Source | YuanSight

Overnight, Xiaohongshu transformed into a phenomenon.

On the evening of January 13, Xiaohongshu successfully topped the free app chart on the US Apple App Store. Between January 12 and 13, its downloads surged by nearly 300% on the US App Store, and daily active users increased by over 300% in the US market, with over 70% of new users coming from TikTok.

In the past two days, Xiaohongshu has continued to display robust momentum. According to data from Qimai, on January 14, Xiaohongshu ranked first in the overall free app downloads chart on the App Store in the US, Jamaica, and Kenya, and entered the top 10 in 22 other countries and regions.

It can be said that due to the influx of TikTok users, Xiaohongshu became an overnight sensation overseas, becoming another Chinese app, after TikTok, to successfully penetrate the US market.

Although algorithm-driven platforms, exemplified by short videos, have nurtured a series of drawbacks such as information cocoons during their operation, they have undeniably altered users' lifestyles. After being exposed to algorithm-recommended content for an extended period, users gradually become accustomed to and addicted to this digital existence. Consequently, when TikTok is absent from the lives of American netizens, the latter are likely to experience withdrawal symptoms.

Judging from the performance of major US internet giants, the outside world has underestimated users' addiction to TikTok's algorithm, and they are currently unable to directly absorb the traffic from TikTok.

01

Xiaohongshu Wins Big

According to media reports, the US government has demanded that ByteDance spin off TikTok's US operations by January 19, or else a nationwide ban will be implemented, prompting TikTok's US users to seek new social platforms.

Due to internal and external factors, Xiaohongshu has emerged as the choice for many American netizens. On one hand, Xiaohongshu features refined content and robust community interaction. Its algorithm is highly sensitive and precise, enabling users to efficiently access content of interest, and it shares similarities with TikTok. On the other hand, many American users have chosen Xiaohongshu, a genuine Chinese app, in protest against the US government's ban on TikTok.

According to YuanSight observations, in the afternoon of January 13, there were only over 2,000 posts under the topic "tiktokrefugee" on the Xiaohongshu platform, with a total view count of approximately 390,000. By the time of publication on January 14, the number of posts under this topic had exceeded 60,000, with a total view count of over 27 million and over 850,000 discussions. Additionally, there were about 12,000 posts under the topic "tiktokban," with a total view count exceeding 10 million.

The popularity of Xiaohongshu has also fueled a collective surge in related tech stocks on the market. On the morning of January 14, A-share related stocks such as Remote Technology and Yingli Media saw their trading prices reach the daily limit, while Tianxia Show and Huayang Union also hit the daily limit after opening, and Diansheng Stocks rose by over 8%.

Amid the warm welcomes from Chinese users, these American "internet refugees" from TikTok have felt the enthusiasm of Chinese users. In some American users' posts, there are frequent instances of interesting interactions, such as Chinese elementary school students asking American users for help with English homework in the comments section, turning Xiaohongshu into a free "online foreign teacher" platform. Some American users also proactively inquire whether any Chinese netizens need help with English homework.

To better integrate into the Xiaohongshu ecosystem, many American users use translators to post Chinese captions, and some can even speak fluent Chinese. They actively learn popular Chinese internet buzzwords and cultural memes, such as "Crazy Thursday, V me 50," and use them in their posts to align with the platform's language and expression styles.

02

Algorithm Refugees

Setting aside other considerations, it appears that the current crop of US internet platforms is unable to absorb the large number of users left behind by TikTok's absence.

As of August 2024, TikTok had 170 million monthly active users in the US. Approximately 36.2% of TikTok users are aged 18-24, and 32.1% are aged 25-34.

Such a vast user base has already formed a closed ecosystem. Users' interactive behaviors on the platform, such as liking, commenting, and sharing, not only provide data references for the algorithm but also enhance social interaction and content dissemination among users, further enriching the platform's content ecosystem.

Judging from the current behavior of users fleeing TikTok, many overseas social or content platforms are still unable to reach the "replacement" level of Xiaohongshu at this stage.

Some American TikTok users stated that they chose Xiaohongshu because they heard it was similar to TikTok and could be used to express dissatisfaction with the government's ban. A blogger named "allieusyaps" expressed that he and other creators would not return to Instagram or Facebook but instead chose Xiaohongshu. He wrote in his post, "Look, I might not have a job next week, but we're learning Mandarin!"

Regardless, the outside world has underestimated the importance of TikTok in the hearts of American netizens.

From a psychological perspective, many users have established social relationships based on shared interests on TikTok, interacting frequently through likes, comments, and co-shoots. After TikTok's absence, these social connections may be disrupted, leaving users with a sense of lack of social interaction and even feeling lonely.

From a practical economic perspective, many creators rely on the TikTok platform to create content and earn income, including advertising revenue sharing and tips. After TikTok's absence, creators' revenue channels are cut off, and they may need to find new platforms and sources of income.

It can be said that these internet refugees from TikTok are truly "algorithm refugees."

An investor who has long been engaged in the TMT sector told YuanSight that the user experience created by TikTok has few substitutes in the market. Since TikTok users have long been accustomed to and dependent on the content precisely pushed by the algorithm, once TikTok is absent, users may experience emotions similar to "withdrawal symptoms," such as anxiety and restlessness, not knowing how to fill the gap in entertainment and information acquisition.

However, although Xiaohongshu and TikTok share similarities in their operating mechanisms, both utilizing data and algorithm technology to analyze users' interests and hobbies based on their browsing, liking, commenting, and other behavioral data to push personalized content to users, they have different focuses. Xiaohongshu emphasizes practicality and reference value, such as product reviews, experience sharing, and guides, while TikTok emphasizes entertainment and fun.

Whether Xiaohongshu can fully absorb this wave of traffic from the US remains to be seen over time.

03

Addictive Dose

The core reason why American algorithm refugees flooded into Xiaohongshu is that Chinese algorithms have deeply penetrated users' daily digital lives.

Like pacifiers, the widespread application of algorithms is reshaping users' digital lifestyles. Short videos utilize big data and machine learning algorithms to precisely recommend content of interest to users. The algorithm constructs user profiles based on users' viewing history, likes, comments, and other behavioral data, enabling personalized content recommendations. This allows users to quickly find content they like among massive amounts of short videos, significantly enhancing their viewing experience.

However, the overuse of personalized recommendation algorithms confines users within an "information bubble" created by their own interests and preferences. When recommending content, the algorithm often filters based on users' past behaviors and preferences. Over time, the information users receive is limited to areas that align with their own viewpoints, making it difficult to access diverse and differing perspectives, which can further exacerbate biases and misunderstandings, hindering users from forming a comprehensive and objective understanding of the world.

For instance, the Proceedings of the National Academy of Sciences of the United States of America mentioned a concept called the "echo chamber" in a report, stating that social media algorithms reinforce negative thinking patterns, leading to polarized thinking, more arguments, isolation, and misunderstandings, and a narrower and more biased worldview.

At the same time, the algorithm quickly adjusts recommended content based on users' real-time behavior. After users like or comment on a video, the algorithm swiftly pushes more similar content, giving users immediate satisfaction. This immediate feedback acts like a "reward," stimulating users to continuously browse and crave more "rewards," thereby falling into a cycle of constantly watching short videos and finding it hard to stop.

This is particularly serious for teenagers with relatively poor self-control. A survey conducted by the Pew Research Center found that when children are anxious or depressed, they tend to browse more negative information, but short video algorithms push more negative information, leading them to be gradually consumed by the algorithm in such a vicious cycle.

As a result, users are bound to become addicted to short video platforms. The various actions taken by the US government against ByteDance and TikTok objectively caused a "withdrawal reaction" among many American short video users.

For algorithm refugees, leaving the virtual world deconstructed by algorithms, they may not know how to actively search for content of interest. Accustomed to the algorithm precisely pushing information on food, travel, and other aspects, they may feel at a loss when suddenly required to search and filter content themselves, potentially getting lost in the sea of information.

Xiaohongshu suddenly becoming a replacement for TikTok has, to a certain extent, helped algorithm refugees achieve a soft landing. Although it cannot completely replace TikTok in terms of detailed functions, it can provide them with temporary relief.

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