The split personality of Rednote and Xiaohongshu
Some answers to burning questions about Xiaohongshu's internationalisation
Original image by Robin Higgins.
Content
Things that caught our attention
According to a Kantar Worldpanel and Bain & Company 2024 China Shopper Report, FMCG e-commerce in China stagnated in the first 3 quarters of 2024. Ed summarized some of the findings in a note.
Meituan has launched a new initiative in Beijing: a meal delivery service called Huanxiong Shitang (Racoon Canteen). This service allows Meituan users to order meals from multiple merchants at once. Read about it in our note.
Because TikTok users have migrated to Xiaohongshu, we have removed the paywall on our 2023 report. Ed has also shared his thoughts about the migration's sustainability on his ChinaTalk website, and Mediacat interviewed him about it.
WeChat is reviving its e-commerce plans, including a new gifting function that allows users to send gifts to friends from WeChat stores. Read more about WeChat’s plans in our note. Meanwhile, JD has also launched a gifting function.
The Strait Times and The Wire interviewed Rui about short video dramas, and The Wire interviewed Ed about Luckin Coffee.
Community Group Buying has seen a substantial decline in sales volume in 2024. In a note, Ed summarizes an explanation for this trend.
Introduction
While working on a series of new reports about TikTok Shop and reviewing the source material in our partner Six Degrees Intelligence database, I came across an expert interview about Rednote. Unless you have been living under a rock, you must be aware of the ‘TikTok Refugee’ trend that occurred this month. Americans who feared TikTok's shutdown were looking for an alternative and ‘fled’ to an app that somebody recommended: Rednote.
We won’t discuss the phenomenon here, as enough has already been written about it. We were also not planning to do another in-depth report on Xiaohongshu since there was little new information to share since our March 2023 report, ‘The Rebirth of Xiaohongshu.’
Still, the trend left us with many questions. When was the app’s name changed to REDnote? Was Xiaohongshy actively working on an international version, or was this a happy accident? Are REDnote and Xiaohongshu the same? What are the plans for REDnote? Are they pleased with the trend, or do they see it as a potential risk that could get them in trouble with Chinese authorities?
A few of these questions were answered in an expert interview with a manager of Xiaohongshu. The interview also sheds some light on the competition between REDnote and Bytedance’s Lemon8. We decided to share some excerpts in an additional newsletter and added some insights.
We hope you enjoy this additional short report on top of our regular publication schedule. Next Friday, we will return with the first of three weekly reports on TikTok Shop. The report below is free for all readers, but please consider getting a paid subscription to support our work and get full access to the upcoming reports.
Cheers,
Ed Sander – Research Editor
Who are you? Xiaohongshu? RED? REDnote? rednote?
A few weeks ago, news broke that an app called ‘REDnote’ became the most downloaded free app in the US on January 14th 2025. Those who follow Chinese social media closely were taken by surprise. Wasn’t Xiaohongshu, which proved to be the company behind REDnote, using the name RED for international purposes?
When I checked the Google Play store, I found that it indeed used the name REDnote, which had seemingly spread among American TikTok users. So, what came first? The migration or the name change? Some people thought that Xiaohongshu must have changed it because of the ‘TikTok refugee’ hype, that the first person who mentioned it had made a mistake, and that Xiaohongshu had decided to make the best of the momentum.
I decided to do a Google search and added some period parameters. While there wasn’t much content about REDnote, I did find a handful of references in November and December. When I checked the source data of the pages, I discovered that they had not been recently changed.
Captures on WayBackMachine proved that the name had indeed been changed by Xiaohongshu itself somewhere between June and September 2024.
WayBackMachine June 2024: the app was still called Xiaohongshu. [1]
WayBackMachine September 2024: the app was renamed REDnote. [1]
WayBackMachine Jan 21st 2025: the app’s name has been changed to lower caps. [1]
The following excerpts from the expert interview with the Xiaohongshu manager, shortly after the app shot to the top of the app store charts, confirm that the company was already working on an international version with the name REDnote. I have added some remarks between brackets.
Xiaohongshu’s international offerings
Since 2018, Xiaohongshu has expanded into the international market and designed several applications specifically for different regions. REDnote is mainly aimed at the European and American markets, Uniik is designed for Japanese users, Spark focuses on Southeast Asia, and Catolog adopts a blog-like format.
Overall, Xiaohongshu's expansion in overseas markets was relatively slow, especially before 2023; resource investment and user stickiness were unsatisfactory. Specifically, Uniik is a Japanese social platform similar to Xiaohongshu, which currently has about 100,000 users. However, there is still a significant gap compared with competitors Lemon8 [a product by Bytedance] and Pinterest. Although Spark mainly targets the Southeast Asian market, its community activity and user loyalty are not ideal. Among Xiaohongshu's overseas products, REDnote performed the best, received the most resource support, and is the fastest-growing platform.
REDnote and China's Xiaohongshu are two completely independent platforms, and the user account systems are not connected. [It does, however, seem to overlap in content as Americans can see content and comments from users in China and the other way around.]
Rednote or Xiaohongshu?
REDnote's growth in the US market is impressive. By the end of 2024 [before the ‘TikTok refugee’ trend], REDnote's number of users in the US reached 670,000, and just over a month later, by January 17, 2025, this number had more than doubled. This rapid growth momentum is worth paying attention to. In contrast, Xiaohongshu's user growth rate in the domestic market is about 5%. Although this growth rate may not seem high, considering Xiaohongshu's massive user base in China, the actual growth number is still considerable. This shows that even with a relatively low growth rate, Xiaohongshu maintains a steady development trend in the domestic market.
Recently, due to the imminent TikTok ban, some American users downloaded the Chinese version of Xiaohongshu through the App Store and posted content on it. These users may not have posted on REDnote. [This is a remarkable claim as searching for ‘Xiaohongshu’ or ‘小红书’ gives ‘rednote’ as a result, at least here in The Netherlands.]
The availability of the Chinese version of Xiaohongshu in the United States is not recent but was developed in the early days for the convenience of overseas Chinese. Before the release of the international version of REDnote, overseas users could download the Chinese version of Xiaohongshu, but this does not mean there is a clear strategy to attract overseas users.
As more overseas users begin to use the Chinese version of Xiaohongshu, this trend could benefit the platform, including introducing more diverse content to the domestic community and enhancing its overall influence. At the same time, the content recommendation algorithm of the Xiaohongshu domestic community has changed significantly, from highly similar content to a more diverse and rich presentation. Users can now browse more content from various fields, including some overseas bloggers' posts.
This trend has attracted the attention of advertisers, especially in the US market, where some advertisers have begun to promote products such as games and artificial intelligence social tools to iOS device users. Some foreign users also obtain the Chinese version of Xiaohongshu through unofficial channels. These changes have undoubtedly brought new opportunities and challenges to the development and operation strategy of the Xiaohongshu platform.
As Xiaohongshu's main international product, REDnote has achieved remarkable results in the European and American markets. Compared with the domestic version of Xiaohongshu, REDnote's marketing strategy is more effective because it has a clear target audience and supports a complete business chain. Through programmatic advertising sales, REDnote has obtained a stable source of income, thereby improving the sustainability of its business model.
However, REDnote is significantly inferior to the domestic version of Xiaohongshu in terms of content quantity, user activity, and operating resources. Therefore, to achieve long-term sustainable growth, the future development of REDnote requires continuous improvement of the content ecosystem and optimization of operating strategies.
REDnote versus Lemon8
Among Xiaohongshu's overseas products, Uniik and Spark perform worse than Lemon8 and Pinterest in terms of investment and user activity. Regarding team size, REDnote has a relatively small team of less than 30 people and is headquartered in Shanghai. In contrast, Lemon8 has a larger team of more than 100 people and has local operation teams in multiple countries. This difference in team size is also reflected in resource allocation and overall operational strength, where REDnote has a clear gap compared to Lemon8.
In 2024, REDnote and Lemon8's advertising strategies differed significantly. REDnote plans to invest about $710,000 in major advertising platforms, and its annual budget is expected to be between $1.4 million and $1.5 million, mainly for performance advertising and a small amount of brand advertising. In contrast, Lemon8 has invested more heavily, with monthly advertising expenditures ranging from $600,000 to $800,000 and total annual spending of up to $8.75 million, covering multiple advertising channels.
Regarding daily advertising expenditures, REDnote spends over $10,000 on advertising daily, mainly in the US market. Lemon8 has spent $40,000 to $50,000 on advertising daily since Christmas, but Bytedance's promotion campaign is expected to end in January. Bytedance regards Lemon8 as a product as crucial as TikTok and has invested far more resources than REDnote. This differentiated investment strategy may significantly impact the market performance and user growth of the two platforms. Lemon8 has surpassed REDnote regarding promotion efforts and resource investment, which may help Lemon8 gain faster user growth and market share in the short term. However, REDnote's strategy may focus more on long-term steady development and precision marketing.
Lemon8's recent performance is worthy of attention. The platform has repeatedly topped the free list, which shows that users have recognized its content and operation strategies. This successful experience may provide some reference and inspiration for REDnote to improve its position and attractiveness in the market.
Challenges
Xiaohongshu's future development in the international market is still uncertain. Xiaohongshu faces multiple challenges in its internationalization process, which significantly impact its development and monetization strategy in the US market.
First, due to language barriers, Xiaohongshu's user base is mainly Chinese, which is not very attractive to non-Chinese native users. In general, Xiaohongshu has limited appeal to non-Chinese native users, which is an essential challenge it needs to overcome in internationalization. This language limitation affects Xiaohongshu's expansion in the international market.
Xiaohongshu has not been fully optimized in providing services for non-Chinese users. Although part of the interface is in English, the overall functions and content are still imperfect. In addition, there is less English content in the recommendation system, which is mainly in Chinese, which makes it inconvenient for foreign users to integrate into the community. Many videos are unavailable for foreign users to watch, and there is a lack of cross-border e-commerce functions, affecting the user experience. Foreign users mainly rely on self-translation or use English to communicate with Chinese users, and their use is restricted. [REDnote recently added a translation functionality for comments].
Second, due to the complexity of accounting processing, Xiaohongshu encountered difficulties in monetization during the download process of the US App Store. At the same time, the logistics system has not been fully connected, which makes it impossible for US consumers to make cross-border purchases through the domestic version of Xiaohongshu.
Furthermore, American consumers' potential rejection of Chinese products may affect the development of REDnote. However, some Americans' interest in imported products may provide short-term growth opportunities for REDnote.
Third, Apple’s IDFA (Identifier for Advertisers) policy impacts the tracking of cross-border advertising effects. Game apps have become inaccurate in measuring conversion rates. When conducting cross-border promotions, Xiaohongshu may encounter a large number of invalid clicks. This is especially true when there is a lack of relevant services in the target country. The advertising effect will be significantly reduced. The actual value of cross-border traffic is not high for advertisers and platforms.
Fourth, the international version faces regulatory challenges. Although the domestic version has attracted many overseas users, the review mechanism has not been fully established, and future development is uncertain.
Fifth, the growth of Xiaohongshu's overseas users is mainly driven by their curiosity about the new platform rather than their long-term plans to use it. To retain some users, Xiaohongshu needs to improve its products. Xiaohongshu has encountered difficulties in internationalization and was considered to have abandoned the process in 2023. Although it was restarted later, the effect was not ideal.
These challenges may affect Xiaohongshu's long-term development prospects in the overseas market, and the company needs to take adequate measures to overcome these obstacles.
Sources
This report contains excerpts from an exclusive expert interview from the Six Degrees Intelligence network, augmented by the article below.
[1] Wikipedia
I am a user of xiaohongshu since 2016. Xiaohongshu’s content is what’s missing in US market. Restaurant reviews, international travel tips, shopping tips in text format r not something Yelp, google review, trip advisor can compete. Once RedNote figures out how to get Americans to use it, it will fill a significant gap and be an excellent monetization opportunity.