With Taobao recently integrating XiaoHongShu content into its shops, XiaoHongShu will certainly have a number of important moves and continue to disrupt the ecommerce industry in 2019. This year alone has been very eventful for the platform especially with the recent integration with popular ecommerce platform Taobao. So far, Taobao and Tmall have included some XiaoHongShu customer opinions in the comment section. XiaoHongShu could be vital to bringing high-quality content to Taobao (especially related to higher value product) as Taobao is currently flooded with fake reviews. Thus importing XiaoHongShu’s genuine KOL opinions, reviews and content could help add more credibility and authenticity. Additionally, sellers will have no control over which product reviews will be shown on their online store, as Taobao’s recommendation algorithms will do the job.
After Alibaba invested in XHS, everyone is wondering what resources XHS will need from Taobao. It turns out Taobao made the first move.
However, since both tech titans Tencent and Alibaba have invested in XiaoHongShu, many are wondering which direction the platform will take. For now, this integration signals a few things:
Taobao needs more user-generated and genuine content from XHS
Although Taobao has been trying to push original content through Weitao and changing some of its features and comment format, consumers are still hesitant about the realness of the reviews thus causing Taobao to choose integrating with XiaoHongShu instead. XiaoHongShu has created a strong community which focuses on users’ original content and authentic reviews. This integration will therefore not only create a greater value for consumers, it will also cause a change within Taobao, shifting it from a pure ecommerce platform to a more content-driven platform.
As of now, there are only 40 brands (including Shiseido and Guerlain) that have been selected to be a part of the first round of testing. These 40 participating brands are mostly beauty and cosmetics brands and only selected articles display integrated XiaoHongShu comments. However, we can expect more brands to incorporate this feature on Taobao as the evolving trend of user-generated content in e-commerce is pushing popular e-commerce platforms to implement a more creative approach.
How can brands use this combination – of content and ecommerce – to their advantage?
Brands who do not want to open shops on XiaoHongShu can simply utilize it as a marketing channel. It is currently very hard to drive traffic from XiaoHongShu to other ecommerce platforms but with this integration there is a direct connection to Tmall. Users stay in the Taobao app even if they click into the XiaoHongShu content, making it easier for brands to measure campaign performance and track the conversion rate.
As the fine line between content and ecommerce is increasingly becoming blurred we forecast that content will play an even more important in the ecommerce industry in the years to come. Brands should get prepared on using XiaoHongShu to raise brand awareness as it is a very powerful tool for word of mouth marketing. Moreover, brands that use KOLs in their marketing campaigns should keep in mind that what they post should stay in line with the brand’s values while being as authentic as possible, causing consumers to grasp a better understanding of a certain product and how to incorporate it in their everyday life.
How will this affect XHS?
The uniqueness about XiaoHongShu is it's a social ecommerce platform, integrating ecommerce elements into a social platform. But with this recent integration we have to wonder what will happen to its ecommerce side? Let's wait and see.