In-Depth Analysis of Walmart and Xiaohongshu's Partnership: Strategic Implications of Social E-Commerce + Offline Retail Integration

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On January 16, 2026, Walmart and Xiaohongshu jointly announced a deep strategic partnership. The two parties will collaborate on

to explore a new customer-centric business model[1]. This partnership marks the deep integration of a traditional retail giant and an emerging social e-commerce platform, and is a milestone event.

• Innovative Retail Experience Space
  : The first innovative retail experience space co-created by the two parties, “Mashu Store”, opened in the newly renovated Walmart in Shekou, Shenzhen[1]
• Co-Branded Product Development
  : The first batch of co-branded products “Walmart Fresh × Xiaohongshu | Treasure New Products” has been officially launched[1]
• Channel Entry
  : Walmart has become the
  first omnichannel retail supermarket brand to enter Xiaohongshu’s e-commerce platform
  [1]

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Xiaohongshu, a leading Chinese lifestyle social platform, has achieved significant breakthroughs in the e-commerce field in recent years:

Metric	Data	Industry Position
Monthly Active Users	Over 350 million	Ranks among top social platforms
Share of Post-95s in Monthly Active E-Commerce Buyers	70%	Hub for young consumer groups
2024 GMV	400 billion RMB , up 45% YoY	Leader in the social e-commerce track
2025 Profit Forecast	3 billion USD (triple the previous figure)	Approximately 50% higher than Pinterest
Latest Valuation	31 billion USD	Profitability recognized by capital markets

[2][3]

In August 2025, Xiaohongshu upgraded its e-commerce function to a first-level entrance - “Market”, replacing the original “Popular” short video feed entrance, marking its determination to fully promote e-commerce business[4]. This “lifestyle e-commerce” model emphasizes:

• Content Seeding
  : Building a trust-based community through real user sharing
• Buyer E-Commerce
  : Integrating KOL/KOC resources for product recommendations
• Browse and Purchase Enabled
  : Maintaining community atmosphere while achieving a closed-loop shopping experience

Xiaohongshu currently has

seeking purchase recommendations in the community, and its e-commerce business has upgraded from “non-essential” to a core growth engine[4].

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Walmart has shown strong growth momentum in the Chinese market, with multiple quarterly data in FY2025 continuously exceeding expectations:

Metric	FY2025 Q4	YoY Change	Full-Year Performance
Net Sales in China Market	5.1 billion USD	+27.7%	Sustained accelerated growth
Same-Store Sales Growth	23.1%	Significant improvement	12.5%/13.8%/15% in Q1-Q3 respectively
E-Commerce Business Growth Rate	34%	Maintains high growth	Accounts for approximately 50% of total sales
Sam’s Club Membership Revenue	—	+35%	Strengthened willingness to pay for memberships

[5][6]

Sam’s Club has become the pillar business of Walmart China:

• Sales Scale
  : 2024 omnichannel sales exceeded
  100 billion RMB
  (approximately 14 billion USD), contributing about
  70% of Walmart China’s total revenue
  [7]
• Store Expansion
  : As of the end of January 2025, Sam’s Club has
  53 stores
  in China; the number of new stores opened in the past 4 years exceeds the total number opened before; it plans to open
  6-7 new stores annually
  in the next 3 years[5][8]
• Membership Scale
  : Membership count is approaching
  9 million
  , with core customer groups being middle-class families[8]
• Online Penetration
  : Online sales account for more than
  50%
  , with “Quick Delivery” and “City-Wide Delivery” supporting half of the business[9]

1. Product Strength
   : Own brand Member’s Mark accounts for approximately 30% of sales, with a “wide category, shallow SKU, high quality” strategy
2. Supply Chain
   : Cost advantages brought by global procurement scale effects
3. Omnichannel
   : Instant retail network consisting of over 350 distribution points

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Walmart and Xiaohongshu’s partnership represents a new paradigm of

in the retail industry:

Dimension	Traditional Model	New Integrated Model
Traffic Acquisition	Relies on store location and brand advertising	Drives traffic through content seeding on social platforms
Consumer Decision-Making	Active search + price comparison	KOC recommendations + community reputation
Purchase Scenario	Offline stores or traditional e-commerce	Closed-loop completion within social platforms
User Stickiness	Relies on membership systems and promotions	Community interaction + content consumption

This integration breaks the boundaries of traditional retail, allowing consumers to directly complete purchase decisions in

, achieving “convert content-driven interest to purchase instantly”.

China’s retail market is showing a pattern of “stable online growth, differentiated offline performance”[10], and Walmart and Xiaohongshu’s partnership will further intensify competition:

• Warehouse Membership Store Track
  : Sam’s Club (63 stores) vs. Costco vs. Hema
• Traditional Supermarkets
  : Yonghui and others face transformation pressure; in H1 2025, 93 stores were renovated but 227 loss-making stores were closed simultaneously[9]
• Instant Retail
  : Hema NB, Sam’s Quick Delivery, Meituan Flash Purchase, etc. are accelerating expansion

1. Traffic Entry Reconstruction
   : Xiaohongshu’s 350 million MAUs (70% of whom are Post-95s) will become an important channel for Walmart to reach young middle-class consumers
2. Product Co-Creation Model
   : Co-branded product development can achieve differentiated competition
3. Scenario Innovation
   : The “Mashu Store” model may be replicated and promoted, forming a closed loop of offline experience + online dissemination

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Impact Area	Expected Effect
Increment in China Market	The Xiaohongshu channel is expected to bring considerable new customer acquisition; the Post-95 user group highly overlaps with Sam’s Club’s target customer group
E-Commerce Penetration	As the first omnichannel retailer to enter Xiaohongshu’s e-commerce platform, it can further increase the online sales share (currently over 50%)
Brand Youthification	Improve the brand’s image among young consumers through Xiaohongshu’s content marketing
Product Innovation	Co-branded product development enhances differentiated competitiveness

Walmart has taken frequent actions in the Chinese market recently, and its partnership with Xiaohongshu is an important part of its

:

• Meituan Partnership (December 2024)
  : Access to Meituan’s instant delivery network[11]
• JD.com Exit (2024)
  : Sold JD.com shares for approximately 3.6 billion USD, focusing on self-operated e-commerce
• Chengdu Global E-Commerce Office (April 2025)
  : The fourth China office, deeply cultivating inland markets[12]
• Google Partnership (January 2026)
  : Provide shopping services through Gemini AI[13]

This

combined strategy enables Walmart to maximize coverage of different consumption scenarios and user groups.

• **Market Capitalization:
  950 billion USD
• **52-Week Gain:
  +30.56%
• **Current P/E:
  41.49x
• Median Analyst Target Price: 125 USD
  (+4.9% upside potential)
• **Rating Distribution:
  73.4% Buy / 20.3% Hold / 6.2% Sell
  [14]

• Walmart’s full-year revenue in FY2025 is
  681 billion USD
  ; the China market contributed approximately 20.3 billion USD (FY2024 data)[6]
• China’s business growth rate continues to lead globally; 20% growth in e-commerce sales provides experience for replication in the US market[5]
• The cloud warehouse model of Walmart China has been learned and referenced by Flipkart (India) and Walmex (Mexico)[15]

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Based on the current layout, Walmart is advancing the following strategies in the Chinese market:

Strategic Pillar	Specific Initiatives
Sam’s Club Expansion	Open 6-7 new stores annually, expand into second- and third-tier cities; 2026 sales target of 200 billion RMB
Omnichannel Integration	Increase online sales share to over 50%; expand coverage of front warehouse network
Supply Chain Upgrade	Strengthen own brand matrix; optimize local supplier system
Digital Innovation	AI shopping assistant; partnerships with platforms such as Google and Xiaohongshu

Despite strong growth, Walmart still faces multiple challenges:

• Hema: Revenue growth exceeded 40% in 2025, with a 2026 GMV target of 100 billion RMB[9]
• Costco: Accelerating layout in the Yangtze River Delta, poaching high-end customer groups[8]
• ALDI: 62 stores in Shanghai, seizing the instant retail market with low-price strategies[8]

• Food Safety Issues: Sam’s Club China has recently received multiple food safety complaints (over 8,600 complaints on the Black Cat Complaint Platform)[8]
• Homogenization Competition: “Sam’s Club equivalents” are everywhere, diluting its uniqueness
• Member Cost-Effectiveness Questions: Whether the 260 RMB annual membership fee can “save 2,600 RMB” has become a focus for consumers when calculating value[9]

• The overall recovery of China’s consumer market still takes time
• The instant retail track is in fierce competition
• Stricter policy supervision (antitrust for platform economy, data security, etc.)

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1. Significant Strategic Meaning of the Partnership: Walmart and Xiaohongshu’s partnership is a landmark event for traditional retail giants embracing social e-commerce, which will accelerate the online-offline integration process of China’s retail industry.

2. Win-Win Pattern Expected:
   • Walmart gains access to young traffic and content marketing capabilities
   • Xiaohongshu gains high-quality retail endorsement and supply chain resources

3. Strategic Value of the China Market Highlighted: The success of Sam’s Club proves that Walmart’s positioning in China’s middle-class consumer market is accurate, and its partnership with Xiaohongshu will further consolidate this advantage.

4. Intensified Industry Competition: This partnership model may trigger imitation by other retail enterprises, driving the entire industry to develop towards the integration of “content + e-commerce + offline”.

Most analysts maintain a rating (73.4%), with a target price of 125 USD[14]

• Sustained high growth in the China market, increasing e-commerce penetration
• Strong global supply chain advantages, high risk resistance
• Actively embracing AI and digital innovation

• Intensified competition in the China market (Hema, Costco, etc.)
• P/E valuation (41.5x) is at a historically high level
• Macroeconomic uncertainty affecting consumer demand

Through partnerships with multiple platforms such as Xiaohongshu, Meituan, and Google, Walmart is building a retail ecosystem. This strategy of “open cooperation” rather than “closed self-construction” may be the key to maintaining its competitiveness in the complex Chinese market.

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[1] Walmart and Xiaohongshu Reach Deep Partnership - Eastmoney.com

[2] Xiaohongshu’s Profit Expected to Triple to 3 Billion USD This Year - Sina Finance

[3] China Social Commerce Intelligence Report 2025 - Yahoo Finance

[4] Xiaohongshu E-Commerce: Taking a Narrow Path - 36Kr

[5] Overseas Retail Leader Tracking Series — Walmart - Dongfang Fortune Securities Research Report

[6] Sam’s Club’s Rapid Growth, E-Commerce Accounts for Over Half: “External Threats” and “Internal Issues” Behind Walmart China’s High Growth - Sina Finance

[7] Sam’s Club Sells 380 Million RMB Daily, Yonghui Struggles to Survive: Why Are China’s Supermarkets Worlds Apart? - 6Park

[8] Fierce Competition in Retail Formats in 2025: Can Sam’s Club Continue to “Mine Gold” in China? - HeadSCM

[9] Sam’s Club Sells 380 Million RMB Daily, Yonghui Struggles to Survive: Why Are China’s Supermarkets Worlds Apart? - Sohu

[10] 2025 Retail Industry Annual Summary and 2026 Outlook - Linkshop

[11] Walmart partners with Meituan to boost its ecommerce business in China - EMARKETER

[12] China Retail & E-commerce Weekly Update - HKUST

[13] AI Shopping Assistants to Launch Soon! Google Announces Partnerships with Multiple Major Retailers - CLS

[14] WMT Company Overview - NASDAQ

[15] Walmart Executives: China’s Technology and Supply Chain Innovation Provide Valuable Experience for Global Business - China Daily