"MoguStreet", which didn't become the "Little Red Book", chooses to start a new business on Little Red Book | An interview by 36Kr.

Author｜Li Xiaoxia

When it comes to Mogujie, what comes to your mind? In the current e-commerce landscape, this might be a somewhat unfamiliar name.

In 2011, Chen Qi, who had worked at Taobao for six years, followed Ma Yun's example by selling his property in Hangzhou. Together with his friends from Zhejiang University, he founded Mogujie, mainly engaged in the e-commerce shopping guide business. Three years later, due to its overly rapid growth, its external links were blocked by Taobao, and thus it began its transformation journey, attempting various business models such as cross-border e-commerce, brand sales, social e-commerce, and live-streaming e-commerce.

On this journey, Pinduoduo, Xiaohongshu, and Douyin E-commerce emerged. From the results, it seems that Mogujie, which was one of the earliest to get involved, has been laying the groundwork for others. 36Kr once raised this question to Chen Qi, and he said: "We are always six months ahead of others in innovation, but the innovation in that scenario is difficult to form a barrier. However, because of continuous innovation, we can survive until now. Companies of the same period have almost disappeared. If you don't innovate, you may not be able to survive."

Chen Qi once had a hard time accepting the situation of Mogujie, but in recent years, he no longer dwells on this and has shifted his focus to artificial intelligence and investment. Under his leadership, Mogujie incubated the AI commercial photography tool WeShop, and invested in the AI full-link marketing company Aotron Guangnian and the cell-based meat company Jimi Biology. In March 2023, he stepped down as CEO and handed over the position to Fan Yiming, the general manager of Mogujie's business.

This year, Mogujie began to explore new businesses beyond its own platform, one of which is to be an MCN for fashion influencers on Xiaohongshu. How can Mogujie, which could have been Xiaohongshu, explore opportunities on Xiaohongshu? Recently, 36Kr had a chat with Fan Yiming, the CEO of Mogujie. The following is an excerpt of the conversation (edited):

Doing Xiaohongshu is leveraging Mogujie's strong capabilities

36Kr: Why choose to do Xiaohongshu?

Fan Yiming: Actually, in the second half of last year, when we were discussing this year's strategy, we were ready to explore new businesses beyond the Mogujie platform. At that time, two major directions were determined: one is the business related to people, and the other is the brand business. When we made the decision, many platforms came into our view, including Douyin, Kuaishou, Xiaohongshu, and Video Account. I set a direction that we couldn't do everything. Mogujie is good at content + e-commerce. Choosing a platform with a content gene would be more suitable for us. So finally, we decided on Xiaohongshu and Douyin. We will be an MCN for fashion influencers on Xiaohongshu and an agency for fashion brands on Douyin.

36Kr: What are your advantages in doing Xiaohongshu?

Fan Yiming: To be honest, in recent years, Mogujie has been facing competition from giant platforms, and it is impossible to compare in scale. Therefore, we have always required ourselves to be a service-oriented platform. The entire operation team should have a platform thinking and an institutional service ability. To put it simply, we should make the anchors and merchants on the Mogujie platform the most convenient and worry-free.

Nowadays, few platform operations are as meticulous as ours in live-streaming e-commerce. We are doing almost everything from merchant recruitment, product selection, scheduling to assistant hosting. Our two VPs are also rolling up their sleeves to do very front-line work: negotiating with anchors, following the scenes, product selection, and merchant performance, from beginning to end. If we don't do this, it definitely won't work. Because of the previous accumulation, our team is very comfortable doing Xiaohongshu, and it is growing very fast. In October, we won the first place among Xiaohongshu service agencies.

36Kr: What kind of achievements can win the first place?

Fan Yiming: In October, we incubated 9 anchors who reached 500,000 for the first time in a single month. Currently, Xiaohongshu is pursuing that more influencers can become anchors with considerable sales, and hopes that agencies can incubate more influencers who have never done live-streaming, rather than just pursuing one or two anchors who can achieve hundreds of millions in sales. We achieved 9 in October, which is not difficult for us, but it may not be easy for others. Because cooperating with fashion bloggers is actually not the same as the ordinary sales promotion and marketing routines. The first Xiaohongshu anchor we signed, when she was broadcasting by herself, her sales were 100,000 or 200,000. After signing with us, basically every session is doubled. In the seventh session, her sales exceeded 1 million, and now a single session has exceeded more than 2 million.

36Kr: How many are you planning to sign this year?

Fan Yiming: We will sign influencers in two situations. This year, about 10 to 20 are key incubations. Each person will have an independent personal setting plan, a dedicated live-streaming room, a dedicated operation team, a mid-field controller, and there will also be hundreds of lightly incubated anchors. We will do more supply chain product selection and content script output, which is relatively lighter. Because many good Xiaohongshu bloggers are not in Hangzhou, heavy off-site cooperation is not very convenient. In this case, we adopt a light incubation model, and the efficiency is also quite good.

36Kr: Do you have any methodologies that can be shared for doing Xiaohongshu?

Fan Yiming: First, in screening influencers, they need to have a certain number of fans. As long as they have more than 20,000 fans, they are basically within our scope. Then, based on the attributes and tags of the account, as well as the interaction and likes, we can determine whether the influencer is vertical enough, has a certain volume base, and whether the interaction with fans is healthy.

Next is to look at the anchor's sensitivity and willingness to do live-streaming. For the simplest example, if an influencer has only posted pictures and not videos, it can't be said that she definitely can't do live-streaming. But in the case that Xiaohongshu has been promoting short videos for so many years and she hasn't done short videos, it proves that she doesn't have strong confidence in the performance on the dynamic camera.

The second is content ability. The Xiaohongshu influencers we sign usually fall into two categories. One is the lifestyle blogger, whose past content is more inclined to the lifestyle, similar to the form of Vlog. We will gradually adjust the content to the direction of vertical seeding, and gradually adjust the ratio of lifestyle content and seeding content to about 7 to 3. The other is a professional influencer who only posts seeding content, which may lead to a relatively weak affinity and fan stickiness. In this case, we will add creative lifestyle content to her to make fans gradually feel her life status, so that fans not only recognize her professionalism but also like this person. We have verified that these are very effective.

The third is product selection and matching. Basically, we sign anchors mainly for clothing sales. Clothing itself is the largest category in e-commerce, and I think among so many platforms, the most competitive product on Xiaohongshu is the designer fashion women's clothing, and Mogujie has also accumulated many years of supply chain resources for fashion women's clothing.. So from the perspective of product selection, the first step is to find the most advantageous products on Xiaohongshu, and then to superimpose our daily accumulated product selection and matching capabilities in the live-streaming operation.

Of course, there are also some live-streaming marketing methods to add some flavor to the plain live-streaming.

You won't be anxious if you keep working hard

36Kr: Doing Xiaohongshu means leveraging what you are good at. What about the commercial considerations?

Fan Yiming: In the past ten years, the growth of the pure Internet model has actually not emphasized profits but scale. In the end, only by achieving near-monopoly can there be profits. Mogujie's financing amount and user scale cannot compete with giants like Taobao and Pinduoduo. Therefore, when we do new businesses, we return to the basics and the logic of business. Today, when we just enter a new platform, it is not realistic to expect a large scale immediately. Therefore, I hope that in the initial stage, we can choose the most suitable track to invest in. After the platform stabilizes its own positioning, it is enough to have a stable profit.

Then, as the platform develops, the scale can be gradually expanded. Our KPI for this year is to become a top MCN on Xiaohongshu, and we have not placed too high a requirement on the team to make a lot of money now. But I believe that by July next year, Mogujie should be among the top institutions on Xiaohongshu. As long as we stand firm in this position, you can rest assured to grow along with the development of the platform.

It seems that (entering the top 10) should not be a big problem now, but it is actually quite difficult to estimate how large a scale we will achieve, because there is no base at present. How can we set the team goals? If you set it too low, the team will think it is too easy to achieve; if you set it too high, the team does not have such a clear numerical concept. Of course, the main website of Mogujie will still set clear quarterly and annual goals, but for new businesses, we take it on a monthly basis. For example, how many anchors to sign in the first month, how large the sales scale is, and the need to have a benchmark that can reach a certain level in a single session, so that it is also convenient for us to attract more new anchors.

36Kr: From what you just said, it seems to be a relatively smooth process. Are there no challenges in the middle?

Fan Yiming: I think in terms of scale, the challenge is to what extent Xiaohongshu will open up the live-streaming business.

Xiaohongshu currently has 120 million DAU and is already a platform with a strong barrier. How large the e-commerce business of Xiaohongshu can be depends entirely on the extent to which the platform opens up the e-commerce business and is willing to open up how much natural traffic to live-streaming. For a social media with 120 million DAU with a shopping mentality, I think a scale of several hundred billion is definitely no problem.

So why we are so concerned about reservations now is that the private domain traffic of purchasing users on Xiaohongshu currently accounts for a relatively high proportion, and there are not so many customers who come in from the public domain to make purchases. Therefore, influencers must be very serious in doing note content to warm up for the live-streaming, and the frequency of live-streaming cannot be too high. From an operational perspective, this is a stable operation method, and it is impossible to achieve explosive growth in a short period of time. But I can very well understand Xiaohongshu's perspective on content and e-commerce. After all, we have also gone through this.

36Kr: Are there any things that make you anxious now?

Fan Yiming: First of all, we must objectively view the current general environment and the reality that the golden decade of the Internet has passed. But we cannot give up working hard and must work hard on what we are good at. As long as we do what we are good at, even if there is no so-called explosive and large-scale growth in the short term, as long as I think this thing is right and the team also supports me, I don't think I will be anxious.

Under what circumstances will you be anxious? It is when you see that the general environment is not good, but you can't find something you认可度 to do. If today we use a short-termism and opportunism mindset to do new businesses, even if we see results in the short term, because this thing is not what you love and are good at, it is not necessarily a good result in the long term, and I think you will be anxious sooner or later.

Today, Mogujie is indeed facing a lot of competitive pressure. It is very difficult to compete with platforms like Taobao and Douyin, and anchors also have the problem of life cycle. My sense of security now comes from the fact that we are working hard in a new and right direction. In today's general environment, as long as you work hard in the right direction, you don't have to be anxious.

Still need to do fashion-related things

36Kr: What kind of relationship do you have with Xiaohongshu now?

Fan Yiming: Our colleagues often visit them in Shanghai, and they also come to us from time to time to exchange some experience and insights on doing live-streaming. Because the e-commerce business that Xiaohongshu is currently doing is also the path we have taken before, and at the same time, they think that Mogujie has successful experience in doing live-streaming for fashion influencers, so they especially hope that we can incubate live-streaming influencers for Xiaohongshu.

Mogujie is a very special institution on Xiaohongshu. Because we are relatively good at both fashion content and fashion e-commerce, I feel that the teams of both sides need each other and are also very trusting of each other.

36Kr: Does doing Xiaohongshu have any connection with some of the main website's businesses?

Fan Yiming: Mogujie has a large supply of fashion women's clothing, which is provided for the anchors on Mogujie to select products for live-streaming. But our supply chain capacity is actually overflowing. So initially, we thought that we should bring our own supply chain capacity to other platforms and also serve the anchors on other platforms.

For the goods we cooperate with Xiaohongshu bloggers, some are introduced to Xiaohongshu by the cooperative merchants of Mogujie, and some are selected from the product selection pool of Xiaohongshu. The content creator ecosystem of Xiaohongshu has always been very rich, but the merchant ecosystem is relatively small. You may find that the products of some anchors are a bit similar. Therefore, the supply chain of fashion women's clothing is Mogujie's advantage.

36Kr: Mogujie was once regarded as the one with the most hope to become Xiaohongshu, but it seems to have been a bit quiet in recent years. Do you have any new actions?

Fan Yiming: In the current general environment, it is difficult for the user scale of all platforms to grow, and our users will also be taken away by giant platforms, but it is difficult for us to take away the users of giant platforms. Therefore, our users have a ceiling. If the users cannot grow, we will expand the categories. So in the past three or four years, we have started to expand categories. Even during the epidemic, we desperately helped the anchors to find some categories related to food, beverages, and big health. Previously, you could not see categories other than clothing on Mogujie, but in recent years, the growth of standard product categories on Mogujie has been very fast. At the same time, our customer unit price and conversion rate have also been improving.

So in a company, within the strategy we think is feasible, as long as everyone works hard to implement it properly, it is OK.

Although it sounds a bit like a defensive strategy, under the strategic requirements, I think the cohesion and execution ability of the entire team have been good in recent years. I also hear external doubts that why Mogujie doesn't advertise much and has less publicity in recent years. Because in this general environment, the return on investment for acquiring new customers is getting lower and lower, and the more we spend, the more it will affect the company's operation. So we are more focused on improving our internal strength, making the service for anchors and merchants better, and improving the combat ability of the team. In this way, when entering a new business, the team is already ready.

The new actions include the MCN for Xiaohongshu fashion anchors and the operation of Douyin fashion brands that we have been talking about, as well as the AI model business Weshop that we launched last year. Currently, this business already has nearly 1 million B-end customers globally.

36Kr: When you try the new MCN business, is it to prove that you are not lying down, or do you have some ambitions?

Fan Yiming: When we went public in 2018, we had a mission called make fashion accessible to everyone, hoping to make every girl enjoy accessible fashion through content + e-commerce, and it is clear that technology is our ability and fashion is our track. In the past period of time, some colleagues who are very passionate about fashion have complained that in the e-commerce industry, everyone has been competing, and in the end, everyone is pursuing digital efficiency. The things about fashion are getting less and less attention from the platform and anchors.

So this year when we were thinking about these new businesses, it is not only to prove that we are not lying down, but more importantly, to persist in our mission. After a quarter of business exploration. In the middle of this year, I clearly told everyone that whether it is incubating anchors or brands, we are more擅长 at doing fashion-related things. Therefore