Does Douyin still lack "Xiao Yang Ge"?
Xiao Yang Ge is back, but Douyin did not say "welcome".
On the evening of October 16, Douyin opened the door for Xiao Yang Ge, who had been off air for two years, with a short announcement of a few lines: in accordance with the rectification notice from Hefei Municipal Administration for Market Regulation, it agreed that Three Sheep would cancel its original account, register a new account, publish content and resume operations.
The "Crazy Xiao Yang Ge" account that once had hundreds of millions of fans has been cancelled, and Xiao Yang Ge has activated the new account "Qing Yang". At around 18:55 that night, Xiao Yang Ge and his elder brother appeared in the live stream room of "Xiao Yang Select", and their responses were basically consistent with the statement, and the live stream ended a few minutes later.
Xiao Yang Ge said that in the future, he will focus more on content creation and self-operated brand operation. Three Sheep announced that the company's official account "Three Sheep Network" will be renamed "Xiao Yang Select", and it will gradually transform from an MCN company to an e-commerce company. Fans of personal accounts need to be accumulated again, and the company will continue to operate.
The timing is also very "coincidental". The day before, Douyin Mall's Double 11 campaign just kicked off, and consumption coupons were distributed across multiple entrances including Doubao, Hongguo Short Drama, and Toutiao.
There is no evidence showing that this is a recall arranged for the big promotion, but Douyin E-commerce is currently looking for traffic everywhere, which is completely different from the situation two years ago when several top live streamers could support the entire market. During the two years when Xiao Yang Ge was absent, Douyin has developed merchant self-broadcasting, shelf e-commerce, and a large number of small and medium-sized influencers, and it no longer has to wait for a certain person to go live to do business.
After expanding in scale, the problem Douyin needs to solve has changed: it needs to draw shopping traffic from more Apps and use subsidies in exchange for order settlement. The attention of top influencers is still useful, but what Douyin lacks now is shopping traffic, while what Xiao Yang Ge can currently provide is mainly topics.
Fewer top influencers, slower growth
The growth rate of Douyin E-commerce can no longer be imagined based on the inertia of its early rapid expansion.
According to multiple media reports, in the first half of 2026, the paid GMV of Douyin E-commerce was about 2.4 trillion yuan, compared with about 2.1 trillion yuan in the same period last year. Calculated based on the approximate numbers in the reports, the year-on-year growth is about 14%. Among them, the paid GMV in the second quarter was about 1.24 trillion yuan, and the growth rate dropped to the low double digits.
Category data also points to the same fact. According to third-party statistics released by Cosmetics Observer, Douyin's beauty and skincare GMV in the first three quarters of this year was about 218 billion yuan, a year-on-year increase of 11.63%, lower than the growth rate of over 20% reported last year.
In the largest categories of beauty skincare, body care and essential oils, Douyin recorded a 3.42% year-on-year growth, while Tmall recorded a 5.59% year-on-year growth. Douyin leads in the overall size of the beauty sector, but the growth rate of the skincare category lags behind Tmall. The transaction advantage of Douyin E-commerce has not been fully reflected in every category.
This year's Double 11, Douyin's moves are no longer limited to holding more large live streams. Instead, it distributes consumption coupons to entrances including Doubao, Hongguo and Toutiao, so that users who are originally asking questions, watching short dramas or reading news can easily enter the shopping process.
Cross-platform coupon distribution increases the chances of triggering shopping. Even if users already use Douyin, they may not have shopped on it before, and new entrances still have the opportunity to bring new buyers.
Compared with continuing to expand live broadcast supply, this is more in line with the current dilemma of Douyin. According to the author summit announced in September, the total number of Douyin E-commerce creators has exceeded 12 million, and more than 4.56 million new creators with sales performance have been added in the past year. More and more people can sell goods, but consumers' wallets do not necessarily expand accordingly. For Douyin, after expanding the number of live streamers, it also needs to ensure that these operators can get enough orders.
The value of Xiao Yang Ge's return needs to be measured against this background. He provides a ready-made public topic that can make some users refocus on Douyin's live e-commerce. But popularity does not equal business. On August 2, the new live stream "Beautiful Tomorrow" launched by Sun Dongxu, former CEO of Eastbuy, and two other live streamers, ranked first in Douyin's total live streaming sales list within half an hour, and its popularity once surpassed that of Yu Hui Tong Hang, but third-party estimates show that its sales volume in five hours was only between 5 million yuan and 10 million yuan.
More fundamentally, the position of top influencers in Douyin's overall market has long changed. Xinhuanet cited the "2025 Live E-commerce Industry Development White Paper" as saying that in 2024, the transaction volume contributed by head influencers with more than one million fans accounted for about 9% of Douyin E-commerce's total market. The transaction sources of Douyin have been quite scattered. Top influencers can still gather public attention, but it is difficult for them to drive the overall market growth on their own.
What Three Sheep really built back then was a self-operating machine: it used Xiao Yang Ge as an IP to attract traffic, deployed thousands of influencers and clip editors, and realized monetization through live broadcasts and short videos. The machine can run, but it belongs to Three Sheep, not Douyin's infrastructure.
What Douyin has built in the past two years is another set of infrastructure: users can directly find products through product cards and search, and brands can operate continuously through store live broadcasts, without having to pin all transactions on a certain live stream of an influencer.
Therefore, Xiao Yang Ge's return has been re-priced. He is still a scarce attention resource, but to support the trillion-yuan scale growth, Douyin needs to turn more usage scenarios into consumption scenarios. A top influencer can bring back attention, but cannot bring back the original growth slope.
Funds for Double 11 are starting to chase effective orders
Subsidies are still being invested, but Douyin has begun to calculate where to invest and what returns it can get.
This year, like other platforms, Douyin's Double 11 has weakened pre-sales and focused on spot goods. Product discounts are divided into two types: "instant reduction discount" and "direct price cut for one item". The discounts are borne by merchants, and the additional platform consumption coupons are funded by Douyin, which gives priority to supporting best-selling products, official flagship stores and products with sufficient spot inventory.
Merchants first provide competitive products and prices, and then Douyin uses consumption coupons and traffic to amplify transaction opportunities, concentrating resources on products that can be sold and delivered smoothly.
If we extend the timeline beyond the big promotion, the intention becomes clearer. According to media reports, Douyin E-commerce has set settled GMV as a key assessment target in 2026, squeezing out the moisture caused by returns and refunds. Transactions driven by low-price volume rush and large-scale live broadcasts will be discounted under this caliber, and volume rush is exactly what head live broadcast rooms are best at.
According to the policy information for small, medium and new merchants announced on October 12, the live stream traffic incentive for some live rooms is based on the "incremental settled GMV" compared with the reference period. Merchants that meet the requirements of actual GMV, settlement rate and other indicators can get a maximum of 300,000 yuan in traffic incentives; activities for new self-broadcasting merchants also set minimum payment order volume and settlement rate thresholds.
In the past, a promotion would push the payment amount to a very high level, followed by a large number of order cancellations and returns. For merchants, the costs of traffic investment, customer service and fulfillment have already been spent. For Douyin, it is also difficult to persuade merchants to continue investing in the next round.
Behind the inclusion of increment and settlement into the incentive system, Douyin wants to reduce two types of waste: one is subsidies for orders that already exist, and the other is subsidies for orders that cannot be retained in the end.
The same logic has also been applied to head influencers. This year's Double 11, head influencers still have exclusive gameplay called "Super Value Group", but the rule is to distribute traffic in real time according to the settled GMV, followed by Qianchuan's post-return: the money is paid by the influencers themselves first, and the platform settles accounts according to the results. The position of head influencers on Douyin has changed from the facade supported by traffic to the largest group of advertisers. The data on the first day of Double 11 also revealed the focus: the number of merchants whose store live broadcast transactions exceeded 10 million yuan increased by 96% year-on-year.
Therefore, the expansion of store live broadcasts and small and medium-sized influencers is not just to get rid of dependence on top influencers. With sufficient supply, Douyin can select and give support to operators who can better meet user demands.
However, as the number of operators increases, competition will also intensify. Merchants save a sum of influencer commission, which may be spent on live broadcast teams and traffic investment. If Douyin wants to increase its advertising revenue, it must allow merchants to have enough money to continue investing. After the growth rate slows down, who provides subsidies, who makes profits, and how much money is eaten up by refunds directly determine whether merchants will stay on the platform.
These detailed rules of this year's Double 11 are answering on one side how Douyin plans to continue growing: create more shopping opportunities through more entrances, and then use settlement thresholds to screen out orders worthy of continued investment.
Top influencers create popularity, Douyin must retain purchasing habits
Douyin has not given up on influencers. The "Selection Plan" launched in September still provides traffic, merchant cooperation and operation services for high-quality creators, and qualified creators can get back up to 100% of the technical service fee. The assessment criteria include content trust, consumer decision-making value and business performance.
But these changes have not eliminated the scarcity of top influencers. What is scarce is the person, not the account. In September 2025, Wei Ge, Qiao Mei and Lao K under Three Sheep resumed live streaming on Douyin first, without the appearance of the two Xiao Yang brothers. The number of online viewers in Wei Ge's live stream once exceeded 100,000. In contrast, the number of online viewers on the night of Xiao Yang Ge's comeback was less than 2,000. The machine is still running, and it can still sell goods without that person. The marginal value of Xiao Yang Ge as an individual has been re-priced during the two years of off-air.
Top influencers are responsible for gathering public attention, while store live broadcasts, short videos and shelf e-commerce allow products to continue selling after the popularity fades. During the 618 shopping festival in 2026, small and medium-sized influencers with less than one million fans contributed more than 80% of the total sales generated by influencer live streaming, and the number of merchants whose transaction volume driven by search exceeded 10 million yuan increased by 53% year-on-year. Douyin has accumulated a sufficient scale of daily transaction supply. The remaining question is, when there is no hot topic, no big live streamer, and no large consumption coupon, are users still willing to take the initiative to come to Douyin to shop?
This is the key for Douyin to compete with mature shelf e-commerce platforms. Double 11 can use discounts to stimulate one-time orders, but to turn purchasing into a habit, it depends on stable products, prices, delivery and after-sales services.
Three Sheep's proposal to transform into an e-commerce company and operate self-owned brands is also an attempt to accumulate operational capabilities beyond personal traffic. In the first half of Eastbuy's 2026 fiscal year, that is, from June to November 2025, the GMV of self-operated products accounted for 52.8%. Jiao Ge Peng You stated in 2024 that the revenue proportion of Luo Yonghao's two main accounts had dropped to less than 3%, and the company's revenue was mainly contributed by vertical matrix accounts. The former expands self-operated products, and the latter disperses revenue sources across accounts, both of which are reducing the business's dependence on a single live streamer.
The cost also needs to be controlled. The price Three Sheep paid for illegal operations includes a fine and confiscation of 68.9495 million yuan, plus compensation for the involved products, totaling 96.728 million yuan in total. The attention brought by a controversial live streamer may turn into traffic, or it may turn into consumers' doubts about products and the platform, and the trust cost will ultimately be borne by the platform.
This year's Double 11, Douyin distributed coupons in entrances such as Doubao and Hongguo, and Xiao Yang Ge's return also brought a wave of discussions. After the bustle, will these people think of Douyin the next time they want to buy something?
Note: The data in this article comes from public sources.