Chinese social e-commerce app Xiaohongshu is gaining traction in the livestream shopping sector thanks to Chinese actress Dong Jie, who generated over RMB 30 million ($4.3 million) in sales in a livestream on Feb. 24, with many goods costing thousands of yuan per unit.
Dong sold out of all products in six hours. Her performance, seen as less aggressive than those of her livestream shopping rivals, has garnered significant attention for Xiaohongshu, with some observers believing it may have finally found a way to differentiate itself from mainstream e-commerce platforms after quietly launching the livestream shopping feature in mid-2019.
Why it matters: Dong’s success could give Xiaohongshu’s livestream e-commerce business a significant boost, opening up a new revenue stream for the company. Many e-commerce platforms made their livestream shopping breakthrough through star hosts. For example, Alibaba-owned Taobao’s live commerce became a phenomenon after host Li Jiaqi gained mainstream attention; Kuaishou found success through star host Xin Ba.
Details: Although Dong has so far only streamed twice, she sold more than RMB 50 million and RMB 30 million worth of products during the two sessions, according to Xiaohongshu. The celebrity attracted 2.2 million viewers to her latest livestream on Feb. 24. For comparison, Chinese tech celebrity Luo Yonghao attracted 48 million viewers and generated RMB 110 million from his debut on Taobao Live last October.
- Selling high-end fashion items, Dong’s livestream style resonated well with Xiaohongshu’s user base, which comprises mainly urban women with greater purchasing power. As of November 2021, the platform has 200 million monthly active users, with 72% aged below 35 and living in major Chinese cities. The percentage of female users on Xiaohongshu was around 70% in 2022.
- Compared to livestreams on other Chinese platforms, Dong’s featured pricier goods, such as apparel, jewelry, and cosmetics, mostly priced at more than RMB 300, with some branded clothing items even going for as much as RMB 5,000. For example, one of the outfit combinations she tried on sold for nearly RMB 10,000.
- This is a much higher price point compared to rival platforms. Users on average spent about RMB 100 to RMB 300 per livestream on the three main platforms Taobao, Douyin, and Kuaishou in 2021, according to a report from the research arm of Ping An Securities.
- “Dong Jie streams in a soft and quiet voice, and it’s the most comfortable livestream I’ve ever seen,” one viewer wrote on Xiaohongshu. Dong’s livestream was in keeping with the tone of her Xiaohongshu account, which she created in January 2021 and has used to share her personal outfits, skincare tips, and recipes over the course of nearly 150 posts.
- In 2022, Xiaohongshu saw the number of live streamers on the platform grow 337% year-on-year, and the number of live shows increase by 214%, the Shanghai-based firm announced on March 6.
Context: Xiaohongshu’s income heavily depends on digital advertising, with 80% of its revenue in 2020 coming from ads, and the rest coming from e-commerce, according to figures from Chinese research firm LeadLeo cited by the Financial Times.