Is Xiaohongshu killing vertical communities?

In the evolution of the Internet content ecosystem, vertical communities have been gathering places for users in niche areas, attracting a large number of loyal users with professional content and precise positioning. However, with the rise of comprehensive content platforms such as Xiaohongshu, the living space of vertical communities is being gradually squeezed. This article will explore in depth how Xiaohongshu attracts users and creators of vertical communities with its diverse content ecosystem and powerful algorithm recommendations, as well as the challenges faced by vertical communities in the commercial dilemma.

The wave of "TikTok refugees" on Xiaohongshu has basically subsided, but the diverse community's ability to break barriers still left a deep impression on the outside world.

"Diversity makes the entire community stronger." As early as 2008, Douban founder Abei was thinking about the community ecology issue. In his view, Douban is already a place where a variety of people, from "high school students obsessed with anime" to "retired Chinese studies enthusiasts," live together. "Douban is losing the center of public attention in the process of diversification. This is good, and we are wholeheartedly promoting it."

Three years later, in 2011, Abei made another judgment in a speech at Innovation Works that it is difficult to expand vertical SNS based on interests because the frequency of a single interest is too low. People usually have many interests, and it is actually rare to interact with people with a certain interest too frequently. For this reason, Douban gave up the travel product "Woqu".

In 2011, just after Woqu was abandoned, the travel community Mafengwo had more than 2 million registered users and completed its A round of financing. That was the golden age of vertical communities, and even Douban employees joined in. In 2011, Douban designer Wang Xusheng resigned and founded the food community Xiachufang. In 2013, the overseas shopping sharing community Xiaohongshu was launched.

In 2015, the home sharing community "Haohaozhu" was launched.

Looking back at Abei’s two predictions from 2025, they are quite accurate: most of the vertical communities that were once glorious are now or are on their way to decline; but the product that proves that diversification is the right path is not Douban, but Xiaohongshu, which has 300 million monthly active users.

01 The community track cannot accommodate small and beautiful?

"I'm a little worried that the Xiachufang app will go bankrupt, because I've been using it for so many years without spending a penny." "Don't worry, Xiachufang came from Douban, and it has inherited Douban's fine tradition of neither becoming popular nor dying."

The interesting thing about this interaction on Xiaohongshu is that it not only describes the current situation of vertical communities, but also inadvertently reveals the root cause behind the current situation: even discussions about vertical communities take place on Xiaohongshu, and behind this is the fact that more and more users and transactions are flowing from vertical communities to Xiaohongshu.

A little-known fact is that as early as February 2020, the DAU of food consumption once exceeded that of beauty products, becoming the largest vertical category in the Xiaohongshu community.

Taking the home furnishing category as an example, in 2023, Xiaohongshu built a home furnishing buyer business team from 0 to 1. In less than a year, it produced top amateur buyers such as "Yike KK" whose 618 transaction volume exceeded 100 million yuan, "Youyang Aesthetics" with a tens of millions level, and "Miss Wild Persimmon" with a single-session transaction volume of over 13 million.

▲"One KK" has grown into a super buyer in the home furnishing field of Xiaohongshu

During the Double 11 shopping festival last year, Xiaohongshu’s home furnishing buyer manager told NoNoise that they were considering integrating the home furnishing business ecosystem, which includes not only live streaming but also offline service scenarios and the connection of overall resources. “Community and other business sectors also have this (integration) demand.”

This is because the home furnishing content on Xiaohongshu not only involves the promotion and trading of furniture and home furnishing products, but also includes multiple service scenarios such as decoration design. If Xiaohongshu is able to connect offline and online, its reach into the home furnishing business will undoubtedly be extended.

People support transactions. Relying on the community, the output of a large number of home content creators has given Xiaohongshu a strong consumer mindset for home content. McQueen, head of Xiaohongshu's e-commerce merchants, previously said that there are 120 million users seeking purchase advice on the site every month, and the most common questions are "How is it?" "How much?" "Where to buy?"

On the other hand, Haohaozhu, a home furnishing community founded in 2015, has long become the "tears of the times." In the eyes of an early user with nearly 30,000 "Zumyou" followers, Haohaozhu has opened a new era of domestic home furnishing aesthetics. It has a nostalgic community cultural atmosphere and is the most important base for domestic home furnishing enthusiasts. Many well-known home furnishing bloggers on Xiaohongshu come from Haohaozhu.

▲The whole house cases recommended by Haohaozhu every day

"Home is a Little Forest" is the most popular group on the Haohaozhu platform, but now the latest posts on the homepage basically have 0 comments, 0 favorites, and 0 likes. A Haohaozhu user lamented, "In 2016, I shared my home renovation on Haohaozhu and was fortunate to be named a living model and gained nearly 10,000 fans. Now I have moved to a new home and posted a whole house again, but no one is interested."

The one that is doing slightly better than Haohaozhu is Mafengwo, a travel vertical community founded in 2006.

On the homepage of Mafengwo, there is a section called "Fengshou". According to Mafengwo's founder Chen Gang, this "best position" is reserved for users who can produce high-quality content. If a user can be on "Fengshou", it means that their content has a high level of interaction. In 2014, because there was too much high-quality content, Mafengwo had to schedule posts that could be on "Fengshou".

Today, the heyday is no longer there. Taking February 2025 as an example, the number of likes, comments, and collections for the most interactive post were 1991/66/875 respectively, while the number of comments for the other posts were all in double digits. The number of likes for the post with the lowest interaction was only 1078.

▲Users’ evaluation of Mafengwo App in an official Android phone software store

Let’s look at Xiaohongshu. According to the “2023 Tourism Consumption Content Research Report” released by iResearch, 82.4% of travelers tend to browse online guides before traveling, and the community that spends the most time and energy is Xiaohongshu.

User loss is an "unbearable burden" for vertical communities, but it is also the fate of vertical communities. In 2011, Chen Gang said in an interview, "If there is not enough content in the early stage of a travel community where users contribute content, how can we attract users? If there are not enough users, who will contribute information?"

The question of which came first, the chicken or the egg, hangs over the heads of all vertical community entrepreneurs like a sword of Damocles. Chen Yan, then operations director of Guokr.com, once pointed out in a speech that "the core and source of vitality of vertical communities are users, but their subsequent development is also limited by users - vertically segmented user groups do make the community positioning clearer and more targeted. However, the insufficient target user base and the increasingly saturated market are also a stumbling block to the subsequent development of vertical communities."

In other words, when vertical communities develop to a certain stage, they will inevitably reach the ceiling of user growth, which is determined by the natural attributes of vertical communities. Externally, the disappearance of the domestic Internet traffic dividend has also increased the difficulty of vertical communities in expanding the scale of their user groups. Chen Gang once said frankly, "The customer acquisition window that supports the growth of a platform has closed."

On the one hand, user growth has encountered a bottleneck. On the other hand, as Abei pointed out, the frequency of a single interest is too low, and it is difficult for users to frequently use vertical communities based on a certain interest. As a result, it is difficult for the platform to accumulate loyal users. This is also a "natural defect" of vertical communities.

However, in Chen Gang's opinion, it is not a bad thing that most users go to Mafengwo to find what they want when they need it instead of spending all day here. Mafengwo has a translation product called "Travel Translator". It is said that the internal development of this product did not consider the cost and revenue too much.

"We are travelers ourselves, and we think this will be helpful to travelers, so we do it." Chen Gang's mentality is a microcosm of many early vertical community entrepreneurs. They are relatively Buddhist and even a bit lazy.

In an interview in 2020, Wang Xusheng, founder of Xiachufang, mentioned, "In the past, we never managed channels at all, that is, where our app downloads came from. The distribution channels also stopped about four or five years ago, and the growth has always come from user word of mouth. Word of mouth is difficult to track, so we simply didn't track it in the past."

Chen Gang and Wang Xusheng’s ideas were not wrong, or rather, their idealism and Buddhism were just in line with the “small and beautiful” vertical community. However, they probably did not expect that the algorithm-based head platform would bring an all-round dimensional attack to the vertical community.

02 Shadow of the head platform

In 2008, Abei proposed a concept - "segmentation". He believes that "hotspots" are meaningful only when people with different interests can be differentiated from each other. Just like a city with a variety of people is more vibrant. These people need to communicate conveniently and be effectively segmented. Without segmentation, there is no diversity.

▲ An offline salon held by Douban in August 2016

Image source: Douban official microblog

Xiaohongshu and other platforms have perfectly implemented Abei’s original idea - gathering people with similar interests while ensuring the diversity of content categories. Compared with entrepreneurs in other vertical communities, Abei is closer to Xiaohongshu, but he has not been able to find the transportation he needs to reach his destination.

Wang Xusheng, founder of Xiachufang, once reflected that in the past, the company had always focused on understanding users, but had not paid attention to some changes in the industry. This change refers to the recommendation algorithm. When Toutiao was first launched, Wang Xusheng's first reaction was that it was not that efficient.

This is obviously a misjudgment. Generalized content communities represented by Xiaohongshu, Bilibili, Douyin, and Kuaishou, which rely on data mining and personalized algorithms to build content aggregation platforms, soon had a huge impact on vertical communities with their traffic advantages.

First, personalized recommendations have helped platforms like Xiaohongshu gain more new users. According to Geek Park, Xiaohongshu began to introduce algorithms in 2016 in order to recommend UGC content to more users. This allows more ordinary users to be seen by users with the same interests and even interact with them.

The user size and monetization efficiency of the leading platforms form a siphon effect on vertical community creators. Creators of vertical communities gradually use the leading platforms for their first release and original creation. The content ecology of the leading platforms tends to be complete, and the content supply of vertical communities is on the verge of exhaustion.

Take "Manshi Manyu" as an example. The blogger joined Xiachufang as early as 2012. She has 795,000 followers on Xiachufang and has shared 598 recipes. She is an absolute top creator. In 2017, "Manshi Manyu" joined Xiaohongshu and continued to update videos. Currently, she has 809,000 followers. Her account on Xiachufang has been completely stopped in April 2023.

After moving to Xiaohongshu, "Manshi Manyu" has at least one live broadcast every month to promote products. In her Xiaohongshu store, 3,210 pieces of a snow pan priced at 194 yuan have been sold so far.

▲The sales of "Manshi Manyu" Xiaohongshu store are quite impressive

When Xiaohongshu and other platforms gather enough diverse vertical creators and precipitate more subcategories, the diverse content produced on the platform will further squeeze the space of vertical communities. Kevin, the initiator of PMTalk Product Manager Community, once pointed out, "Since a user can get almost all closed-loop satisfaction from the diverse content forms and services of the head platforms, why should he go to vertical platforms?"

Qu Fang, founder of Xiaohongshu, once said that the Xiaohongshu community is centered on "people" rather than "content." When a user comes to Xiaohongshu because he likes beauty products and stays on Xiaohongshu because of the community atmosphere, the user's diversified needs will also be extended in the community, and the accumulation of time will naturally lead to the expansion of category content.

Based on the scale of "people", content needs can theoretically be infinitely segmented, and interest tags can be infinitely expanded. For example, topics can be expanded from shopping to beauty, clothing, and then to food, travel, outdoor sports, mother and baby, workplace and other fields.

This expansion not only covers the popular tracks of vertical communities in the past, but also some relatively unpopular subcategories, which have gradually formed a mature user ecosystem on Xiaohongshu. Taking art as an example, Xiaohongshu has become an important promotion and dissemination platform for major galleries, auction houses, artists, curators and even collectors.

Currently, Sotheby's, Christie's, and China Guardian have all entered Xiaohongshu. In May last year, China Guardian even live-streamed the "Collectors' Selection Summit" on its Xiaohongshu account. Last year, the Sun Yidian collector vs. auction house incident that caused a sensation in the art world also started to ferment and spread from Xiaohongshu.

▲ China Guardian previewed the live broadcast on its official WeChat account

It is worth noting that compared with the fields of food, travel, and home furnishing, the information barrier of the art market is relatively high. In the words of industry insiders, "art is the only industry that has not been baptized by technology." The diverse and segmented art interest circles on Xiaohongshu have to some extent changed the problems of poor circulation and difficulty in cashing out artworks. According to public reports, artist Liu Xizi connected with collectors on Xiaohongshu. The platform allowed more people to see her works. "When it was the most intensive, one print was sold every day."

When creators achieve content conversion on Xiaohongshu, it will feed back to their content output. The previous incident of a big UP host on Bilibili stopping updating has indirectly proved the true price of good content. Therefore, the competitors of vertical platforms are no longer other platforms of the same category, but top content platforms such as Xiaohongshu.

Wang Xusheng, the founder of Xiachufang, once said frankly, "When it comes to competition now, the first thing that comes to my mind is platforms that develop the entire information field, such as Xiaohongshu, Bilibili, Douyin, and Kuaishou. Users can solve more problems and reach more points there. Everyone will wonder why the homepage of our Xiachufang is the same as Xiaohongshu, right? We are indeed a little late in quantitative research."

▲ Home page of Xiachufang App

Another company that also regards Xiaohongshu as a competitor is Mafengwo. In 2020, media reported that Mafengwo had always regarded Xiaohongshu as a competitor and had set up a note-taking department. Later, it also made great efforts to develop short video content to defend against Douyin.

Mafengwo regards Xiaohongshu and Douyin as competitors, not only because the latter have divided vertical users and creators, but the more crucial reason is that Xiaohongshu and Douyin both officially entered the hotel and tourism business in 2020, among which Douyin has even regarded the hotel and tourism business as an important monetization area of ​​local life.

03 How difficult is it for the community to make money?

Even if content platforms such as Douyin and Xiaohongshu did not participate in the pie, Mafengwo, which is sandwiched by OTA platforms such as Ctrip, Qunar, and Fliggy, is not having a good time. Since its establishment, Mafengwo has never solved the commercialization problem well. The weakness in commercialization is one of the reasons for the decline of vertical communities represented by Mafengwo.

Mafengwo's early revenue came from advertising. In 2015, Mafengwo adopted the "content + transaction" model, providing users with travel-related content while selling related travel products.

In the same year, Chen Gang said in an interview that OTA platforms such as Ctrip were engaged in a price war, "not hesitating to convert their profitability into a loss-making situation in exchange for market share. But this may only be a temporary product." He believed that the biggest opportunity for China's online tourism in the future would be in the personal leisure, vacation, and tourism markets, rather than the simplified and standardized air ticket and hotel business, so Mafengwo focused on free travel products at the time.

Three years later, Mafengwo co-founder Lü Gang revealed in an interview that advertising accounted for 50% of Mafengwo's total profit. In other words, the free travel product that Chen Gang had favored did not allow Mafengwo to overtake the old OTA. In 2018, Mafengwo changed its strategy and entered the OTA market, but it was too late. By then, Ctrip's core supply chain position in air tickets and high-star hotels was unshakable.

According to data from the China Economic Industry Research Institute, in 2021, Ctrip ranked first in China's online travel market, accounting for 36.3%, followed by Meituan Travel, accounting for 20.6%, and Tongcheng, Qunar, and Fliggy ranked third, fourth, and fifth. Platforms including Mafengwo were classified as "others", with a combined market share of only 7.1%. Mafengwo was thus squeezed out of the table by the old OTA.

Mafengwo’s profit dilemma is also reflected in its financing. In 2019, Mafengwo received $250 million in financing led by Tencent. This financing took seven months. According to media reports, the reason was that "various US dollar funds were not particularly satisfied with Mafengwo’s monetization capabilities and kept dragging their feet, resulting in a relatively long due diligence process."

Although it finally got the money, Mafengwo laid off employees twice in a row in 2019 due to heavy commercial investment and poor input-output ratio.

Another example of a vertical community that is difficult to monetize is Xiachufang. Xiachufang started to try e-commerce in 2012, selling condiments. The approach was to cooperate with e-commerce platforms, and users clicked on the condiment shopping guide link and jumped to the e-commerce platform to buy. That attempt was not successful because 99% of users chose to buy offline, and Xiachufang could only make a few dozen yuan a day.

After that, Xiachufang launched "Youdiantian" to sell organic vegetables, which was taken offline a few months after its launch. In 2015, Xiachufang launched the "Market" channel, which sells ingredients, food, kitchenware, kitchen appliances, etc. In 2019, Xiachufang opened offline experience stores in high-end shopping malls such as Beijing International Trade Mall, Century Golden Resources, and Blue Harbor.

▲ In 2020, Xiachufang Select Store opened in B2 of China World Mall

Image source: Xiachufang official microblog

But the above two attempts were not successful. In 2020, Wang Xusheng revealed in an interview that advertising revenue accounted for 60% of the total revenue. At present, the "store" of Xiachufang has replaced the "market" and continues to sell all kinds of fresh and semi-finished ingredients. The sales volume within 7 days is mostly 200-300. At the same time, various paid courses have been launched, which members can watch for free. The annual card price for new members is 168 yuan.

But whether it is selling ingredients or memberships, in order to sell well, there must be enough active users. One detail is that just after the top creator of Xiachufang "Manshi Manyu" switched to Xiaohongshu, Xiachufang also started live streaming with goods on Douyin. The vertical community and the creators of the vertical community have the same goal.

▲Xiachufang’s Douyin homepage

Compared with Mafengwo and Xiachufang, Haohaozhu's road to commercialization is more bumpy. Haohaozhu initially used advertising as its main source of income. In 2018, it began to focus on e-commerce, inviting home furnishing brands to settle in and providing a channel from UGC content to one-click purchase. Haohaozhu's founder Feng Su once said in an interview with the media that "sales are quite good", but the average customer price is not high.

Soon Feng Su discovered that there was a serious phenomenon of lost orders. It was common for users to buy on Tmall after viewing the products on the platform because the prices on Tmall were cheaper. So in 2021, Haohaozhu transformed again, trying to be to C in the community and to B in the commercial level - "providing services to designers and brand customers, hoping to connect and link users (designers & consumers), brands, and content, so that the platform's ecology can begin to take shape."

To translate it, it means helping consumers find designers, helping designers find clients, and helping brands connect with consumers.

According to Feng Su's idea, this model leap is a very critical change for Haohaozhu.

Kevin, the initiator of PMTalk Product Manager Community, believes that vertical platforms still have content, users and commercial value in a certain field, and the role of such platforms in the future will be more reflected in the service capabilities of B-side enterprises rather than C-side. Therefore, vertical platforms will use C-side content as the basic carrier to provide services to B-side. This coincides with the commercial transformation path of Haohaozhu.

Unfortunately, Haohaozhu has little time to verify the correctness of this route. Since September last year, some users who claim to be former employees of Haohaozhu have reported on Xiaohongshu that the company is experiencing operational difficulties. Before that, Feng Su and his partners had already entered Xiaohongshu to advertise for Haohaozhu. It is hard not to sigh that this is the traffic advantage of the leading platforms.

Of course, Xiaohongshu, which siphons traffic from vertical communities, has also stumbled along the way in commercialization. According to media reports, it was not until 2023 that Xiaohongshu turned a profit for the first time. This year, Xiaohongshu once again focused on e-commerce and started live streaming to sell goods, thereby exploring new commercial models.

▲ Zhang Xiaohui live-streams selling goods on Xiaohongshu

For a long time, including Xiaohongshu, content communities have relied on advertising for monetization, but they have always wanted to get rid of their absolute dependence on advertising because advertising naturally disrupts the community atmosphere. If the platform is too restrained in the advertising loading rate, it will be difficult to make money; but if the advertising loading rate is too high, it will inevitably destroy the community atmosphere.

The trend of communities moving towards transactions is an inevitable result of commercialization, but Mafengwo, Xiachufang and Haohaozhu are too small to compete with the times. In contrast, although Xiaohongshu faces competition from giants such as Taobao and Douyin in the e-commerce field, it wins in terms of its unique community atmosphere and the differentiated categories selected on this basis, such as non-standard products, designer brands, and niche originals, which can still contribute to Xiaohongshu's commercial ambitions.

However, how big the Xiaohongshu e-commerce platform can be and how high the ceiling is ultimately depends on whether the internal strategy of the organization is clear and whether the team efficiency and combat effectiveness are online. After all, this is a notoriously slow company.

04 Forgotten

"We don't pay attention to vertical communities anymore," an investor told Lieyun.com in 2020, saying that he and his investment institution had not paid attention to vertical communities for a long time. Another founder of a vertical community asked in return, "Does anyone still care about vertical communities now?"

The reactions of the capital market and practitioners can more or less reflect that vertical communities are irreversibly heading towards the sunset. Behind every forgotten name, there is the nostalgia and regret of a group of deep users.

▲ A note about missing "Haohaozhu" received a lot of attention and resonance on Xiaohongshu

Let’s review the golden age of vertical communities: In 2011, Guokr.com received $3 million in Series A funding, and by 2014, when it received its Series C funding, the amount had soared to $20 million; in 2014, Dongqiudi received $3 million in Series A funding, and just one year later, it received a $10 million Series B funding…

In 2017, when talking about the content industry, Chen Gang said, "Many companies have not established a virtuous cycle of content and transactions. The transaction link is particularly weak. In the process of commercialization, they ignore the prediction of industry development and fail to upgrade and transform the entire company at the right time. When the track is extended and the competition time becomes longer, some companies will fall behind before the dawn, or even Game Over."

That year, Mafengwo's annual GMV exceeded 10 billion for the first time, and it completed a $133 million Series D financing at the end of the year. Chen Gang made the most accurate prediction for vertical communities in the midst of prosperity, just like Abei in 2011.

Text｜Huo Sijiu Editor｜Sun Jing