Unicorn Xiaohongshu refines social commerce model after stumble, as bigger players jostle in

Once the epitome of China’s O2O social commerce success, Xiaohongshu (RED) tries to reinvent itself amid challenges from internet giants, influencers and short videos

When Xiaohongshu ("Little Red Book") was launched in 2013, many Chinese who wanted to buy fancy foreign goods did not know what to buy or where to go. They turned to friends or family living or traveling abroad or professional buyers outside China, who made a living by purchasing popular products for customers in China.

To cater to their needs, Xiaohongshu, which later rebranded itself as RED outside of China, built a modest social media platform on which any registered user could post product reviews, shopping and travel trips. It was so popular that within a year, it amassed over 220m registered users, including local celebrities. 

Users trusted what their peers or influencers recommended on the platform. “Xiaoshuhong is so real, so are those videos and product reviews. Its users are trustworthy,” said one user. For another user,  Xiaohongshu was her first port of call when she wanted to buy washing powder. “I knew it would give me what

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