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A new consumer brand whose online GMV exceeded 1 billion yuan, its founding team began to study Xiaohongshu.

The founder's judgment is based on the fact that the high-growth era has passed, and the growth rate of the e-commerce industry has not kept up with his expectations for brand growth. Compared with other platforms with the same user scale, Xiaohongshu's commercial value has not yet been fully released, and "the competition is relatively less fierce."

More first-line brand founders and merchants have heard the industry's clamor. Especially in 2024, the merchant group is generally shrouded in extreme price power and growth anxiety, and it is urgent to find a new battlefield in the stock.

More and more people are beginning to focus on Xiaohongshu e-commerce. Paid operation courses and paid sharing about Xiaohongshu e-commerce have begun to appear intensively in public accounts and communities. In a private board meeting, Xiaohongshu night talks have been held for several weeks in a row. The topic that people are concerned about is: How to make money on Xiaohongshu e-commerce?

Merchants who see potential are gradually migrating to Xiaohongshu to "strike gold". Data also proves this point. Gintoki, the head of Xiaohongshu's e-commerce operations, once mentioned that during the 618 period last year, the GMV of merchants doing store broadcasts alone reached 5 times that of the same period last year. Compared with July last year, the number of merchants with monthly sales of 5 million or more on Xiaohongshu's e-commerce has also increased by 3.5 times.

Until June this year, the outside world's signal to Xiaohongshu e-commerce was still buyers. But obviously, Xiaohongshu e-commerce wants to tell everyone that there are more than just buyers in the ecosystem. After a new round of research into merchants, the Xiaohongshu e-commerce team saw the real emergence of the group of managers in the ecosystem.

Gintoki told 36Kr that the managers are lifestyle product managers who understand user needs and can match the supply chain to provide better products. Most managers are immersed in the Xiaohongshu community, and some even live broadcast in front of the camera to communicate directly with users. This group of people is one of the most active roles on Xiaohongshu this year.

More e-commerce people are looking for their own "golden groove" on Xiaohongshu e-commerce, and Xiaohongshu e-commerce also wants to go further and find its own differences. On July 22, Xiaohongshu COO Conan first defined it to the public: Xiaohongshu e-commerce is a lifestyle e-commerce. The difference positioning was summarized from user feedback, "Many users said that what they bought on Xiaohongshu is not just the product itself, but a lifestyle."

For businesses, opportunities lie here.

Go and find a different new battlefield

Yinuo, the manager of the cultural and trendy toy brand "Yino Bennuo", was reluctant to do live streaming at first. Firstly, he was worried that the average order value of his products was too high and not suitable for the consumption scenario of live streaming. Secondly, he believed that the edges and corners of his personality would not be accepted by users and he worried that "I might offend many people if I go to the live streaming room."

After Xiaohongshu's e-commerce operator got to know Yinuo, he repeatedly went to the company or WeChat to find her and asked her to do a live broadcast. Yinuo recalled: "I remember rejecting her three times, and then the fourth time, I agreed to do a live broadcast, but I was very pessimistic."

This "unpromising" live broadcast had no lights and no stock. In just a few hours, it sold 170,000, so there were second and third shows, with sales of 350,000 and 430,000 respectively. Yinuo clearly remembers these three initial numbers, because they were higher and more stable afterwards. A new market was opened up in this way.

Yinuo has been working in this industry for ten years. The industry's single-digit growth rate each year makes her more eager to find a differentiated business.

Starting in 2016, she decided to polish her products, so she built her own design team and tried to seize the "aesthetic dividend". 2022 was another turning point, and she began to migrate her business to Xiaohongshu. Later, she became the host of Xiaohongshu's live broadcast, and the most direct change was that her user group expanded to a group of young female users in addition to middle-aged men.

Yinuo has an insight that cultural relics will develop in the direction of fashion. Young people no longer only have requirements on the material, or that they look good when worn on the body, but also hope that the relics carry their own lifestyle, "have culture and emotional value".

Beads have been transformed into daily accessories by Xiaohongshu users, and the acceptance rate is high, but products that meet the demand are needed. Yinuo led her team to squeeze into the Xiaohongshu e-commerce market. Yinuo said that after joining Xiaohongshu, her brand's annual sales have tripled.

Many brands entered Xiaohongshu with doubts. The home furnishing brand Zhiwu opened a store on Xiaohongshu with doubts. Home furnishing buyer "Yike KK" had not yet achieved a sales of over 100 million during the promotion period, but was looking forward to introducing more new brands and getting different products. She used only seven words to convince Zhiwu's manager, "Xiaohongshu is serious."

Like many businesses, Zhiwu's manager Nie Ping opened up sales channels with a try-it attitude. In April this year, Zhiwu and Yike KK jointly developed a four-season soft bed. In a mixed live broadcast with more than 300 links, more than 100 of the four-season soft beds were sold. Nie Ping concluded, "In fact, designer large-scale furniture cannot compete with brand names in terms of price. It looks good, but it also requires a certain aesthetic to match."

Buyers act as amplifiers in the Xiaohongshu e-commerce ecosystem, which is one of the reasons why Xiaohongshu e-commerce attracts more merchants, including managers. Store broadcasts keep more merchants here.

Before the Xiaohongshu e-commerce platform, the home furnishing brand Yizhou Zhuwuji had never done live streaming. "E-commerce platforms focus on business and transactions. For designer brands like us, there is no place to plant grass or be discovered by users for a long time." The owner Zhang Yizhou hesitated for a long time because he thought that the only way to sell goods through live streaming is to lower prices, "but this is not what our brand wants."

But looking at the price alone is not necessarily the only answer. Zhang Yizhou, who saw the potential of Xiaohongshu, decided to increase investment in Xiaohongshu e-commerce this year, establish a live broadcast department exclusively for Xiaohongshu, and set a goal of 10 times growth.

A merchant made a metaphor that sounds a bit "exaggerated". They have been making products for ten years, but the founder feels that they have reached a watershed in 2023, "from a trademark that purely sells goods to a brand, a brand that focuses on users."

Slow down and be seen

"The Cowboy with Dreams" is just as his name suggests. His profile on Xiaohongshu reads: "A 62-year-old grandfather! He has devoted his youth to cowboys all his life."

Before joining Xiaohongshu, Lao Wang had been engaged in the denim industry for more than 30 years, mainly doing OEM for brands. Being the manager of Xiaohongshu is Lao Wang's second venture. Affected by the epidemic, the number of orders for his factory decreased. With the help of his daughter, he began to follow the trend and "live broadcast to save the factory."

A fan left him a message saying: "Lao Wang, I have a thick waist and thick legs, but I want to wear shorts in summer. Can I wear this kind of pants?" After seeing this, Lao Wang decided to solve the problem of "thick waist" - by adding an elastic band on the waist.

Lao Wang calls his fans "sisters". Following the feedback from videos, notes, and live broadcasts, he continues to produce new products to address the demands of his "sisters" for jeans for different body types, such as tall, short, and pear-shaped people.

Gintoki has witnessed the changes in Xiaohongshu's e-commerce over the past two years. He mentioned that when he walked into the merchants on Xiaohongshu, he clearly felt that most of the merchants on Xiaohongshu did not regard the platform as a traffic field, nor did they do traffic business, but rather "operated business."

The obvious difference in "operation" is that from buyers to managers, they all care about user feedback and continuous connection. "They can find differentiation on Xiaohongshu, find a group of users who like them, and update products and solutions according to their needs. In this process, they can make money."

A group of merchants and buyers who are close to life and truly understand user needs have stayed.

When mature institutions, influencers, and even merchants enter the Xiaohongshu e-commerce ecosystem, they all need to make some "changes." When mature anchors from other platforms do buyer live broadcasts on Xiaohongshu, they will constantly ask if the pace is too fast; some will also say at the end of the live broadcast that Xiaohongshu's live broadcasts do not promote sales, which can help them not get too excited after the broadcast.

On Xiaohongshu, fans’ interactions are also driving changes in merchants. The ancient gold brand Jijin Jiayi was transformed from a gold foundry. Within three months of its launch on Xiaohongshu, it achieved monthly sales of over one million.

The manager Fang Zhengjun gave an example. A fan bought a cat bracelet from Ji Jin Jiayi, DIY transformed it into a ring, and shared it on Xiaohongshu. Many netizens ran to Ji Jin Jiayi's live broadcast room to "ask for the link to the cat ring", which confused the host because Ji Jin Jiayi had never produced this product.

After understanding the cause and effect, Ji Jin Jiayi quickly made adjustments to meet user needs and launched the cat ring, which also became a big hit of the brand.

Manager Fang Zhengjun told 36Kr that many young people around 30 years old with a certain level of spending power will start to consider gold consumption, but they prefer to buy gold that meets young people's aesthetic tastes, such as cat rings, rather than traditional flower, bird, fish and insect rings. Therefore, adjusting according to the voice of consumers also makes the brand closer to the target customer group.

"In lifestyle e-commerce, people are very important. Only people can display and explain different lifestyles. We also hope that more merchants representing different people's lifestyles can be seen." Gintoki repeatedly expressed to us the importance of people.

Conan also gave an example. "Wang Wei WHICH" is a fashion manager who shares outfits for slightly plump and pear-shaped girls. She has 20 years of experience in the clothing supply chain. Although Xiaohongshu has only more than 10,000 fans, Wang Wei has sold nearly 3 million in a month in half a year. She said: "When I reveal my belly, there is stickiness and traffic, because they feel it is very real. I am a pure amateur who can touch the hearts of ordinary people."

The biggest commonality among Lao Wang, Fang Zhengjun and Wang Wei is the emphasis on the presence of "people". Because of real people and sincere sharing, even if they do not have a huge number of fans, they can accurately find people who like them on Xiaohongshu and achieve resonance.

More importantly, they all meet some of the demands that are considered personalized and niche in the traditional e-commerce world - "jeans suitable for people with thick waists and legs", "gold suitable for young people in their early 30s", and "outfits suitable for slightly plump and pear-shaped figures".

Finding target users and selling to the right people is the survival rule for a group of merchants today. When basic consumer needs have long been met, a new group of merchants have found a new fulcrum in Xiaohongshu e-commerce - personalization brought by people.

Picking low-hanging fruit and building a new consensus

36Kr learned that in the survey in June 2023, the Xiaohongshu e-commerce team saw the budding of the group of managers in the Xiaohongshu e-commerce ecosystem. But this year, the group of managers emerged intensively.

According to Xiaohongshu's definition, the managers almost all have many years of relevant industry experience and understand users, supply chains, and every aspect of operations. They have seen brand competition and industry differentiation, but they always have to find a place to run their business healthily.

So, they moved to Xiaohongshu, and a group of merchants reaped the benefits from it.

In 2023, Xiaohongshu integrated its e-commerce business and live streaming business into a new first-level department, the Trading Department, which is parallel to the Community Department and the Business Department. After the adjustment, live streaming was placed in a more important position. Subsequently, Xiaohongshu e-commerce proposed that "the buyer era has arrived."

At that time, the Xiaohongshu e-commerce team realized that Xiaohongshu needed to be different from others in e-commerce, and it could be different. The "people" in Xiaohongshu's e-commerce ecosystem are the core of differentiation.

After the emergence of the buyer group, many people use "buyer e-commerce" to define Xiaohongshu e-commerce. However, Xiaohongshu is very clear that buyers are not the whole of Xiaohongshu's e-commerce ecosystem.

Gintoki recalled the process. Initially, Xiaohongshu selected a group of bloggers who understood lifestyles to recommend good products. Users recognized their lifestyles and the products they selected for their lifestyles, and these people became buyers. Users developed trust, attention, and connections with more three-dimensional people. This also inspired more merchants, especially those who originally made lifestyle or personalized demand products. They entered Xiaohongshu as managers and began to manage accounts and pallets.

This is partly the result of the spontaneous evolution of the ecosystem, and also partly the choice of the platform. Yinshi said that in the past year, he has seen various types of merchants, including experienced merchants, but most of those who have stayed and run well can interpret different lifestyles and product combinations under different lifestyles in the live broadcast room. Yinshi gave an adjective called "treasure".

Gintoki told 36Kr that for lifestyle e-commerce merchants, no matter how big or small they are, they care about getting accurate users, selling products that users like, and being continuously recommended. Allowing users to not only buy your products but also say hello to you has become a necessary condition for defining a "brand" in the minds of users.

In the Internet world, concepts represent the platform's recognition of its own identity. For example, creators are defined as bloggers, UP hosts, and experts. E-commerce models are defined as trust e-commerce and interest e-commerce. Each concept allows people to immediately connect to the platform behind it and its own differentiation.

In 2024, Xiaohongshu e-commerce clearly defines itself as a "lifestyle e-commerce". On the one hand, it releases the differentiation of its e-commerce model to the outside world, and on the other hand, it provides a guide for future operations to more merchants and buyers.

Recently, more than one platform has begun to weaken its price power strategy. In the vortex of competition, a new consensus is forming: merchants need a good living environment, and platforms need a healthy growth space.

For Xiaohongshu, e-commerce is a systematic project. As a new player in e-commerce, Xiaohongshu is first and foremost a content community. Although the progress of e-commerce has been accelerated in the past year, and various gold diggers have also poured into the ecosystem, it still takes some time to further open up the e-commerce links in the Xiaohongshu community.

But countless gold diggers who are brave enough to try have proved that accurately identifying users and matching good products with real needs is enough to do a good business.