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May 18, 2020 10:48 pm · China Economic

Fang Zhai from Xiaohongshu: Insisting on providing online life

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May 11, 2020 09:40 am · ocn.com

Xiaohongshu broke into the car live track

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Apr 24, 2020 12:00 am · beijing business taday

The live broadcast of Xiaohongshu has been officially launched 

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Apr 23, 2020 04:50 pm · tech.163

Xiaohongshu: Pushing 10 billion PV flow support plan

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Apr 21, 2020 02:53 pm · news.cn

Users can book the homestay directly in Xiaohongshu

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Apr 21, 2020 01:27 am · money.163.com

Xiaohongshu does not notify members of automatic deductions

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Sep 11, 2019 02:22 pm ·

Perfect Diary Tracks China's Color Cosmetics Surge with A New Round of Financing

The recent two decades have seen rapid growth in China’s beauty industry. Color cosmetics is one of the leading sectors underpinning the country's increasing spending on personal image. According to 36 Kr, Perfect Diary, one of the hottest emerging stars in color cosmetics, has completed a new round of fundraising with a valuation of over USD 1 billion. Hillhouse Capital Group led in the investment, followed by Sequoia Capital and Chinese Culture Group. Founded in 2017, Perfect Diary is an e-commerce-based cosmetic brand. The company is committed to exploring the trends in international cosmetics and the frontiers of fashion to provide easy-to-use cosmetics products for young Asian women. The founding members are all post-80s and post-90s with an international background and global mindset. Being confident about China’s beauty industry, Perfect Diary aims to create an iconic sense of ‘Chinese Beauty’ with international influences. In order to achieve the same quality with international brands, it chooses the best makeup OEMs in the world, which also cooperate with Dior, YSL, etc. Having a full product category, its strategy is to launches one or two phenomenal products at a time to build brand awareness among consumers. Perfect Diary is professional in branding and online traffic management. By launching co-branded cosmetic products with KOLs, idols and even some famous organizations like the British Museum, the brand rapidly bulked up in brand awareness and sales, expecting to surpass CNY 3 billion (USD 429 million) in revenue on Alibaba’s e-commerce platform. This strong uptrend in color makeup is supported not only by an upturn in living standards spurred by the ongoing consumption upgrade and the rising awareness of personal grooming amongst Chinese consumers, but also the expanding user base among millennials and Gen Z. Moreover, men in China are more confident and willing to purchase and use beauty products, including both skincare and cosmetic. The main consumer force of the men’s beauty market is the younger generation, who are more open; traditional opinion is being updated and some traditional consumption boundaries are gradually disappearing. The sales of men’s skincare products surged 82% above the previous year. Color cosmetics for men posted a 122% high in increase amounts. We should no longer deem beauty an exclusively female domain. Another indispensable factor in boosting color cosmetics is the application of live broadcasting and social media. Internet celebrities and influencers on social network platforms RED, Douyin (Chinese Tik-Tok) and the likes livestream reviews of countless cosmetic products and give beauty advice to the audience. Chinese male beauty blogger Li Jiaqi, who can live stream testing as many as 380 lipsticks a day, is also a strong promoter of Perfect Diary. He earned more than CNY 10 million (USD 1.53 million) over the past year – a successful case of leveraging new media channels and the trend for color cosmetics.

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Aug 1, 2019 09:09 am ·

Is RED Driving A New Maserati Down A Dead End Street?

On August 1, in response to the recent drop of APP in major application markets, RED (小红书), the lifestyle-sharing platform issued a statement at 3:43 a.m. this morning saying that the company has launched a comprehensive investigation and rectification of its content, conducted self-examination and self-correction, and actively cooperated with regulation departments to promote a better Internet environment. Market observers thought the ban is related to the misleading medical aesthetic notes on RED platform. One day before the drop, Nanfang Metropolis Daily published a piece of news on the unregulated medical aesthetic industry chain ran on RED to serve the micro-plastic surgery. It reported a large number of drugs banned by the state but publicly sold via the notes on the platform. Some other observers who claim to be informed said RED was spreading pornography and conduct sex trade in shared notes that related to hotels. However, the chaos is originated from a good intention of sharing good lifestyles. In 2013, the Shanghai-based company started its business from a shopping strategy brochure that provided shopping guidance to tourists who travel abroad. Precisely grabbing the opportunity of outbound travelers' substantial increase, the brochure with informative content got so popular that was downloaded 500,000 times in one month. Later in 2013, RED launched its APP and gathered not only common users but stars and KOL sharing goods, travel notes and lifestyle on its platform. Now RED'S users reached 250 million, the MAU bounced around 90 million, and the user-generated notes are exposed 3 billion times per day. The bulked-up DAU, MAU of RED attracted giant investors like Tencent and Alibaba and boost its valuation to USD 3 billion, however, RED is still in its conundrum of commercialization and regulation. (See financing news of RED) With a great proportion of users transformed into buyers, the sharing platform naturally extended the business to cross-border e-commerce. Nonetheless, the business didn't last long due to fierce competition and policy. A new regulation abbreviated 408-file that jointly released by Chinese authorities, including the Ministry of Finance (MOF), has brought vital damage to cross-border e-commerce platforms, RED included. After 2017, RED made up its mind and claimed to be a social and lifestyle-sharing platform. The company keeps weakening its “e-commerce” label since highly saturated online shopping platform is no longer fancy in China. The strategy workes as RED‘s business model has returned from commodity sales to generating online traffic. Retreated from the cross-border e-commerce competition, RED now functions partly as the promotion channel for those players desperate for traffic and is the best among other sharing platforms such as Kuaishou and Douyin. Behind the traffic selling business, there're still more to concern for both RED and regulators. April 16, 2019, Beijing Center for Diseases Prevention and Control (北京市疾病预防控制中心) released the monitoring results on tobacco’s online marketing data. On RED alone, there are more than 95,000 marketing posts related to "smoke".  One note titled "refuse to smoke and keep healthy" was actually a sneaky advertisement selling e-cigarette to youth. How to achieve credibility with more than 70% content generated by users while some "users"  were spreading misleading content or selling unregulated products? The revenue of RED is mainly from advertisement when opening the APP, distributing notes based on information stream and commission from cooperation with stars and brands. Therefore, the credibility of shared-notes is crucial to its commercialization. In return, commercialization should feature authenticity to be consistent with other notes. It's a dilemma.

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Jun 29, 2019 01:00 pm ·

Xiaohongshu Seeks USD 500 M Financing, Striving for Independence from Alibaba?

Xiaohongshu (小红书), also known as RED, is a social media and e-commerce platform in China. After raised USD 300 million in its Series D fundraising on May 2018, it is seeking another round of funding with USD 500 million, possible investors are Vision Fund under Soft Bank, Sequoia Captial and Hillhouse Capital, citing people with knowledge of this matter. Founded in 2013, Xiaohongshu is one of the fastest growing platforms in China. It reached over 200 million registered users at the beginning of this year, with the post 90s generation being the most active group. Users share short videos and photos about fashion, beauty, food, travel, and much more on this lifestyle sharing platform, as Xiaohongshu called itself. Since lots of its users generate shopping-related information, Xiaohongshu inevitably becomes a hybrid of social media and e-commerce. Although the company describes itself as a content-oriented social platform, the commerce side flows seamlessly from the social side.  8% of Xiaohongshu users would make an order on the app after reading the sharing notes, compared with 2.6% who do the same on Tmall, China’s largest marketplace for brand goods, owned by e-commerce giant Alibaba.  When the company held a shopping festival for its 4thanniversary in 2017, Xiaohongshu exceeded CNY 100 million in sales revenue within two hours. At the same time, other e-commerce platforms with a social gene have emerged with eye-catching performances: Pinduoduo (拼多多), the social e-commerce leading brand, listed on NASDAQ within 3 years of inception. Yunji (云集), another social e-commerce brand followed to listed on NASDAQ in its fourth year of establishment. On the other hand, the traditional e-commerce giants like Tmall, Taobao and JD.com have experienced the slowdown of the increase rate of its users, the cost of acquiring customers keeps increasing while the traffic bonus from first and second-tier cities are going down as well. Under these circumstances, Alibaba Group, the parent company of Tmall and Taobao, would never wait for opportunities. It took the lead in Xiaohongshu's last round of funding, obviously not only interested in the return of its investment.   Famous for its strong and controllable investment logic, Alibaba clearly stated that it will not invest or acquire for purely financial reasons, but will focus on strengthening Alibaba's ecosystem, creating strategic synergies and improving the company's overall value. Most of the projects acquired by Alibaba experienced the first few equity investments in the early days and then the fate of the overall merger.  Xiaohongshu, after invested by Alibaba, was also suspected of being controlled by the powerful investor. On February this year, the company had adjusted its third-party e-commerce department, which used to be an independent one, to its social brand department. Rumors said the changes, maybe unwillingly, were to transfer Xiaohgonshu to a traffic generator for Alibaba's own e-commerce platforms. The new round of funding, with an expected valuation of USD 6 billion, would somehow free company to some extent from Alibaba's control. An insider who prefers to stay anonymous said that the Xiaohgonshu signed a quite clear contract (a contract without too many additional terms or obligations) during the last round investment, striving to be independent, not an affiliate of Ali's ecosystem. By emphasizing its social and sharing trait of the platform, the company keeps weakening its “e-commerce” label. The highly saturated online shopping platform is no longer fancy in China, Xiaohongshu, in its trying to find a balance between content sharing and e-commerce.  With 70% of its users born after 1995, the representative of Generation Z and future purchasing power, Xiaohongshu would be the company that best knows the next generation of consumer trends and it wants to tell the public and capital about a story with bigger imagination.

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