Xiaohongshu, a Chinese social media platform valued at $17 billion, is emerging as a significant e-commerce player by combining lifestyle content with a distinctive approach to livestream selling that appeals to affluent urban consumers.

The platform, which translates to “little red book” and counts over 300 million users, has struggled with previous e-commerce initiatives over the past decade. However, brands reported a breakthrough in sales this year, particularly in the high-end and niche product segments, according to a Reuters report citing consultants and brand representatives.

Tera Feng, an influencer with 500,000 followers, exemplifies the platform’s unique selling model. In three months of livestreaming, she has successfully marketed products ranging from a 15,000 yuan (~$2,060) Carven suit to premium rice costing 60 yuan per kilogram (~$8 per 2.2 lbs).

Unlike competitors such as Alibaba’s Taobao and PDD Holdings’ Pinduoduo, which rely heavily on discounting, Xiaohongshu’s focus on aspirational lifestyle content attracts less price-sensitive consumers. “Brands really value a following on Xiaohongshu because the consumption power is totally different,” Suya Wang, GM at Shanghai-based consultancy Early Data, said in a statement.

Major brands, including L’Oreal, Coach, and LVMH, are increasing their presence on the platform. Some operate their own stores, while others partner with influencers who showcase multiple brands and categories in their livestreams. The platform distinguishes itself through a more conversational approach to sales, contrasting with the aggressive tactics common on other platforms.

As per Reuters, Ian Hylton, President of designer brand Ms MIN, reports unexpected success through actress Dong Jie’s live streams, with hundreds of units sold after single broadcasts. The brand’s knitted sweaters sell for over 5,000 yuan (~$686).

WPIC Marketing + Technologies CEO Jacob Cooke projects triple-digit growth in Xiaohongshu’s gross merchandise volume next year, estimating sales revenue will exceed $100 billion by 2025. The company has been recruiting staff from competitors Alibaba and ByteDance’s Douyin.

However, tech analyst Li Chengdong notes that Xiaohongshu remains a niche player compared to China’s top three e-commerce platforms – Tmall, JD.com, and Pinduoduo – which control over 90% of the country’s $2.78 trillion gross merchandise volume.