Behind a series of adjustments is Xiaohongshu’s re-examination of its own positioning and growth logic in the context of the peak of traffic dividends and the weakening of the grass planting effect. This article will explore how the rise of instant retail has impacted the traditional grass planting model, analyze the changes in Xiaohongshu’s attractiveness to brand merchants, and its swing and choice between e-commerce business and community attributes.
As a “minority” male user on the Xiaohongshu platform, after a few months of use, I still decided to uninstall Xiaohongshu.
For no other reason, I am a little tired of the recommended content under the algorithm cocoon. The reason why I started playing Xiaohongshu at the beginning was because the “Chinese and American netizen reconciliation” aroused my interest. I didn’t expect it to start with interest, and finally to be interested.
Recently, I have been brushing Xiaohongshu, and I obviously feel that there are more advertisements, and all kinds of hard, broad, soft and accurate pushes, perhaps after opening up cooperation with Taobao and JD.com, the commercial atmosphere seems to be stronger than before.
I vaguely felt this:After the opening, Xiaohongshu seemed to be anxious. The flash sale war between giants has amplified Xiaohongshu’s growth anxiety. After all, the popularity of instant retail has also reduced the grass planting effect of the content community to a certain extent.
The flash sale war of red, yellow and blue shows that these daysIt is much more useful to directly subsidize users than to buy traffic, and the value of the content platform is decreasing.
As Dong Ge said: “Fight to support war”,Investing money in takeaway, JD.com’s advertising costs have also been reduced.
Flash sales are such a simple way of playing that not only affects Xiaohongshu, but also affects Douyin and Kuaishou. It’s just that the user time of Dou Kuai is longer, and the e-commerce business has matured, and the overall impact is not great. Xiaohongshu has lost the imagination of the e-commerce business, and the difficulty of commercialization may have increased.
So the question is, flash sales are hot,How attractive is Xiaohongshu’s “grass planting” model to merchants?
Flash sale war, bitter grass planting mode?
Today’s e-commerce giants are all going in the direction of super APP, JD.com does short dramas, Meituan also does, plus live broadcasts and short videos, today’s e-commerce platforms are all content + community + local life giant physique.
The next step is to plant grass as well.
During this year’s 618 period, various platforms are strengthening their ability to cultivate new brands, and JD.com, Taotian, and Pinduoduo have all invested more resources to help new brands start their volume.
For Xiaohongshu, since it can’t be beaten, it is better to join early, and the stop loss of the e-commerce business to embrace the big platform is a strategic choice after judging the situation.
What does a product manager need to do?
In the process of a product from scratch, it is not easy to do a good job in the role of product manager, in addition to the well-known writing requirements, writing requirements, writing requirements, there are many things to do. The product manager is not what you think, but will only ask you for trouble, make a request:
View details >
It’s not that Xiaohongshu is not attractive to merchants, but the underlying logic of growth has changed.
The instant retail war proves one thing:The platform of traffic distribution cannot beat the demand distribution platform.
Truly efficient conversion is not to plant grass, but to penetrate the brand mind at the beginning, shorten the link and directly leverage high conversion.
Luckin was like this back then, 9.9 cups of raw coconut latte did not need to plant grass at all, with just needed, low gross profit explosive models to pry the mind, and then do the transformation at the sales terminal.
This is also the core logic of flash sales.
The logic of traditional e-commerce is to first reach and then have a brand mentality, and then rely on various promotional activities to promote conversion. So “planting grass” is the first step.
But “planting grass” also has a cost, content bloggers and platforms are essentially “traffic middlemen”, and the “intermediate cost” of producing content will eventually have to be paid by users who are “planted with grass”.
Distribution with traffic is actually not in line with the principle of maximizing the efficiency of commodity distribution.
In recent years, the incremental areas in the consumer industry have been “distributed with demand”.
For example, in the snack industry, Zhao Yiming and snacks are very busy, why they can rise rapidly, in fact, they rely on 2 yuan of cola and 1 yuan of mineral water, which is just needed to drive traffic.
In the supermarket industry, why Yonghui can become popular, not only because he learned the business philosophy of Fat Donglai, but also because he used Fat Donglai’s self-operated products to leverage traffic.
This is the same as the growth logic of JD.com, Taobao, and Meituan’s flash sale business:“High frequency band low frequency, just need to bring non-rigid demand”.
On the contrary, on the content platform side, when there are more and more software and broadcasting, users are gradually desensitized, and the cost performance of content planting and grass conversion is not as high as before.
At this time, the increment shown by instant retail is actually more attractive to brand merchants.
Will brand merchants focus more on instant retail platforms in the future? I think it’s a very interesting point to observe.
In fact, flash sales change users’ buying behavior and habits.The e-commerce value of content platform traffic may be further weakened.
For example, recently, friends have stopped searching online to buy things, but opened flash sales and looked at them first. Having a suitable direct purchase essentially shortens the conversion link.
When the decision-making link of goods is shortened, planting grass is meaningless. This is why it is becoming more and more difficult for certain categories with rigid attributes to grow on content platforms.
The core of Xiaohongshu’s attraction to brands and merchants lies in two points:
1) Purchasing power of the crowd.
Xiaohongshu’s user base is the most purchasing group in the consumer market: young white-collar women in first, second, and third-tier cities. This group emphasizes the sophistication of consumption, but is also careful while pursuing quality.
In addition to Xiaohongshu, this part of the purchasing power is also distributed in JD.com, Taotian, and in the live broadcast rooms of Li Jiaqi and Dong Yuhui. In other words, to leverage the needs of this part of the population, Xiaohongshu is not the only entrance.
For some products with long decision-making cycles, the entrance is not so important, and Xiaohongshu’s advantages are still there.
2) Low-cost brand cold start.
The core value of Xiaohongshu is to cultivate new brands, and to use soft and broad content to make a cold start for new brands. However, after the cliff-like decline in Xiaohongshu’s traffic, more and more brands have found that it seems to be more difficult to do a cold start in Xiaohongshu than before.
In essence, because of the increasing number of homogeneous notes, platforms have to constantly adjust their strategies and balance the content ecology. And every adjustment, merchants have to adapt again, which will also bring corresponding costs.
Why do brands advertise, in fact, is to strengthen the mind. For brands, mind = free traffic.
To leverage the mind, it is still to look at the head e-commerce platform. During this year’s 618 period, the turnover of 453 brands on Tmall exceeded 100 million, and the growth of JD.com’s 3,000 home appliance brands doubled.
You see, the brand incubation ability of e-commerce platforms is not necessarily worse than that of content platforms. At present, mainstream e-commerce platforms are doing new brand incubation. Then the value of Xiaohongshu’s “cold start” does not seem to be so great.
The content dividend cake is not enough for the brand
Whether it is the purchasing power of the crowd or the cold start of the brand, it actually shows that the platform of Xiaohongshu has always had dividends.
For brands, dividends are cakes,It is a structural increment.
Haidilao’s service is a structural increment in the catering industry, the quality of “Black Myth Wukong” is a structural increment in the game industry, and the emotional value of Xiaomi YU7 is a structural increment in domestic new energy……
You see, most of the time, structural increments are spontaneous growth of brands, rather than dependent on some content bonus platform.
Because, in today’s surplus market, any visible traffic dividend will eventually attract a large number of brands to flock to it, and then the dividend will disappear.
There is always a “28” rule in the market, 20% of merchants are making money, and 80% of merchants are involuting. The same goes for Xiaohongshu.
Recently, Xiaohongshu has undergone an important change: announcing a brand upgrade and a changeslogan，From a life guide to a “life interest community”.
The matter of changing slogan actually reflects Xiaohongshu’s current thinking about its own situation:When grass planting becomes a kind of brand, what should Xiaohongshu do?
Obviously, whenThe growth of brand grass planting has shifted from incremental to stock era, and the cake of the platform is a bit insufficient.
Or to put it more bluntly: take pictures on Xiaohongshu and take notes, and then the era of a product selling out is over.
In the past, there were only three ways for brands to plant grass in Xiaohongshu:Experts plant grass, place information flow, search and stream.
These three methods can work, provided that Xiaohongshu can still have a healthy and real content ecology. When bloggers on the platform plant more and more content and the balance of the content ecology begins to tilt towards commercialization, it becomes more difficult for the endogenous traffic growth of the platform to grow.
The data seems to confirm this.
According to Questmobile report data, in the first ten months of 2024, Xiaohongshu’s average monthly active users were 214 million, an increase of only 11.9% from the same period in 2023. In other words, Xiaohongshu’s traffic market does not seem to be growing so fast.
From life guides to interest communities, Xiaohongshu obviously hopes to complete itDual expansion of traffic and commercialization.
From emphasizing “lifestyle e-commerce” to now emphasizing “interest community”, intuitively, the biggest change is the lack of e-commerce roles.
This is actually not difficult to understand.
On the one hand, in terms of Xiaohongshu’s volume today, it is inevitable that it will have to confront mainstream platforms in close proximity to continue to do e-commerce, and Xiaohongshu’s revenue pillar still depends on advertising.
On the other hand, with the size of Xiaohongshu, going deeper into e-commerce means going deep into the supply chain. The experience of Kuaishou and Douyin in e-commerce shows that content platforms are focusing on the light model, which requires a lot of resources and infrastructure capabilities.
Xiaohongshu’s ability still has a gap in size with Kuaishou and Douyin, so it is not wise to stumble in the direction of e-commerce.
In fact, in the past few years, the expansion of traffic and commercialization has always been the main line of Xiaohongshu. Therefore, Xiaohongshu has become more open and takes the initiative to embrace Taobao and JD.com.
For Xiaohongshu, although opening external links does not mean giving up e-commerce, it is obvious that the strategic level of e-commerce business has been lowered. The positioning of the “interest community” may also reflect the entangled side of Xiaohongshu.
The success of Douyin interest e-commerce is ahead, and the 3.5 trillion GMV volume has proved to the market that the road of “interest” is feasible. It also relies on algorithms, why can’t Douyin make Xiaohongshu?
Xiaohongshu may be more easily recognized by the market if it follows the path taken by Douyin.
From lifestyle e-commerce to interest communities, Conan’s idea may be that Xiaohongshu advertising e-commerce walks on two legs.
On the one hand, the advertising business continues to increase the monetization rate, on the other hand, it retains the fire of e-commerce, and then waits for a window period to choose the opportunity to go public, and finally give shareholders in the primary market a good return.
Adjust in XiaohongshuBefore the slogan, there was also a denied rumor: Ali was going to buy Xiaohongshu.
In fact, for Xiaohongshu,An IPO is far more cost-effective than being acquired.
A simple math shows that the news of the acquisition is a rumor.
In fact, there has been no shortage of news about Xiaohongshu’s IPO on the market. According to the financing history of the Tianyancha APP, by July 2024, Xiaohongshu has raised in Series E, with a valuation of $17 billion, and according to recent media reports, Xiaohongshu’s overall valuation has reached $26 billion.
In fact, what is more worth discussing than the rumors themselves is,Why is there a soil for such rumors to be born?
I think the mentality of the market has changed, when the content platform refocuses on traffic, the future of e-commerce business is uncertain。It is inevitable that there will be speculation from the outside:If the future listing fails to have an ideal valuation, then selling giants is also a good choice.
Whether it is selling itself or going public, the current Xiaohongshu still has value to be explored. And ten years later, will Xiaohongshu walk the road that Hupu has walked again?
It is worth pondering.
