TikTok refugees flocking to Red Note: what it signifies for China's global "soft power" and economy

Will it last?

Earlier this week, over half a million TikTok users flocked to another Chinese social media platform Xiaohongshu because of the imminent TikTok ban. They call themselves "TikTok refugees". And many Chinese users, including myself, woke up this Monday to discover that the App was suddenly flooded with many greetings from America. At first, many thought they had opened the wrong app.

Since China banned access to Facebook, Twitter, and YouTube back in 2009, many have wished to see China talking to the world on the same side of the firewall. But few of us could have imagined this happening within China's side of the wall.

Some Chinese netizens remarked that this gave them a nostalgic sense of the "global village" feeling from the 2000s. It's a somewhat bittersweet reminder in today's world, where "reverse globalization" and "decoupling" increasingly dominate geopolitical narratives.

What happened since Monday & what is Xiaohongshu

With the U.S. Supreme Court poised to uphold a law that could ban TikTok unless its Chinese parent company, ByteDance, divests ownership by January 19, 2025, many American users are seeking alternatives. Interestingly, a significant number have turned to Xiaohongshu, a Chinese social media app known as "Little Red Book" or "Red Note" in the U.S.

This platform has even become the most downloaded free social network app in the U.S. App Store in just a couple days.

Red Note was founded in 2013 by Miranda Qu and Charlwin Mao. It is a lifestyle-focused social media platform that blends user-generated content with e-commerce. It is mostly similar to Instagram and Pinterest but has also introduced TikTok-style reel-scrolling interactions in recent years as short videos gain traction in China.

The app now boasts over 300 million monthly active users, with 70% being young urban females. Its user base is similar to TikTok's, with 50% born after 1995 and 35% after 2000. Over 50% of the users reside in economically developed regions in China, such as first-tier metropolitan areas and municipal capital cities [source]. This demographic gives Red Note unique opportunities to combine social media and e-commerce, primarily catering to female-oriented goods and services like cosmetics, fashion, travel, and other lifestyle content.

Red Note has attracted major investors like Temasek and other Chinese internet giants including Alibaba and Tencent. As of late 2024, Xiaohongshu achieved profitability, with net income expected to surpass 1 billion USD—more than double its 2023 figures—positioning it for a potential IPO in Hong Kong.

Some of the best TikTok refugee contents on Red Note I've seen so far

Users from the U.S. and China are sharing memes and pet photos, with Americans humorously referring to "paying pet taxes" as they integrate into the predominantly Chinese-speaking community.

Americans and Chinese have enthusiastically exchanged their best memes as a way of saying hello.

In a volatile world where the U.S. and China appear to be moving in conflicting directions, memes and cute pets seem to have become the unquestionable common ground both countries can agree on.

Another funny thing is that many Chinese students are asking Americans for help with their English homework; and Americans turning to Chinese for math. Let's be real—this is a prime example of building a mutually beneficial U.S.-China relationship through spontaneous grassroots efforts.

What truly exceeded my expectations is that these interactions haven't been limited to casual exchanges of funny memes and pet pictures. I've come across a lot of dialogues diving into deeper topics. For instance, Americans and Chinese are comparing notes on things like cost of living, healthcare system, work conditions, thoughts on history, capitalism, and even Luigi Mangione. Some Americans are requesting to see real pictures of Chinese streets. Many expressed surprise at the disparity between their previous perceptions and the reality they're discovering.

Partly because Red Note has a large user base fluent in English, with many users having international experience, communication is going very smoothly. Many Americans are discovering that the Chinese community is actually quite funny, even though some may appear a bit shy or introverted in real life and on Western media.

Why I think the hype won't last for long

Right now, many TikTok refugees have flocked to Red Note, primarily as a form of protest against the U.S. banning TikTok. This may be why they specifically chose another Chinese app over Instagram or YouTube Shorts.

Some creators are essentially saying, "If the Chinese want my data, here's all my data," using sarcasm to point out that U.S. internet companies also have multiple data breach cases, making the so-called "data security" accusation seem hypocritical.

A Red Note content created by a TikTok refugee

But fundamentally, for creators to thrive on a platform and build a sustainable community, they need to be able to monetize their content. This is exactly why TikTok has won over half of the U.S. population. Many creators chose to work with TikTok for good reasons, and many rely on it as a secondary or even primary source of income.

During the Supreme Court hearing last Friday, Mr. Fisher, the attorney representing TikTok creators, highlighted this economic aspect. He argued that TikTok's algorithm enables ordinary creators to amplify their voices—a feature not easily replicated on other platforms. It's not as simple as asking TikTok creators to post the same content elsewhere. There's a difference between having the freedom to say what you want and having your voice truly heard, with enough weight behind what you say to make an impact.

Mr Fisher: TikTok has a distinct editorial and publicational perspective, and it particularly benefits people like my clients, who are not famous people. They're not actors from Hollywood who have a lot of people following them. They're ordinary American citizens whose content that they create on the platform gets privileged by way of the quality of that content.

However, it's unlikely that TikTok refugees will be able to replicate the same dynamics on Red Note. On Xiaohongshu, the primary monetization method is selling goods and services, which isn't viable for foreigners who don't speak the language or live in China. They will face challenges scaling their business to the local Chinese-speaking community or transacting within the English-speaking community using RMB.

Plus, the Chinese government will soon have to regulate this in some way.

Implications for US-China relationship and Chinese companies going abroad

Although it's almost certain that China will need to regulate what's happening with Red Note, this situation also opens a significant opportunity for China to export its "soft power" and create genuine economic wealth—especially during this pivotal moment in history.

First, the failure of TikTok's lawsuit is, ironically, a testament to the success of China's so-called "soft power."

If the U.S. chooses, TikTok's case could indeed set a precedent for targeting other Chinese companies in the future. TikTok isn't the only app owned by ByteDance, and many other companies—especially in the internet and e-commerce sectors—also hold millions of consumers' data, making them vulnerable to similar accusations.

But beyond the challenges, plenty of Chinese companies have already carved out global success stories. From well-known platforms like Temu to the fact that a quarter of the companies participating in CES were Chinese, to brands like Vivaia (which we covered in a previous post), whose seamless localization has left many unaware it's even a Chinese brand.

Major players like Tencent, Alibaba, Pinduoduo, and ByteDance have all strategically gone global, "manufacturing" apps and games that dominate niches. These successes often fly under the radar because, unlike physical goods, they don't carry the "Made in China" label.

TikTok's ban highlights just how influential Chinese companies have become—it's a direct indicator of their ability to move up the value chain. While AI chips symbolize innovation, platforms like TikTok and Temu also generate real economic value, despite appearing to involve lower levels of technological advancement.

This could whet investors' appetites for other promising developments especially from China's tech giants.

Second, this presents an opportunity for China to reinforce the "openness" message it's been trying to convey to the world.

While it's mostly certain that the Chinese government will regulate the influx of "TikTok refugees," the approach it takes will be critical. Some netizens have even suggested creating a "Red Note SAR" (Special Administrative Region) as a way to experiment with opening up global dialogue — an idea that's both interesting and legit.

In recent years, China has made significant efforts to signal its openness, from visa-free policies to easing restrictions for foreign individuals and companies to invest and conduct businesses. But none of these initiatives would be as impactful as a successful "Red Note SAR." Such a move could demonstrate that China is genuinely open and eager to integrate into the global community.

If handled well, this regulation could bring tangible benefits to China's domestic businesses, such as boosting inbound tourism and attracting much-needed foreign investment, especially at a time when FDI into China is hitting record lows.

Lastly, informal communication at the grassroots level can benefit Chinese companies going global. Winning over consumers is just as important—and challenging—as building good relationships with governments.

Consumers don't just buy products; they buy into stories and values. While affordability matters, branding Chinese goods as merely "cheap" will trap the country in a cycle of "involution". To truly resonate with global consumers, China needs to showcase the passion, creativity, and individuality behind its products and move away from the stereotype of being a "996 factory" in a "one-party state"—an image that has increasingly become a key factor in why consumers resist Chinese brands.

A platform like Red Note can provide an organic channel to highlight the "cool" side of "Made in China."

This is a rare and valuable chance for China to directly connect with global consumers and showcase its culture authentically—an opportunity made even more precious by today's U.S.-China narrative, which often focuses on decoupling, portrays China as an adversary, and reduces Chinese products to the stereotype of being merely cheap copycats.

Could this be the fall of the "cyber Berlin Wall"?

I'm not sure. But I truly hope it is.

Nevertheless it's great that we got to witness history in the making! These days, Red Note has been the most exciting social media experience I've had since returning to China from the U.S. in 2021. Please do join me and enjoy the vibrant dialogue happening on Red Note right now—it's something you won't want to miss!

A Red Note post: "The mental state of Chinese and American people on Red Note these days."

Related Reads

Where do investment opportunities lie in China's after-school tutoring sector in the new era?

Why are China's venture capital funds acquiring publicly listed companies?

DeepSeek: The low-profile Chinese AI startup shaking up the LLM price war