Taobao integrates with Xiaohongshu to move into content generation

Tingyi Chen New WeChat features

On November 27th, Taobao started integrating with Xiaohongshu on its product description page.

Earlier in May 2018, Alibaba led the 300 million USD funding round of Xiaohongshu. The marriage of the 2 platforms is inevitable.

But how exactly will this impact the social commerce space?

Taobao’s first attempt to connect to Xiaohongshu

The “Mega-Mashroom treatment lotion” from Origin was one of the first products to benefit from the Xiaohongshu/Taobao integration. Right before the product description section, a new section called Good goods comment (好物点评团) leads users directly to Xiaohongshu’s user generated content.

Taobao users will be able to like, comment and bookmark the Xiaohongshu content, directly from the Taobao App.

It’s unclear how Taobao select the comments that appear on the Taobao App. This lotion has over 27k comments on Xiaohongshu, but only 2 comment appears in Taobao at the moment. It will be interesting to see if the seller gets to select only the most positive comments.

Alibaba’s failed attempt to attract good content

Alibaba’s attempt to include good content on its e-commerce platform hasn’t been smooth so far. Since 2017, Alibaba has tried to copy all kinds of content format: WeChat style social commerce, Douyin style content, Toutiao style new display, live-streaming, machine-generated content… you name it.

Below are a few examples of content formats on Taobao.

Taobao Toutiao (淘宝头条) is the copycat of Toutiao style news display, except with fewer views and less targeted content. Toutiao has stood out through its ability to leverage AI in order to bring the right content to the right user. It seems that Taobao has failed to do that so far.

Must-buy Shopping List (必买清单)is a section recommending content based on the content of users cart. Content is generic and appears as machine generated.

Good Goods (有好货)is another automatically generated content feed focusing informed by users’ browsing history and cart information.

WA-O Video (哇哦视频) is a less hipster version of Douyin, with the sole purpose of selling products.

Taobao live-streaming (淘宝直播) just like the old-school TV infomercials, mostly targets users in lower-tier cities.

Taobao is also trying to import content from the top content brands of WeChat, such as Yitiao and Bazaar. Below are list of KOLs and brands that repost content on Taobao.

KOLs joining the Taobao content ecosystem

Lady Penguin is a wine retail brand started by a KOL on WeChat, Shenhan.

Lady Penguin joined Taobao last year and is already one of the best selling wine distributors on Taobao. She posted content on both WeChat and Taobao.

Shenhan strategy on both platforms is however very different.

On WeChat, the content is more rich and educational. Usually comes with infographics and scientific explanations of a specific learning point related to wine.

But on Taobao, Lady Penguin’s posts are short videos with a link to purchase the wine. The content is casual and fun.

Lady Penguin did gather 32k fans on Taobao, with average video view between 5k to 20k.  However, this is nothing compared with her popularity on Douyin. She has 21 million followers on Douyin, and each video has between 18k to 250k views.

So even for content-focused KOL on Taobao store, the traffic related to content is relatively insignificant. Other platforms such as Xiaohongshu, WeChat, and Douyin remain the main platforms for posting high-quality original content, and Taobao is only good for re-posting content.

What does integration with Xiaohongshu mean for Alibaba?

Xiaohongshu could be the key to bringing high-quality content to Taobao, especially related to higher value products.

Moreover, since Taobao and Tmall are flooded with fake reviews, importing Xioahongshu’s high-quality KOL content could help to add more credibility and increase conversion.

What does this mean for Xiaohongshu?

Ever since the investment of Alibaba in May 2018, Xiaohongshu is adjusting its positioning from a cross-border e-commerce platform back to its origin: a content generation platform for product reviews.

Ever since the investment, Xiaohongshu’s cross-border products are diluted to under 50%. Instead, the platform started to include a lot of smaller domestic brands.

On the positive side, the integration with Taoabo could help brands measure campaign performance. Before the integration, users had to exit the platform to search on Taobao and make purchases. This makes it very difficult to track the conversion rate (if the product is not listed on Xiaohongshu’s e-commerce platform). Once Taobao is integrated, the brand will have a clear vision of sales conversion.

On the other hand, Xiaohongshu is also facing the issue of fake comments and reviews. Once it becomes a traffic generation tool for Taobao stores, it will inevitably start to get even more fake reviews. The platform will have to find a balance between good content and monetization.

Conclusion

Taobao still has a long way to go for attracting good original content, and collaboration with other content platforms such as Xiaohongshu could be the right way out.

The strengthening of Taobao and Xiaohongshu integrations also means that the e-commerce war between Tencent and Alibaba is getting fiercer. While Tencent tries to get into e-commerce, Xiaohongshu will be an essential tool bringing a social component to Alibaba’s arsenal.

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