Xiaohongshu redefines China’s e-commerce with a focus on luxury and aspirational products

For eight years, Tera Feng has shared her glamorous Shanghai lifestyle with over 500,000 followers on Chinese social media. Her audience, primarily financially independent urban women, has proven to be a valuable market for high-end and niche brands. In recent months, Feng’s switch to livestream selling on Xiaohongshu, a platform similar to Instagram, has seen her sell products ranging from luxury suits priced at 15,000 yuan ($2,060) to premium rice costing 60 yuan per kilogram.

Xiaohongshu has long been used for lifestyle inspiration but has struggled to find success in e-commerce. As Chinese consumers on other platforms like Taobao and Pinduoduo hunt for discounts, Xiaohongshu attracts a different crowd — users willing to spend on quality and aspiration-driven products. Influencers and brands are embracing this trend, with companies like L’Oreal and Coach launching stores and partnering with livestream hosts to drive sales. These livestreams adopt a relaxed, conversational style, contrasting the aggressive sales tactics on other platforms.

Brands are seeing tangible results. For example, Ms Min, an independent fashion label, experienced a spike in sales after actress Dong Jie featured it in a livestream. Marketing agencies like Magic Advertising, which works with luxury clients like Max Mara and LVMH, are also eyeing Xiaohongshu for growth. While analysts predict the platform’s annual sales could surpass $100 billion by 2025, experts suggest it will remain a niche player compared to China’s e-commerce giants like Tmall and JD.com. Nonetheless, Xiaohongshu’s ability to connect luxury brands with eager, affluent consumers marks it as a growing force in China’s online retail landscape.