Sageus Collective

The Instagram of China — here’s why brands should be on Little Red Book (Xiaohongshu)

Instagram has been a critical platform for branding and marketing on a global scale, but did you know there’s a similar social media app for Chinese users? Little Red Book — or “Xiaohongshu” — is not just a typical photo and video sharing app, however.

According to TechNode, Little Red Book, or RED for short, is a mix of Instagram and Pinterest sprinkled with a dose of Taobao (which is similar to Amazon). Already, that should get marketing professionals, brand managers, and business owners excited!

Before we look at why marketing on Little Red Book is important for brands to reach a significant cultural audience, here’s a breakdown of what it is.

What is Little Red Book? 

Xiaohongshu is a content sharing and e-commerce site, particularly known for its skincare, cosmetics, and fashion-related content. As of 2020, there are more than 100 million monthly active users — 90% of whom are females. It is also worth noting that 75% of users are based in Tier 1 and 2 cities such as Beijing, Shanghai, and Xiamen, with many having higher purchasing power.

How does RED work?

Little Red Book has two main sections: the user community and the e-commerce platform. Users can engage with content by ‘liking’, ‘collecting’, and ‘commenting’. In 2021, the platform generated 8 billion impressions each day on their posts, as it is heavily focused on user-generated content, such as product recommendations, reviews, and tips.

The Instagram of China—here’s why brands should be on Little Red Book (Xiaohongshu)
Little Red Book Homepage; Image via Dataismo blog

Like Instagram, there is an Explore section which recommends content from accounts that users are not following already, based on what they like.

There is also a Nearby section that gives recommendations based on users’ location. This is particularly effective when travelling overseas as users can easily get recommendations for restaurants or places to visit.

So what makes Little Red Book an effective marketing channel for brands? 

Why brands should be marketing on Little Red Book

1. Higher conversion rates than other e-commerce platforms

About 8% of Little Red Book users make an order on the app after reading reviews, compared with 2.6% who do the same on Tmall (Alibaba’s e-commerce giant). Users can read reviews and make their purchases all within the app, the shopping experience is extremely convenient.

Unlike other e-commerce platforms, Little Red Book does not allow anonymous reviews or one-click ratings. It focuses on building trust and credibility, rather than simply driving sales.

According to Analysys, Xiaohongshu users spent 40 minutes per day on the platform and opened the app more than four times each day, on average. The algorithm predicts trends through this data and determines what people might be interested in buying, instead of pushing ads based on searches or purchases on other sites.

The Instagram of China—here’s why brands should be on Little Red Book (Xiaohongshu)
Image via Lengow blog

2. The community is built on trust and authenticity

Little Red Book reports that 69% of users rate the content as authentic, and 64% rate the recommendations as accurate. The platform functions as a product search engine, with many Chinese consumers in the beauty and fashion community looking for reviews and recommendations before deciding to purchase.

Users also go on the app to discover new products and find out the latest trends. This is why long product reviews, known as Notes, are common and perform better on the platform. 

Chinese consumers also tend to refer to word-of-mouth recommendations which makes user-generated content so successful. Little Red Book has even taken measures to ensure the community remains reliable by banning official brand accounts suspected of false marketing.

3. Helps international brands establish brand awareness

Multiple brands have found that Little Red Book is a strong platform to gauge consumer interest before officially entering the Chinese market.

For example, Bulgarian novelty luxury brand By Far’s products were not available in China, but their shoulder bags became popular among Chinese consumers through word-of-mouth recommendations. There are currently more than 10,000 organic posts mentioning By Far, which has helped them establish brand awareness and recognition. 

Brands can also utilize the platform’s authentic user reviews to better understand Chinese consumer preferences and shopping habits. So how can brands get started on Little Red Book? First, create an official account and open a cross-border e-commerce store to sell products directly on the app. Note that there are various fees required for this account. 

Brands can also choose to create a regular account, if the goal is more to gain brand visibility — which is the route that Sageus Collective took in setting up our RED page. Make sure to optimize posts with relevant graphics, hashtags and quality captions.

Sageus Collective’s RED page

4. Influencers on Little Red Book bring higher engagement

Working with influencers on Little Red Book is essential for brands to gain traction on the platform.

Little Red Book’s “Brand Partner” platform connects brands and agencies with influencers or key opinion leaders (KOLs) based on their niche and budget. Due to the tight-knit community and strict rules on the platform, influencers on Xiaohongshu tend to receive high engagement as reviews are seen to be more authentic. However, working with influencers on Xiaohongshu can be costly compared to traditional e-commerce platforms. This is an added risk for international brands to consider before stepping into the Chinese market.

Here’s the average costs of working with influencers on Little Red Book:

  • Top-tier KOLs: RMB¥50,000 to ¥100,000  ($7,300 to $15,000 USD). 
  • Mid-tier KOLs: RMB¥10,000 ($1,400 USD)
  • Micro KOLs: RMB¥3,000 to ¥5,000 ($440 to $730 USD)

Rather, working with key opinion consumers (KOC) can be more effective on a platform like Xiaohongshu. 

KOCs are everyday consumers who use products and create content. As they often have a smaller following, there is less incentive for them to create content solely for an advertising fee. This builds a personable, friend-like appeal which makes them more reliable and trustworthy. 

Brands can work with KOCs to:

  • Generate discussion around their product
  • Increase brand awareness
  • Interact with potential customers 

KOCs played a huge role in Perfect Diary’s early marketing strategy, allowing them to become one of the top cosmetic brands in China in less than three years.

The company worked with KOCs on a mass scale and made the brand appear more popular than it was because everyone was talking about it. Xiaohongshu’s algorithm also worked in their favour as the platform pushed smaller accounts on the main feed more often. 

The Instagram of China—here’s why brands should be on Little Red Book (Xiaohongshu)
Image via AdChina

Among all the Chinese social media platforms, Little Red Book’s low barrier to entry makes it the best place for brands to build their online presence in the Chinese market. 

As an emerging leader in Chinese marketing, Sageus Strategy + Digital can help brands in North America tap into the Chinese market and utilize Little Red Book’s potential.

With more than two decades of combined experiences working alongside global brands and organizations, Sageus Strategy + Digital focuses on getting to know your business, and help you connect with your audience.

Headquartered in Canada, and committed to making a global, cross-cultural, sustainable impact — we’re your one-stop firm for cultivation and growth, in all areas of branding and marketing. 

Connect with us at sageuscollective.com/connect and learn more about what we do! Stay tuned for our next blog post, and follow us on Instagram, LinkedIn, or Facebook — so you won’t miss out on any updates from our Sageus Strategy + Digital Team.

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Sageus Collective is a cultural leader in building digital platforms for creativity, growth, and connections. As one of its divisions, Sageus Strategy + Digital is a brand strategy and marketing agency connecting North American and Asian communities.

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