Xiaohongshu (Rednote) after the TikTok Refugees’ dust has settled
A look at the impact of the trend on Xiaohongshu’s internationalisation and cross-border plans. Plus an update on its domestic goals.
Contents
Things that caught our attention
Rui Ma was a guest on The Negotiation podcast with Todd Embley to talk about the US-China AI race. You can listen to the two parts of the episode below.
Rui was also interviewed by Channel News Asia about the unexpected popularity of Chinese webshops like DHGate. You can read the article here and read Rui’s note on the matter here.
History repeats itself as Meituan Xiao Xiang opens offline stores
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Introduction
Last January, in the midst of the ‘TikTok refugee’ craze, we published an article that attempted to answer some of the questions about the international version of Xiaohongshu, Rednote.
In the past months, we have uncovered some new insights that we would like to share with you. This article takes another look at the question of whether Rednote and Xiahongshu are separate apps, evaluates the impact of the influx of TikTok Refugees and the platforms’ plans for internationalisation. It also examines Xiaohongshu’s recent ventures into cross-border e-commerce. And while we are at it, we also update you on Xiaohongshu’s 2024 results in its domestic market and its plans for 2025.
The text below is partially taken from interviews with staff members of Xiaohongshu's overseas operations at the end of January. From the impact analysis onwards, the article is accessible to paid subscribers. Please consider supporting our work and getting a paid subscription as well.
Cheers,
Ed Sander – Research Editor
Same same, but different
To start, let’s look again at the question of whether Rednote and Xiaohongshu are the same app.
Xiaohongshu faces fierce competition in the international market. In the Chinese market, it competes with Douyin and Weibo, while in the North American market, it faces challenges from YouTube, Instagram, and the popular TikTok. Unlike Douyin and WeChat, which adopt a dual-version strategy, Xiaohongshu has chosen to use a single version to serve global users through the same app. Xiaohongshu shares a database system in the domestic and international markets.
The purpose of this unified design is to simplify the user experience, improve work efficiency, and build a strong global ecosystem. This unified global app strategy has an essential impact on the development of Xiaohongshu and helps it establish a more consistent and powerful brand image in the international market. The content of the international and domestic versions of Xiaohongshu is the same, and the only difference is the language interface, so there is no need to release separate versions.
Even before the TikTok Refugees trend, Xiaohongshu achieved globalisation through a unified platform, initially attracting many Chinese students and overseas Chinese. Unlike TikTok, which needs to set up a branch in North America, Xiaohongshu thinks it reduces regulatory risks through a unified platform. If an independent overseas business unit is established, expenses will rise by 40% to 50%. In general, Xiaohongshu has adopted a cautious and effective internationalisation strategy while maintaining its core advantages; it is also gradually expanding its global influence (see ‘Internationalisation?’).
Xiaohongshu currently has no plans to make operating in different regions in overseas markets a priority but continues to focus on developing the domestic market. The company has a small number of employees, about 4,000 to 5,000, which is minimal compared with its competitors. This only allows them to focus resources on their core business. Launching a new international version would take a lot of resources while using the existing version can significantly reduce expenses. In addition, dividing operations into multiple versions may increase management complexity and the difficulty of collaboration between departments.
Xiaohongshu does allow eligible overseas users to turn on the live broadcast function, but they cannot currently earn income through rewards or advertising. Overseas users need to pass identity verification to obtain live broadcast permissions. Suppose overseas users want to receive reward income. In that case, they need to sign an employment contract with a content agency in China, and the income will be regarded as wages and subject to personal income tax. The income from personal accounts is viewed as labour remuneration and is subject to individual income tax.
Since relevant policies have not been fully liberalised, Xiaohongshu's commercialisation function is still experimental. In terms of technical architecture, Xiaohongshu relies on Alibaba Cloud as its primary cloud service provider to ensure the server's normal operation and achieve load balancing. Xiaohongshu enhances the system's stability and scalability by using a distributed architecture to allocate each functional module to an independent node. This system was developed by Xiaohongshu's internal team and uses Alibaba Cloud's resources to handle faults and improve performance.
Regarding data storage, Xiaohongshu has not yet decided how to store overseas data and may adopt a dual-line mode: domestic data is stored domestically, and overseas data is stored locally. This dual mode will not affect the cross-border usage experience but will only change the physical storage location of the data. Still, it may need to be adjusted according to policies in the future.
Xiaohongshu developed a translation feature and rolled it out on January 19th, the same day TikTok returned online after about half a day of absence. Earlier reports suggested that some Xiaohongshu teams had been working overtime since Jan. 13 to handle the sudden surge in user traffic and translation demands. [1]
The new feature is not a typical machine translation tool but an AI-powered model. The translation function handles Chinese-to-English and English-to-Chinese translations and identifies and explains common internet slang terms. Besides English, German, and French, the translation feature appears capable of handling a wide range of languages. [1] XHS recognises that the translation function is crucial to attracting international users, so it is increasing its investment in artificial intelligence.
Xiaohongshu User Statistics
Compared with major social media platforms in the United States, Xiaohongshu's user scale and growth are impressive. By January 2025, YouTube's daily active users was 155 million, Facebook's 127 million, TikTok's 85 million, Instagram's 63 million, and Twitter's 26 million. In contrast, Xiaohongshu's global daily active users reached 143 million by the end of 2024, a YoY increase of 32.4%; the monthly active users was 376 million, an increase of 30.5%.
The average usage time of Xiaohongshu users has also increased significantly, reaching 76.4 minutes, an increase of 17.9% YoY. Daily post views have reached 9.12 billion times, an increase of 41.4%.
The rest of this report is available to paid subscribers.