Exhibitors of Suzhou Innovation Fair live broadcast their cultural and creative products through Xiaohongshu and TikTok platforms. Suzhou City, Jiangsu Province, China, August 1, 2020.
Xiaohongshu has finessed its approach to influencer marketing and ecommerce, experts say. In this photo, exhibitors of Suzhou Innovation Fair livestream their products through Xiaohongshu and TikTok in Suzhou, Jiangsu Province, China, on August 1, 2020.Costfoto/Future Publishing via Getty Images

Every month, an estimated 200 million users, mostly Gen Z women, open "the little red book" app seeking beauty tips, travel recommendations, or advice on what to have for dinner.

As they browse posts, they can buy featured items through WeChat Pay or Alipay.

The app — called Xiaohongshu in Chinese — is rewriting the rules of shopping in China.

Xiaohongshu's primarily young, affluent users have spent $23 million through the app to date, according to Sensor Tower data shared with Insider. As of end February, some $1.1 million was spent in the app, a 44% increase from a year ago. Sensor Tower pegged Xiaohongshu's global downloads at 167 million, though that doesn't include Android downloads in China.

It's "kind of like Instagram, Etsy, and Amazon all in one," Sarah Yam, co-founder of Red Digital China, a digital marketing agency, told Insider.

Like TikTok, the app now wants to reach an international audience for the first time. Insider reported that the company has hired its first staffers to oversee an international launch for the app, starting with Southeast Asian markets. You can read our scoop here.

Some features of the app will feel familiar to anyone who's used Instagram, TikTok, or Pinterest.

The app's landing page is a grid of videos and images tailored to your interests.

Comparing the Xiaohongshu interface (left) with Pinterest's (right).
Comparing the Xiaohongshu interface (left) with Pinterest's (right).Weilun Soon from Xiaohongshu and Pinterest

But everything is geared to push you to buy stuff. From livestreaming to image galleries and videos, influencers, independent labels or everyday bloggers use Xiaohongshu recommend products, services, or experiences. 

How the app works

Opening the app shows three main ways to discover new content.

There's "Follow", which brings you a feed of the latest posts from accounts you follow; "Explore", which shows curated posts based on what you've browsed; and "Nearby", which features posts from creators geographically near you.

Browsing the feed of freestyle skier Eileen Gu — who's fairly new to Xiaohongshu — mostly shows clips of her in action. Somewhere in the feed is a video of Gu facing the camera, addressing the viewers in front of a vanity cabinet.

Clicking into the post, Gu starts speaking in Mandarin. A caption appears at the bottom of the post, seemingly authored by Gu, saying that she's found the "perfect tool" to arrange her makeup. Some text pops up with the post with the name of a brand, Kohler. The post is an ad for the vanity cabinet it turns out — though apart from Gu tagging Kohler's brand in the comments, there is nothing to actually indicate this is a paid placement.

One user comments: "Your looks are what all of China aspires to have."

Clicking onto the post takes you to Kohler's official Xiaohongshu store page.

Elsewhere, you might click the "Explore" tab to show brands livestreaming their goods.

One post, advertising a Beijing-based fashion label, features a presenter selling the benefits of a black-and-white check dress. In the background, words pop up telling you that other viewers have bought the same dress, and an insert image  appears at the bottom of the screen with two prices: 429 Chinese yuan (about $68) and 339 yuan ($53.60). 

Clicking on this image brings up more photos, a purchase button, and a note that the cheaper price is a Xiaohongshu-only special price.

This integration — from viewing to buying — is something that Xiaohongshu has finessed over the years and something that current ecommerce and social media apps have yet to perfect, experts told Insider.

The logic is similar to Instagram: shoppers trust personal endorsements, even from celebrities and influencers they've never met, in a landscape rife with fakes and poor-quality goods. 

Xiaohongshu has captured an estimated 15% of online ecommerce in China, according to Simon Tye of market research agency Consumer Search Group. 

Now it hopes to appeal to a foreign audience — giving established US players like Instagram a run for their money.

Read the full story: A popular Chinese app hailed as the next Instagram counts Kim Kardashian and Eileen Gu as users. Sources say it's launching overseas to reach global users.

Have a tip about Chinese or Asian tech companies? Contact the reporter, Weilun Soon, at [email protected].

Read the original article on Business Insider