Xiaohongshu Turns Rival Into Distribution Partner
Xiaohongshu
This partnership shows Xiaohongshu winning by owning product discovery, while Alibaba keeps the checkout. Xiaohongshu users already used the app like a place to see outfit posts, beauty reviews, and shopping tips, then left to buy on Taobao or Tmall. The May 2025 link integration turns that old leakage into a cleaner path, so merchants can move a user from a post to a purchase with fewer steps, without Xiaohongshu having to build Taobao scale payments, seller tools, and fulfillment from scratch.
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For years, Xiaohongshu monetized mostly through ads, while much of the transaction happened elsewhere. That made it strong at influencing demand, but weaker at capturing commerce value. Embedded Taobao and Tmall links let it keep the social feed as the top of funnel and make that influence easier to measure and sell to merchants.
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This is a different model from Douyin. Douyin built a more closed shopping system and pushed harder into in app commerce. Xiaohongshu is taking a lighter approach, acting more like the place where intent is created, while a partner with deeper transaction infrastructure handles payment and order completion.
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For Alibaba, the deal is a traffic acquisition move. Taobao and Tmall get access to Xiaohongshu's high intent beauty, fashion, and lifestyle audience at the exact moment users are saving products and looking for peer recommendations, which is more valuable than buying generic ad impressions after demand has cooled.
The likely end state is a more specialized Chinese commerce stack, where Xiaohongshu becomes the habit forming discovery layer and large marketplaces become the transaction layer behind it. If this flow keeps converting, Xiaohongshu can raise merchant monetization without becoming a full marketplace, and Alibaba can defend share by plugging directly into where purchase intent now starts.