Xiaohongshu

Listen to the latest Digitally China episode below or find it (and previous episodes) on iTunes here.