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The Best Guide To XiaoHongShu Marketing: How To Sell to Gen-Z & Millenials

Dragon Social > Marketing in China  > The Best Guide To XiaoHongShu Marketing: How To Sell to Gen-Z & Millenials

The Best Guide To XiaoHongShu Marketing: How To Sell to Gen-Z & Millenials

Have you ever heard of Pinterest or Amazon? For people from the west, most of them are used to buying products, sharing reviews and posting lifestyle stories through various platforms. Imagine all of those features wrapped in one and you’ll get XiaoHongShu (小红书)! XiaoHongShu (the Little Red Book in English) provides an all-in-one platform with both social media and e-commerce functions for its China users.

 

 

Launched in 2013, the social E-commerce app now has over 200 million registered users as of 2019. If you’re in the field of e-commerce, you should definitely learn how to master the platform created by this billion-dollar startup rapidly taking over China.

 

 

XiaoHongShu's logo

XiaoHongShu’s logo

 

 

Table of Contents:

 

 

The Success of XiaoHongshu As A Social E-Commerce Platform Read Now

 

 

What Makes XiaoHongShu So Special For Marketers? Read Now

 

 

Guide To Setting Up A XiaoHongShu Brand Account/Digital Store Read Now

 

 

5 Ways to Kickstart Your Marketing Journey On XiaoHongShu Read Now

 

 

The Success of XiaoHongShu As A Social E-Commerce Platform

 

 

Established in 2013 by Miranda Qu and Charlwin Mao, XiaoHongShu, which translates to the “Little Red Book”, began as an app for users to submit reviews and share overseas shopping tips with other users. 

 

 

With a focus on beauty and fashion, it acts a platform for people to post and share shopping tips, product reviews and lifestyle stories (in the form of pictures, videos and text). The platform has developed into a   trusted source for advice and recommendations from other users and like-minded people. It has successfully created a thriving community user interactions/engagement, careful curation, and authentic information sharing.

 

 

Noticing users’ demand for buying foreign goods, XiaoHongShu launched its own cross-border e-commerce platform, the “RED store” in 2014. It connects Chinese consumers with global brands by enabling users to buy overseas products directly through the app.  Since then, XiaoHongShu has formed strategic partnerships with many overseas brands including Lancôme, Swisse and Innisfree.

 

 

Lancôme, Innisfree and Swisse's brand accounts | Dragon Social

Lancôme, Innisfree and Swisse’s brand accounts

 

 
With the business model of a social e-commerce platform, XiaoHongShu achieved great success in recent years, especially in 2015, when it grew its GMV from approximately 1 million RMB to over 100 million in just 6 months

 

 

It’s continued growing and now has over 200 million registered users as of 2019.  In 2018 it’s topline revenue was RMB 1.49 billion and it projects to earn nearly RMB 3 billion in 2019!

 

 

Being one of the most popular e-commerce platforms in China, it provides an outstanding opportunity for foreign marketers who want to get into the massive China market.

 

 

What makes XiaoHongShu so special for marketers?

 

 

1) Young, High-Purchasing Power Demographic

 

 

According to its official website, XiaoHongShu has reached 200 million registered users as of Jan 2019, with those born in the post-90s and post-95s as the most active users. From statistics gathered by IResearch statistics, over 50% of users were under 30 years old, while more than 80% of them are female.

 

 

XiaoHongShu's User age distribution and gender split (Jan 2019) | Dragon Social

XiaoHongShu’s User Age Distribution and Gender Split (Jan 2019)

 

 

With young urban females who value quality as the main user demographic, XiaoHongShu serves as an effective platform for selling and advertising skincare, cosmetics and fashion products. Given that the app is extremely popular among China’s Generation Z, XiaoHongShu is an ideal marketing platform for brands who would like to target a young and sophisticated demographic.

 

 

2) Thriving Online Community

 

 

XiaoHongShu has successfully created an online interactive community through having their users share informative content including product reviews, OOTDs and make-up tips.

 

 

Apart from creating your own content, users can also “Save” posts, interact with others through “Likes”/”Comments”, or even press “Follow” to subscribe to a particular user/brand that they like. XiaoHongShu also lets users share posts externally through Weibo/Wechat (which is rare given how some platforms in China punish users for linking to rival platforms).

 

 

XiaoHongShu's "Like", "Save" and "Comment" buttons | Dragon Social

XiaoHongShu’s “Like”, “Save” and “Comment” buttons

 

 

XiaoHongShu's "Share", "Follow" and "Comment" functions | Dragon Social

XiaoHongShu’s “Share”, “Follow” and “Comment” functions

 

 

To maintain high-quality content,  XiaoHongShu doesn’t allow self-advertisement or verbal abuse. With an emphasis on “authenticity”, it further fosters trust and honest sharing among users by enforcing these policies. So much so that descriptions such as “No.1…” or “The best…” are strictly prohibited on all brand stores or advertising! 

 

 

Apart from sharing and commenting, Xiaohongshu uses a recommendation algorithm to create a customized homepage based on users’ browsing and search history. It also offers an “Explore” feature based on this same data.

 

 

This function allows users to focus on topics they are interested in and sort out unwanted information. “Nearby” shows hot topics according to user’s location, while “Follow” shows latest posts from subscribed accounts.

 

 

XiaoHongShu's "Explore" and "Nearby" interfaces | Dragon Social

XiaoHongShu’s “Explore” and “Nearby” interfaces

 

 

Thanks to its engaging features, XiaoHongShu has successfully built a tight bond among its like-minded users, lovingly calling themselves “小紅薯”(literally Little Sweet Potatoes in English).

 

 

According to its official website, XiaoHongShu had 30 million monthly active users in 2018, three times more than the previous year.

 

 

3) Extensive word-of-mouth marketing

 

 

The app’s user-generated content led to the emergence of several Key-Opinion Leaders (KOLs) becoming active on the platform. Similar to KOLs (Influencers) on Instagram, most of them share useful tips and interesting content about beauty and lifestyle. These KOLs work with brands to promote products to followers resulting in increased brand awareness, user engagement, and followers. 

 

 

Examples of XiaoHongShu influencers include Austin Li, nicknamed “KouHongGe” (The Lipstick Master/Brother; 口紅哥), who tries on luxury brands’ lipsticks such as Gucci and M.A.C. He has accumulated 3,169,800 followers and his comments are constantly shared by other lipstick lovers.

 

 

Austin Li has gained popularity on XiaoHongShu | Dragon Social

Austin Li has gained a huge following on XiaoHongShu

 

 

Apart from those who became famous after joining XiaoHongShu, some celebrities such as FanBingBing and Nana Ou-Yang, have also opened their own accounts on XiaoHongShu, which has helped to further boost the app’s traffic and credibility.

 

 

So how do KOLs foster WoM marketing? In fact, a single share from a user on XiaoHongShu already brings online exposure to your product. Once your product is shared by a user,  other users will be able to view details about its features, benefits and prices.

 

 

If other users find it attractive, they may even further share it within their social circle, with the possibility of it going viral! It significantly raises brand awareness and helps to generate customer leads.

 

 

FanBingBing's XiaoHongShu account and posts | Dragon Social

FanBingBing’s XiaoHongShu account and posts

 

 

Dubbed “The Queen of Sales”, FanBingBing has amassed more than 10 million followers on XiaoHongShu. She shares her beauty tips with her fans frequently. Her following is so active that every face mask she ever endorsed was sold out on the platform.

 

 

Other users also share products with the tag “FanBingBing TongKuan” which means “the same product that FanBingBing uses.” Her presence and activity on the platform has greatly shaped brand perceptions and boosted sales.

 

 

Her endorsements have now taken on a life of their own with users sharing products long after the initial campaigns were over, which is a classic example of WOM marketing on XiaoHongShu.


 

 

4) Direct Link to An E-commerce store: Closing the Loop

 

 

XiaohongShu brought its app to the next level by launching an e-commerce platform, called “RED store, which allows users to purchase the products directly from merchants after reading reviews. With the store, users no longer need to worry about the authenticity of the products (a huge concern in China’s e-commerce industry!)

 

 

The feature greatly reduces consumers’ search and time cost, and further encourages the “Read-Like-Buy” cycle within the app.

 

 

XiaoHongShu's RED store's interfaces | Dragon Social

RED store’s interface

 

 

Users can tag products mentioned in the post | Dragon Social

Users can tag products mentioned in the post

 

 

For brands, they can set up an official account/digital store to sell products and interact with customers, which is an effective way to boost market awareness and sales. XiaoHongShu provides brands with full logistics, customer services and marketing support including data insights and in-app advertisements.

 

 

Apart from brand stores, XiaoHongShu operates its own store “FuLiShe” (福利社), “XiaoHong Dian” (小紅店) and “REDelight” (有光) to sell products authorized by different brands. To increase the variety of goods, third-party retailers/dealers are also welcomed.

 

 

L'Oreal's official digital store and brand account on XiaoHongShu | Dragon Social

L’Oreal’s official digital store and brand account on XiaoHongShu

 

 

And now, let’s make sure you know how to set up a XiaoHongShu brand account/digital store. Read on below for  our step-by-step guide. For those who would like to set up a user account, check How To Master XiaoHongShu (From a User’s Perspective)

 

 

Guide to Setting up a XiaoHongShu Brand Account/Digital Store  

 

 

1) How To Set-Up An Official Brand Account

 

 

1) Log in to the platform using your original XiaoHongShu user account.

 

2) Submit necessary documents for verification.

 

3) Get Verified! (XiaoHongShu will process your application in 3 days)

 

 

Basic Documents & Information Required for Overseas Companies

  1. Account name
  2. Company Name, Description, Location, Industry
  3. Company trademark/logo
  4. Company Authentication Letter (downloadable on XiaoHongShu’s website)
  5. Business registration (BR) or Certificate of incorporation (CR)
  6. Trademark Registration Certificate
  7. Name and contact of intended Account Operator/Business representative

 

*If you can read Chinese check out this document for more information

 

 

Log in page at: ares.xiaohongshu.com | Dragon Social

Log in page at: ares.xiaohongshu.com

 

 

2) How To Set-Up A Digital Store

 

 

XiaoHongShu provides two options for businesses who want to sell their products through the platform – to let XiaoHongShu pre-purchase products from you or open your own brand store. The following steps walk you through the process of opening a brand store.

 

 

*XiaoHongShu currently doesn’t accept individual sellers. 

 

 

1) Registration

 

Register on XiaoHongShu’s enterprise system, then log in with your registered email (must be a company email) and default password.

 

 

2) Fill in registration information

 

Fill in company information, financial information, details about the online shop and related documents for proof.

 

 

3) Qualification review

 

XiaoHongShu will review the submitted information and process your application.

 

 

4) Sign the contract

 

You can sign the agreement online. After checking, XiaoHongShu will send you an original paper contract. Please remember to sign it and send the contract back.

 

 

5) Complete the training

 

You can open an online store and gain access to the enterprise management system after completing the training provided by XiaoHongShu!

 

 

 

 

Basic Documents Needed For Overseas Companies (including Hong Kong, Macau and Taiwan Companies)

 

Company Information:

Contact information of Intended Operator of the store

Business address (where the contact and invoice would be sent to)

Trade Model (Domestic Trade/ Cross-Border Trade)

Delivery Region

 

Company Qualification:

Business registration/Certificate of incorporation/Other company registration file

 

Financial Information:

Bank name and account number

Bank address

Billing Currency

Additional information for overseas bank (SWIFT CODE/IBAN)

*Fill in contact number of the financial representative if the bank address is in South Korea

 

Brand Information:

You must choose whether you are operating a “Single brand” or “Multi-brand” store. For example, choose “Multi-brand” shop if you are a retailer/dealer, choose “Single brand” if you are the brand owner/exclusive distributor. XiaoHongShu doesn’t accept retailer/dealer selling single brands.

 

Brand Name

Country

Official Store Name (For Multi-brand shop)

Link to Tmall official flagship store (optional)

Brand introduction (<30 characters)

Brand description (<140 characters)

Brand Logo (750*750 pixels, not exceeding 5M, jpg or png)

Brand promotional banners (maximum 9 pictures with 750*560 pixels, not exceeding 5M, jpg or png)

 

Brand Qualification:

For “Single brand” store (flagship store/exclusive store):

Trademark Registration Certificate

Application letter for establishing a new store, with brand’s official seal (flagship store)

Authorization letter issued by the brand owner, with brand’s official seal (exclusive store)

 

For A “Multiple brand” store:

Application letter for establishing a new store, with brands’ official seal

Authorization letter issued by the brand owner, with brands’ official seal

 

March 2019 Update:

 

The Chinese gov ernement recently published a new E-Commerce law, requiring all cross-border ecommerce merchants to be linked with a Chinese entity. The company has released detailed requirements on their website regarding this new requirement, and all shops already opened without a designated Chinese entity will be frozen after April 5th if the information is not provided.

Merchants are required to provide the following documents from their associated Chinese entity:

  1. Business License
  2. Customs Registration License
  3. Authorization Letter from the Merchant designating the Chinese Entity
  4. Letter Of Consent from the Chinese Entity

 

 

XiaoHongShu develops an extensive delivery network | Social Dragon

XiaoHongShu has developed an extensive delivery network

 

 

Logistics, fees and other issues

 

XiaoHongShu provides customer service and full logistics support for partner brands. It has developed an extensive logistics network of 7 global fulfillment centers, 10 transportation hubs and 9 import clearance centers across 29 countries.

 

 

Products will be kept in their own warehouses for additional quality assurance, which would be shipped directly to buyers once an order is placed. Businesses who create their own digital stores will be charged a small fee and plus commission of around 5% per sale.

 

 

5 ways to kickstart your marketing journey on XiaoHongShu

 

 

1) Manage your own official brand account and store

 

 

Businesses can open their own official brand accounts to enhance the brand experience. They can build connections with customers through posting content, replying to customers’ inquiries, and launching promotional campaigns.

 

 

Colourpop's "Posts", "@TA" and "Goods" interfaces | Dragon Social

Colourpop’s “Posts”, “@TA” and “Goods” interfaces

 

 

American cosmetics brand #Colourpop officially launched on RED shop last year, soon it became one of the hottest cosmetic brands with over 105.8k  followers.

 

 

On the brand account interface, you can see “Posts”, where businesses can create their own articles, such as information about new product launches, promotions and deals, or testimonials to engage with fans.

 

 

For the”@TA” section, the platform gathers all user-generated articles mentioning the brand on one page. It is noteworthy that brands can customize their “@TA” page by choosing which posts they would like to show in this section. (we recommend you choosing popular posts written by KOLs!)

 

 

For “Goods”, it lists all the products sold by the brand and is directly linked to the RED shop. Users can quickly screen through, look for products they want to buy, and pay directly simply by clicking the shopping cart button.

 

 

To monitor marketing performance, brands can access the data analytics section provided by XiaoHongShu. Information such as fans’ demographic distribution, exposure rate and click through rate can be monitored.

 

 

XiaoHongShu's Data Analytics section | Dragon Social

XiaoHongShu’s Data Analytics section (accessible by PC or APP)

 

 

Lastly, XiaoHongShu organizes regular sales campaigns to boost sales on the platform. Stores and brands can sign up to participate in the events. There are several occasions for which XiaoHongShu will launch platform-wide discount activities, such as the Single’s day shopping festival (11 Nov, Double 11) and XiaoHongShu Anniversary (6 June).

 

 

For example, On June 6, 2017, the 66th anniversary of the founding of the PRC, over 100 million products were sold on the platform in just two hours, skyrocketing its ranking on the Apple App store to number one in the shopping category.

 

 

Colourpop announced its sales campaign in a post | Dragon Social

Colourpop announced its sales campaign in a post

 

 

2) Cooperate with XiaoHongShu KOLs

 

 

XiaoHongShu launched its official influencer marketing platform in Jan 2019, which connects brands, brand partners and third-party content partner organizations. It now offers around 6,000 influencers covering fields including beauty, travel and fashion to brands and marketing agencies.

 

 

XiaoHongShu's newly launched influencer platform | Dragon Social

XiaoHongShu’s newly launched influencer platform

 

 

To join and use the platform, brands must first verify their official brand account. Qualified influencers should have more than 1,000 followers with a certain number of average post views, they are able to set a price for every commercial post. (from 1,000 RMB to more than 100,000 RMB per post depending on the KOL’s popularity)

 

 

To ensure money paid is worth the price, influencers can be disqualified once they are found to have too many fake fans, likes, or failed campaigns. While publishing a post, the influencer must tag the brand’s account so that brand partners can check its performance data for marketing analysis.

 

 

The influencer tagged her brand partner in the post | Dragon Social

The influencer tagged her brand partner in the post

 

 

3) Traditional display advertisements

 

 

Along with the influencer marketing platform, XiaoHongShu also introduced its official advertising packages for brands who are in favour of traditional marketing. There are two types of paid advertisements – ads that pop-up upon app-opening or ads integrated within the explore page feed, both of which can help to increase exposure and click through.

 

 

Lancôme's pop up advertisement on XiaoHongShu

Lancôme’s pop up advertisement on XiaoHongShu

 

 

Laneige's advertisement integrated within the explore page feed | Dragon Social

Laneige’s advertisement integrated within the explore page feed [Source:  Miro Li]

 

Once clicked, users are directed to a dedicated promotion page or a specific post. The advertisement is very useful for a new product launch or promotional activities.

 

 

Users would be directed to a dedicated promotion page | Dragon Social

Users would be directed to a dedicated promotion page [Source: XiaoHongShu]

 

 

4) Set up a tailor-made Topic page or Trending search

 

 

Brands can try to raise people’s attention on a specific topic by setting up a “Hot Topic Page” or “Trending Search” (hot topic). For example, International Women’s Day is heavily celebrated in China. It’s received the name  “ShenJie(女神节)” (Goddess Festival in English) and encourages girls to go shopping to reward themselves!

 

 

Jeep's topic page and promotional campaign during International Women's Day | Dragon Social

Jeep’s event page and promotional campaign during International Women’s Day

 

 

This year, Jeep launched a promotional campaign on XiaoHongShu utilizing the “Hot Topic” function. It invited the app’s users to follow Jeep’s account, then share a post about themselves with the tag  “#Be Your Own Queen”, 10 participants would be chosen and Jeep would pay for all the goods in their shopping cart.

 

 

The activity was a great success with more than 6000 posts featuring this being shared. The “Be Your Own Queen” event page became very hot on XiaoHongShu, which greatly boosted Jeep’s brand awareness.

 

 

Businesses can also consider buying a flame topic, which directs users to a dedicated topic page:

 

 

Users would be directed to a dedicated page which shows posts about the topic | Dragon Social

Users would be directed to a dedicated page which shows posts about the topic

 

 

5) Customized Sticker Packs

 

 

Brands can design customized stickers about a specific topic. For example, if you are launching a new foundation on XiaohongShu, you can design cute stickers with the product and words like “24-hour”, “Matte” and “Long-lasting”. Users can use your stickers whenever they are composing a post or writing comments. This is a creative way to gain customers’ attention and build positive connections.

 

 

Shiseido's customized sticker on XiaoHongShu | Dragon Social

Shiseido’s customized sticker

 

 

Summary: New opportunities ahead

 

 

XiaoHongShu is a fast-growing online marketplace in China. Different from Taobao and Tmall, its content-driven model attracts consumers who value quality and authenticity, which provides great opportunities for high-quality brands.

 

 

XiaoHongShu X Idol Producer | Dragon Social

XiaoHongShu X Idol Producer

 

 

With increasing popularity in Asia, XiaoHongShu has tried to further expand its business these years. In 2018, it launched its first offline concept store “REDHome” in Shanghai. The business also tried invested in television advertising by sponsoring popular reality shows “Idol Producer” and “Create 101”.

 

 

With the launch of the new marketing platform in 2019, we can foresee a lot of changes and opportunities around XiaoHongShu in the coming years. If you’re interested in getting started with XiaoHongShu and are looking for some help, shoot us an email and we’d be happy to discuss with you! We have reviewed the top 5 China Ecommerce Trends here if you want to check those out too!

 

 

Dragon Social is a China Digital Marketing Agency dedicated to providing expert solutions to businesses around the world! Our team of professionals will take a deep dive into your business and determine the optimal channels and strategies for promoting your business in China, so be sure to Contact us for a free consultation!

 

 

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Vanessa Wan

A girl from Hong Kong specializing in marketing and studying at HKUST. She loves yoga, drama and literature. Currently working with Dragon Social's content marketing team.

3 Comments
  • Albert van Lith
    Reply
    Posted at 8:13 pm, March 25, 2019

    Hello Vanessa,

    Please inform me what is meant by the “Certificate of incorporation” (under Company Qualification) ? My Business Registration is Belgian.

    Do I need to register at the Chinese authorities before I can apply to start cooperation with XiaoHongShu ?

    Thank you and best regards,

    Albert van Lith
    Antwerp / Belgium

    • Tony DeGennaro
      Tony DeGennaro
      Reply
      Posted at 3:11 pm, April 1, 2019

      Some countries have a certificate of incorporation (like us in HK), however if you don’t have it you should still be fine. You shouldn’t need to register with the Chinese authorities. I would submit the application with what you have currently and wait for their feedback before making any big decisions!

  • Zarah
    Reply
    Posted at 3:40 am, March 30, 2019

    Very interesting !

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