July 14, 2020

The U.S.- China Tech Battle: Social Commerce, Super Apps, and the Future of TikTok

For as long as there’s been consumer tech to talk about, we’ve framed it as a winner-takes-all battle between the U.S. and China. But is that really fair?

Many argue it’s not. One of those many is Connie Chan, general partner at famed VC firm Andreessen Horowitz and this week’s guest on Business Casual. Chan is an expert in the relationship between China and Silicon Valley, and she’s spilling Sand Hill secrets.

Her biggest bet is on the video-centric future of consumer tech and e-commerce. Because nothing sells goods and services or breeds engagement like watching good video. But who’s positioned to win in a social commerce economy?

In the episode, Chan answers that question and so many more, including what TikTok’s uncertain future might look like, plus…

  • Why super apps that can do it all (like WeChat in China) are becoming the rage
  • What both social commerce and super apps mean for regulation, innovation, competition, and integration
  • And when and how we choose convenience over perceived morals

As Chan sees it, whatever happens in consumer tech in China will make its way to the U.S. in about 3–5 years. The best way to be 3–5 years ahead of the curve? Listen to this episode.

+ Keep in mind: In our next episode, we’re talking about the possible TikTok ban and what it means for creators. Subscribe wherever you’re reading this so you don’t miss it.


Kinsey Grant, Morning Brew business editor and podcast host [00:00:08] Hey, everybody, and welcome to Business Casual, the podcast from Morning Brew, answering your biggest questions in business. I'm your host and Brew business editor, Kinsey Grant. And now, I've got a quick ask. Make sure that you are subscribed to Business Casual wherever you're listening so you don't miss an episode. And now, let's get into it. [sound of a ding]

Kinsey Grant, Morning Brew business editor and podcast host [00:00:28] So I feel comfortable—confident, even—saying that most of us have experienced a shift in our screen time since COVID-19 hit. If you're like me, that means more hours per week watching impeccably made-up teenagers dance to the Beyonce remix of Savage on TikTok. But, even if you're not like me, you've probably started using consumer tech products like TikTok and plenty of others a little differently in the past several months. Since the shutdown, we've come to rely on consumer tech to be a means of communication, an avenue of entertainment, and in a lot of cases, a way to shop online. 

Kinsey [00:01:02] And while it might feel revolutionary to buy a pair of sunglasses without leaving the Instagram app, it is not. The concept of one app serving a multitude of purposes isn't a new concept, at least not in Asia, where so-called super apps are more of the rule than they are the exception. So today, I am intent on figuring out how trends that are the norm in China and other Asian countries can inform what comes next for consumer tech stateside. We're going to talk about the social commerce aspect, the bigger picture themes of technology, migration, and yes, we might even hit on TikTok and the possibility of a ban in the United States. 

Kinsey [00:01:38] My guest today is Connie Chan, general partner at Andreessen Horowitz, where she's worked since 2011, sourcing deals, working with startups, and most importantly, for today's purposes, leading the team's efforts to better connect Silicon Valley with Asia. Connie, thank you so much for being here. I'm excited to talk today. 

Connie Chan, General Partner at Andreessen Horowitz [00:01:54] Thank you. I am a huge fan of Morning Brew. So I'm so honored to be here today. 

Kinsey [00:01:59] Well, thank you. And you being a fan of Morning Brew is absolutely amazing. You were talking before that I think we should put that on our website as a testimonial [Connie laughs] from Connie C. So thank you so much. And part of what you do is observe products and business models that are working in China to see if they might work in the U.S., right?

Connie [00:02:18] Right. Right. Exactly. 

Kinsey [00:02:20] Yeah. So I want to use that framework some today to talk about some of the more specific trends that we've been watching in terms of consumer tech here in the U.S. I think one of the most interesting trends that we've been watching is this idea of social commerce, of using social media platforms, I say, quote unquote, to buy things, to make purchases, to buy goods. And it especially feels like that is pertinent today, because to me, that might be one aspect of consumer tech that COVID is actually bringing a lot of innovation to the fore in. 

Kinsey [00:02:48] So with that said, I want to start with some definitions, because I think that they might be immensely helpful as we have this conversation. We'll do our best not to give away the entire conversation as we do these definitions in next minute or so. But quickly, can you just define, when we talk about consumer tech, what does that mean to you? Is it [indistinct]? Is it, like, a blender? What is consumer tech? 

Connie [00:03:09] Consumer tech is anything that's basically like a non-enterprise [laughs] company, in my mind. We particularly focus more on software-oriented companies. It's not to say we wouldn't invest in a blender, but we're much more inclined to invest in something that looks like an Airbnb or looks like a Pinterest. 

Kinsey [00:03:27] OK. And what about social commerce? What does that mean to you? 

Connie [00:03:31] Social commerce basically means to me that you are leveraging other people that you know or perhaps even that you don't know, but that you follow, to do product discovery or to shop together in a social engaging experience. And I think what social really solves around commerce specifically is the discovery problem, where I do a ton of shopping on Amazon, an embarrassing amount of shopping on Amazon. But yet Amazon's product recommendations to me—I very, very rarely click on them. And social commerce is a new way to think about bringing products you might like directly to you. 

Kinsey [00:04:09] Yeah, it's an interesting point. When I think about shopping on Amazon, I know what that sponsored tag means. I know that the first, what, three or five results that come up in an Amazon search — 

Connie [00:04:18] It's before the search. I always go to Amazon with something to search. I never just sit there on the homepage trying to think of — 

Kinsey [00:04:26] Oh, you even mean, like, when you go to Amazon.com and they say — 

Connie [00:04:30] Yes. 

Kinsey [00:04:30] Shoes of the summer. 

Connie [00:04:32] That's the key part of social discovery. It's about getting you to buy something you never thought you needed to buy. [chuckles] Because you see your friends buying it or because you saw an influencer using it and you're like, oh, I actually really want that bookmark maker, even though I read everything on a Kindle. It's about getting you to buy something that you never thought to go to a store to shop for. 

Kinsey [00:04:54] Right. That's so interesting. And I definitely have fallen in that trap of buying whatever a certain influencer [Connie and Kinsey laugh] tells me. And I'm not ashamed of it. I think that we have people that we trust in these influencer spheres, and we can be, sometimes, not always, we can be really discerning with who we follow and who we trust and what influencers we want to engage with. OK, last definition, because I think it's going to come up some today. Super app. 

Connie [00:05:19] Yeah. Yeah. Super app is something I've been talking about for a while now. And the poster child I always hold up is WeChat, which is a messaging chat communication app that is basically everywhere in Asia, and China specifically. And it's an app that started out with just communicating with friends, but very quickly has now blossomed to kind of an operating system-like experience, where you use WeChat to interact with businesses, services, celebrities, news reporters, media outlets, and so forth. 

Connie [00:05:49] And so you can basically live your entire online life inside WeChat if you really wanted to. A super app is something that takes you into the app for one primary use case, which, in WeChat's case is chat, but then quickly introduces you to other kinds of businesses and services that are not directly tied to that very first product use case. 

Kinsey [00:06:11] It's so interesting and it's something that I think we're going to talk about at length today—the idea of these super apps. There are a couple of big questions that I do want to answer. First of all, how consumer tech trends are evolving in recent months, recent years since lockdown? Second, how they're contributing to the possibility of these super apps here in the U.S.? What does it mean for existing businesses? 

Kinsey [00:06:31] Third, what the relationship between consumer tech in the U.S. and Asia is. So there's a lot on our plate. And I know that we're gonna get to all of this. I'm excited to do it. I want to kick things off with that first question that I posed. How have consumer tech trends evolved in recent months, in your view? What do you think has changed since COVID-19 became a thing? 

Connie [00:06:50] Yeah. COVID has unquestionably accelerated a lot of trends, specifically like edtech. It's so obvious to any working parent [laughs] the strengths and also the very clear weaknesses in today's current offerings. And people are becoming more video-native. People are spending more time in short video and long video. But I think stepping back, there's also a bunch of other trends that have been happening in recent years that are adding to this big change in user behavior. One, we have more smart devices in the home. 

Connie [00:07:21] I have several Alexa Echo devices in my home. I am now listening to more things. I am now listening to more podcasts with AirPods. It's a completely game-changing experience for me to use AirPods and wireless earbuds versus using a plugged-in headset. And so I will now start using things that are audio-only more. There's more of a desire for people to work from home or elsewhere on their own terms and schedule. There's a lot of different things happening in society right now that's causing a big behavior shift. 

Kinsey [00:07:55] The idea of video is really interesting to me, I think probably because we're recording this using a video-sharing type situation here that records our audio for an audio product. I can [indistinct] we can use this video. People have seen me on the floor of my bedroom [laughs] home recording for how many months now. Do you think that this video-first communication, as we do try to get back to some semblance of normal—do you think that this video-first idea is going to stick around meaningfully? 

Connie [00:08:22] For sure. I think video is still way underexplored, and can be a new kind of backbone platform for building all kinds of new services and features. Think about building things on top of Zoom or that kind of equivalent. You're going to start seeing video more and shopping more and edtech more and everything online, really. And it's because video just gives you more information. If you say a picture is worth a thousand words—if I'm shopping again on Amazon and I'm reading a description, it is very different to not be able to see a picture of the product versus just reading the text. Adding video—it's giving you even more information than that. 

Connie [00:09:01] You can see a real size comparison of the stroller to that other stroller. You can get a sense for what that dress looks like on the back. You can have a better sense of what the fabric quality looks like. Video just gives you much more information. And it's also more fun to consume. I love the fact that I can see you while I'm recording this podcast. And I feel like it makes it so much more fun and personable and relatable than if I had only done it through video. Sorry—audio. 

Kinsey [00:09:28] Right, exactly. It's definitely a lot more human. You can see the expression on someone's face. And I'm grateful that we have video tools, especially now, because that's a huge part of this job—is understanding body language and when you're speaking to someone and having a conversation with them, what piques their interest most. When you think of what the next big thing is, what the next big innovation is within this video space, do you have any sort of idea? I mean, edtech is a fantastic example. But if we think about something like Zoom, is there a way to disrupt Zoom to make a better product or to make something that goes on top of it? If you had to pinpoint what it would be. 

Connie [00:10:04] Yeah, there's an investment of ours that I'm extremely excited about, called Run the World. And I'm sure a lot of folks have realized in the last couple of months they are not going to physical, in-person conferences anymore, but [indistinct] staring at a webinar-type of link for hours of a day is just not that engaging. You're not getting that hallway conversation. You're not getting to talk to the person who normally would have sat next to you. There is no open bar right after the sessions are ended, where you actually make all the truly memorable relationships at those in-person conferences. 

Connie [00:10:36] And Run the World is taking their social DNA that they have from working at Facebook and Instagram and replicating all the social relationship-building components of a conference. So giving you the ability to kind of have that side conversation, giving you the ability to literally have a virtual cocktail hour, and taking the fact that it's online and turning it from something that's OK, we're going to work with this online constraint to actually becoming a strength. So, for example, when I go to a conference in real life, I don't really always know which attendees I should be connecting with. 

Connie [00:11:11] I try and do my research beforehand, but oftentimes you just don't know who's going to show up. And then, for me, again, like, I'm actually introverted, so I have to then muster up the strength to go trying to insert myself into that awkward circle who is already talking to each other and hope that [indistinct]. And then I might find out that I have nothing in common with them. And then I can't extract myself from the conversation either. In an online world, you would have perfect information of who everyone is before you even have that conversation. 

Connie [00:11:39] And on top of that, think about if you had a platform that could then even intelligently recommend who you should talk to and say, hey, you two actually have a lot in common. And here are things you can talk about if you don't know what kind of icebreaker to use to start the conversation. That kind of stuff really helps introverts. It really helps people who aren't naturally good at that in-person networking still build all those relationships online. 

Connie [00:12:05] And again, taking it back to that kind of global example. Now, you can attend all kinds of conferences regardless of what time zone you're in. So that they had a conference recently that literally had attendees from over 40 countries at the same time. 

Kinsey [00:12:20] That's crazy. I mean, [Connie laughs] it's a dream, right, that you can use one piece of technology to accomplish so much more than, you know, maybe a handy example, but that Instagram was created to be like a photo editing app. Now it's a communication platform. We're going to talk about it shortly, an ecommerce platform. So, the ability to take one strength and translate that into so many other places, you know, in so many other things you can do, whether that's helping people network at a conference or being the actual platform that they used to hold the conference. 

Kinsey [00:12:55] It all hinges on the ability of these pieces of consumer technology to do more, to do more than just one thing, to serve more than one purpose. So, we're going to take a quick break to hear from our sponsor. When we come back, we're going to talk more about why that's so important. — And now back to the conversation with Connie Chan. All right, Connie. So we talked about it a little bit before. We're verging on the territory of super apps here. [indistinct crosstalk] 

Kinsey [00:13:22] I am like a new fan of super apps after doing research for this episode. Though part of your work that I find really, really interesting—I watched a couple presentations that you gave, some speeches that you gave about it. And I think that this is so intriguing and I can't believe that we haven't thought about it more earlier here, but basically the concept that there is an app for that. But there's also one app that could be for all of that. So tell me more about the idea of apps as an operating system. This is something I find really, really interesting. 

Connie [00:13:51] Yeah. So imagine if you have an application, but then, when you want to go to another a service or access another company or a website or whatever it is, rather than having to open up your browser or go to the App Store and download a new app, you could access a lot of the information and services that you would want all inside of the application you're already spending time in. So imagine again, if you were in iMessage or a messaging app, from there you could directly go order your food, go pay for your food. From there, you could directly pay for your traffic bill. 

Connie [00:14:25] From there, you could get a message from a restaurant saying that your food is ready to be picked up or whatever, and basically spend your time in one application as opposed to having to have multiple applications open. And it's a very popular concept in China because one, again, WeChat really pioneered this idea of an app as an operating system, but two, they also have incorporated a very important ingredient that helps super apps flourish, which is WeChat also has payments. People are using WeChat to send money to each other. People are using WeChat to pay for businesses and services. 

Connie [00:15:01] And once you have an application that wants to be a super app, that also is payment-enabled, think about it as like single sign-on for the web. Imagine every time you go to a website, they already can know a little bit about you and personalize that experience, and you are just one click checkout for every ecommerce site. I would end up buying a whole lot more stuff [chuckles] if I did not have to input my credit card every single time. So in some ways, I guess it's a good thing it's not popular. [laughter]

Connie [00:15:33] But imagine it again. A super app is something that allows you to have that kind of single sign-on, personalized experience for your entire online browsing experience. And the reason why I believe that end users will eventually realize why it's a positive for them is: I am guilty of having lots of browsers open on my PC laptop at all times. I have multiple crumbs open right now. Each one has probably 15 tabs, maybe 20. 

Kinsey [00:16:05] [laughs] Oh, man. 

Connie [00:16:07] And I almost use tabs as my to-do list and I don't clear them out all the time. Using tabs on the mobile phone sucks, right? When I am on my mobile browser—and they've tried to innovate and they've tried to make it better—but it's still just really hard and they're just constrained by the size of that screen. So it's not even, you know, the company's fault, but using a tab experience on the phone is very hard. And the reason why I think super apps became much more obvious in Asia is Asia and China, specifically, is more of a mobile-first, almost mobile-only society. 

Connie [00:16:41] Where you have companies and developers developing apps and not necessarily even having a company website. It's that extreme, where you can literally spend your entire day on your phone. And therefore, if you're first experience on the internet is on your phone, or only your phone, then how do you experience the rest of what the World Wide Web has to offer? You're not going to always want to do it through a browser, through having multiple tabs through multiple websites. In fact, having it in one place, even if it's only sometimes 80 or 90% of the functionality you want, can sometimes be good enough. 

Kinsey [00:17:18] OK, I've got a lot of questions here. So the first one that I wrote down [chuckles] here in my notes—the idea of competition comes to mind when we think about the integration of something like a way to pay in a super app. If you could pay using WeChat to do everything across platforms, what does that do in terms of competition for payment services, like a PayPal or a Venmo? Do all of those startups that have become pretty richly valued just go away if we have these super apps? Do they get integrated into them? 

Connie [00:17:51] They can definitely be integrated into them. Imagine if you are, as an example, say, an Uber, you could pay by credit card, but maybe eventually you can also pay by PayPal or Venmo or anything else. You basically just need to have some kind of payment mechanism tied to the application so that you are one tap purchase away from everything else. 

Kinsey [00:18:09] OK. And this notion of it—people coming to view this as a positive in their lives, something that makes their lives easier, at least here in the United States. A big question mark is how much we want companies to know about us. And I think that you could make the argument that it's just part of American culture right now. But do you think we will ever get to a place where the everyday American consumer feels comfortable going somewhere and maybe being more of a willing participant in a company knowing what they want before they get there? 

Connie [00:18:40] It's definitely true that privacy is probably much more talked about in the Western world. However, I've also seen historically a lot of people end up choosing convenience, and they may say that they want one thing, but then their actual behavior shows something completely different. So I think it remains to be seen and it's definitely an open question. But I do think users value convenience and super apps are all about convenience. 

Connie [00:19:06] It's all about taking away the friction of having to go down load a new app, having to sign up, having to verify your account, having to put in your payment credentials, and then navigate that app to exactly which page you want to be on. Can you cut all of that out and then allow businesses to truly be one, two, three clicks away from completing a transaction? 

Kinsey [00:19:27] Yeah, I think that the example of opening up new tabs on mobile and it being such a headache, it's such [chuckles] a good one because everybody can understand then and knows how annoying it can be. 

Connie [00:19:38] As I describe it, you can feel the pain of it, right? 

Kinsey [00:19:41] Yeah, you can. You can. 

Connie [00:19:43] And yet you can also visualize on your computer—like, I'm literally staring at 20, 30 tabs open at any given time. 

Kinsey [00:19:50] Kind of stressing me out. You have to be stressed. 

Connie [00:19:55] [laughs] But I do think the average person does have multiple tabs. Maybe it's not that extreme. But they do have multiple taps open, right? And imagine on your phone, every time you think to just open a new tab on your browser, how would you do that on your phone? It's not nearly as easy. And so, if an app can just put those things at your fingertips and make it fewer taps for you to get to where you want to get to. That's better in most cases. And especially if you look at an example like WeChat, because there's also a social element, there's again, this idea of discovery. 

Connie [00:20:27] Like discovery I still feel as underexploited not just for commerce, but for all kinds of things. How are we sharing with each other what our favorite products are? Our favorite services are? Right now, because we don't have great ways to do that, we might just share it in very small circles. We might even be emailing or texting just our very, very close friends and family. But is there a way that we can make that discovery element bigger through things like super apps? I think that's certainly possible. 

Kinsey [00:20:53] What do you think the closest thing we have to a super app in the U.S. is right now? 

Connie [00:20:58] You talked about Instagram. I mentioned Uber briefly. Uber, I do think, is one to watch. And it's a non-intuitive one because, again, it's in transportation. And yet when you see them pulling Uber Eats back into the main app, or with the recent announcement of Postmates, you can imagine using Uber for all kinds of things, eventually. This is the secret of super apps, which is you can take something that's high-frequency use case or a long-term use case, and you can lead gen for all kinds of other services. 

Connie [00:21:31] And an example I talk about that's big in Asia is a company called Meituan. You use it to order food delivery. And yet, a couple years ago, they put on some small screen real estate space, a button that allows you to book hotel nights. And now they are used to book all kinds of hotels across China. And they actually recently booked the most hotel nights across any travel provider in China. If you think about what that means, is you can take something like food delivery that can be historically a very low margin business. Can even be a money-losing business, honestly. 

Connie [00:22:07] And then you can lead gen for high-margin services and businesses at basically almost no customer acquisition costs. You're using something, an application that already has distribution, already has traffic, and you're now introducing other products and services that you can monetize. 

Kinsey [00:22:26] Yeah, it seems like such a no-brainer as a way to insulate your business from unknowns. 

Connie [00:22:30] And diversify your revenue stream. 

Kinsey [00:22:32] Exactly. 

Connie [00:22:33] And then think about all the companies that have historically been ad-driven. Once you think about becoming more of a super up, your understanding of the end users, what they're willing to buy, increases, which ultimately makes your ads worth even more. 

Kinsey [00:22:46] Why aren't we doing this, I guess is the question. What's holding back U.S. consumer tech from replicating this in a larger scale way? 

Connie [00:22:55] I do think you're starting to see early signs of it. And typically, when I look at a trend that's taking off in Asia, I think of applying like a three- to five-year time lag for when it hits more of the Western countries. But I also do think a lot of it does come down to design and also historical preferences and user behavior shifts that still need time to change. Because in the Western world, many of us will still start with an online laptop, PC-type browser experience. 

Connie [00:23:26] And then when you go to the application, you kind of already know what the application can do, and you therefore can figure out how to navigate it. It's very different designing for something where you only have the application experience, and you have to then introduce someone to all kinds of services, a different onboarding experience, different design experience. Also, just even different way you organize your company. When you're creating these super apps, you have one release date for all kinds of business lines. And that's a very different way to manage your engineering team than having five, six different apps that can all have different update cycles. 

Kinsey [00:24:02] Right. And I imagine it would just take more talent. You need more people. 

Connie [00:24:05] Depending on how you structure your team, it's possible. 

Kinsey [00:24:09] When you think about the way that our behavior is changed—in the time that it takes our behaviors to change, to adopt a new technology. One piece of tech that comes to mind is TikTok. To me, the way that TikTok took off in the last, I would say, even a year or less, has been incredible to watch. We did an episode about TikTok in, I think it was November, and it felt like we were on the cutting-edge of this new technology. [Connie laughs]. 

Kinsey [00:24:33] We were just talking about monetizing TikTok, and now that is like completely bananas to think about, you know, that this app was ever going to be something that was still a new piece of tech for so many people. Now, it's a huge part of my day. It's a huge part of so many Americans' days. Does that feel like it has potential to gain steam, to integrate other services, to do something like to add some sort of higher margin business to what TikTok does now? 

Connie [00:25:02] For sure. So the TikTok that you see in the U.S. has a subset of features of what the TikTok looks like in China. And the biggest use case that I'd say that has the biggest discrepancy is the lack of the live streaming ecommerce. And so in China, you're already using apps like a TikTok or a Kuaishou, which is another short video application, to buy all kinds of things, clothes, beauty products, but also food. 

Connie [00:25:32] It's really funny. You'll have these farmers who create these huge followings and then they create these short videos of their oranges and they cut it in front of you and they squeeze it. And then late at night, when you're watching the video, you just really want those oranges and you order a box right there and then. Or you'll see fishermen showing you how they catch the fish. And it's truly farm to table. You see what their life is like on the farm. And you get a much better sense of the produce. And again, it's food that you have to buy anyways from a grocery store. Why not support these local farmers, these local fruit growers? 

Kinsey [00:26:04] The idea of buying things on TikTok. You know, obviously the TikTok that we have here is a, oh, I would call it a watered-down version of what it, you know, the form that it exists in Asia. When we think about using TikTok to make purchases, what does that look like in the future to you? The tools are being added on slowly, I would say. But what does it look like in the next year or so? Do you see a future in which there would be a meaningful ecommerce aspect to TikTok? 

Connie [00:26:32] Yeah, I think there'll be more meaningful ecommerce across social companies in general, not just TikTok, but all kinds of companies that were historically not ecommerce, maybe historically more entertainment even, can now introduce more elements of shopping. And again, it's that key understanding that video is still very undermonetized and underexplored. Because video is a really great way to sell stuff. I don't know about you, but when I grew up, I watched infomercials for fun sometimes. 

Kinsey [00:27:00] Yeah. Like QVC has been around forever. [laughter] 

Connie [00:27:04] They really worked on me too. And again, it's because video just gives you more information. And commerce is all about discovery and giving you more confidence to make that purchase. Because again, you don't have that free return, easy return policy like you do on shopping on Amazon. So you have to have more confidence that you're going to like the product before you click buy. And video is just a great way to do that because you can answer questions in real-time. You can get a sense of what the product really looks like. 

Connie [00:27:31] Just think about unboxing videos on TikTok. All of those can lead to purchases. Just think about your bloggers who are really big on beauty or fashion. They can all be doing product discovery for you. It's also really good for how-to videos or gadgets that, in particular, need demonstrations. When you see that cool gadget that helps your cell phone not break or helps you carry your phone with you at all times, again, a product I never would have thought to go search for on Amazon, but yet I might look at it. It's pretty cool. It's less than 30 bucks. I might just click buy right there and then. 

Kinsey [00:28:06] So Connie, I have to wonder what happens to the Amazons, the Shopifys if this pivot to video does come to fruition. Do these big, more traditional since Y2K brands and companies go to the wayside? Do they adapt? Do they do something differently? What does this look like for them? 

Connie [00:28:23] I would hope that everyone jumps into video just because videos, honestly, are just a really good way to sell stuff. [laughs] And I do think you're already starting to see that. I mean, as you look at Amazon, they are doing more things with video. I see many more video examples when I'm scrolling through a list of even results when I'm searching for something. And so I do think more people are just going to realize, hey, I need to have video if I'm going to do commerce. And live is a step beyond that. Live video is a whole step beyond that. 

Connie [00:28:51] But people are also going to learn that when you add video to shopping apps, you are increasing the time spent in the app. And inevitably, that will always mean that you end up buying more stuff. [Kinsey laughs] People are spending time on these apps—these shopping apps—even if I look at Alibaba's Taobao live app, they treat it almost like they're watching a video entertainment app. They're spending that much time on it. And then because you're spending so much time watching what is both entertainment but also shopping, you end up converting a lot more. 

Connie [00:29:29] And you do have happy customers. It's not that you're taking advantage of them because they do have more confidence on those products before they buy them. So, again, think about it as you're increasing the time in the app if you add these elements of videos. So I do think even the incumbents are going to have to respond and realize, hey, I need to get better at having true multimedia experience, because if I give you a text description of any product on Amazon, unless it's a brand you've already bought or a product you already bought, it's never gonna be as good as if I just give you a photo of it. 

Connie [00:30:00] And a video is always going to do the same thing. It's always gonna be better than the photo. You're always gonna get more information. And short video really forces the creator, the brand, to give you that information in as condensed a way and in as fun of a way as possible. Like one thing about TikTok is it's actually fun. How often do you use that to describe really, honestly, any application you're using outside of a game? Think about when you make shopping fun. What that can transform and do around social buying behavior. 

Kinsey [00:30:34] Right. Let's talk about these Asia trends. I think that this is a huge part of the conversation. Do we see things like that happening in Asia? Large scale? When we think about social commerce, is it the norm? 

Connie [00:30:45] It definitely is. And I'd say social commerce can happen in a bunch of ways. One, it can, again, happen on platforms like a TikTok or a Kuaishou, where you're following an influencer. It can also happen where you are buying a product, and then as you get more of your friends to buy it, it drives the prices down. More innovative, more gamified-kind of group purchase products are happening. And also that kind of screen share example, or even choosing items that I recently browsed on Taobao, which again is kind of like their China eBay or Amazon. And then getting my friends' feedback on it. All of those things already exist and are pretty widely used in China. 

Kinsey [00:31:24] I know you talked in the beginning here about the three- to five-year kind of waiting period before trends make their way to the States from Asia. When we think about globalization, it makes me wonder why it takes so long. What's the migration process like for these tech ideas and platforms and super apps and what have you? Why does the migration take as long as it does, do you think? 

Connie [00:31:47] Well, I do think developing countries and developed countries behave differently, again, because some are more mobile-only, mobile-first, and some are still more PC-first. And that changes how people design products, how people do the onboarding. And I also think it's user behavior expectations. If I gave everyone in the Western world all the Chinese super apps today, it would feel like a carnival-like experience. There's too much. It might feel overwhelming. So in some ways, you still have to kind of ease that transition and Westernize that concept to users out here. And so that does take time. 

Kinsey [00:32:24] So the big question that comes to mind when I'm thinking about all of this is these apps sound great. If we could integrate all of this and remove all of this friction and make our lives easier and just change our behaviors a little bit, I just have to wonder about regulation here in the United States, especially when it comes to these big tech platforms. That's a huge question mark, especially this summer. Whoever becomes the next WeChat here in the United States, is it a welcoming enough environment for that to actually happen to achieve the scale of WeChat? I have to wonder if it is. 

Connie [00:32:52] Yeah. If you look at the penetration of a lot of existing social players today, it is also extremely high in the Western world. And they also know a lot of information about you. And it's just that they used to monetize it with ads. They know a lot about your behavior. They already know a lot about who you talk to, what you think about, what you like looking at. And they monetize that with ads historically. And now ecommerce is just a new way to monetize that kind of information and understanding of you. 

Connie [00:33:21] And if you think about an end-user perspective, I would love to see fewer ads. And I would love to see more personalized, instead, recommendations that are things I actually welcome. And things I actually would potentially want to buy, because I see that as more positive additive to me versus something that blatantly looks like just an ad. 

Kinsey [00:33:42] And we touched on it briefly earlier in the conversation. But we in the United States are still trying to get more comfortable with the notion that these tech platforms know so much about us. But that's just reality. They just do. They have known it for a long time. I think it's come to the forefront as a bigger issue in recent weeks, especially the conversation surrounding TikTok. So I have to ask, what is your stance here on recent conversations about possibly banning TikTok in the United States? Do you think that it actually is a national security issue—how much information a company that has a Chinese parent company knows about us? 

Connie [00:34:17] Well, I think regulation of technology is always going to be very country-specific. And so whether or not there will be bans of certain applications here or in other countries, I think is unknown to everyone, quite honestly. But when I tell people to focus and learn about Asia, the key is not to learn about specific companies. It's to learn about business models. And it's to learn about consumer needs, human emotional needs that are universal and practical and not just specific to any one given country. 

Connie [00:34:47] And so the key learning about TikTok is not TikTok itself, but it's the power of what an AI-driven app can look like. It's the power of what a new application that allows new influencers to still go viral because it's so hard to become big on YouTube right now. It's so hard to get big on Instagram right now. What that can do, what kind of hope that can bring to new creators. Those are the key learnings to take away when you look at an Asia app. When you're learning about micromobility as an example, when you saw it take off in China first, you could see that's not a China-specific need. 

Connie [00:35:21] Any city that has big traffic issues, you will see that need for micromobility, for a new last-mile solution. And so, yes, it makes sense that even a country like the U.S. or countries in Europe would want a solution like Lime or Scooters or so forth. There are lots of human emotional needs that just from sheer number of experiments that get run, because there are so many startups that are well-funded in China, that help you identify these new human emotional needs. And then so my job is basically taking those learnings and insights and saying, OK, which ones of those human emotional needs are universal? Loneliness? Yeah. Universal problem. 

Connie [00:35:57] Not being able to find other friends that have similar interests outside of dating. Yeah. Universal problem. And how can you solve that in the U.S. and are current incumbent solving that? No, not necessarily. And then where are those new opportunities? 

Kinsey [00:36:12] So if so many of these human emotional needs are universal, how come we have this narrative of it's the U.S. versus China in the tech sphere? 

Connie [00:36:22] Honestly, those are stories that I do think, unfortunately, psychology drives us to want to read about and want to hear. But again, just if you take it from a pure product perspective, I just see these as different product learnings, different business model learnings. And why not learn from all of the companies that are being created in other parts of the world? It's not even just in China. There are really cool companies coming out of Southeast Asia. Really cool business models coming out of India. 

Connie [00:36:50] Other places that are also mobile-first, that are also mobile-only, where young people are growing up just on their smartphones and not on their laptops. And you're going to see innovation in those parts of the world too. And so the reason why I think developing countries are good to watch is because they are more mobile-native and mobile-native requires you to think about business and monetization differently. 

Connie [00:37:10] Having ads on your mobile phone is a lot more annoying than ads on my laptop browser. Right, though on the browser, I kind of just tune them out. On the phone, you can't; it takes up half your screen. And so if you're in a mobile-first world, you are pushed to not rely as much on ads. You are forced to think of new ways to monetize. 

Kinsey [00:37:30] All right. Connie, that was super-insightful. And thank you so much for your transparency, and the analysis was great. I think that in general, there's a lot more still to learn about things like discovery and human behavior. And definitely, I'm interested in this new era of social commerce, how it affects people on both the social and the commerce side of things. 

Kinsey [00:37:53] And there's a lot of questions still be to asked and answered. But for now, we are going to move into some rapid-fire, have a little bit of fun, because we've asked you some hard questions here. So, I'm taking out our Business Casual wheel. We're going to take it for a quick spin and see what you get. All right. [sound of wheel spinning] [Connie laughs] [sound of a ding]

Kinsey [00:38:14] All right. So it landed on Truth or Truth. How do you study algorithms without getting algorithmed? Is there a way to be objective when trying to understand the way that the tech is working without it knowing everything about you? 

Connie [00:38:32] You know, honestly, when I play with applications like a TikTok and I try and understand how great their algorithms are, I will l delete the app, I will reopen it, and I will just look at different kinds of things and almost create different kinds of personas and just see how quickly can it catch on. And it's — 

Kinsey [00:38:50] Interesting. 

Connie [00:38:51] Really good at catching on. [laughs] I've had feeds where it's, you know, largely art videos and demonstrations where you can't even see the person's face. I also will sometimes have feeds where it's largely dance videos and meetings. Sometimes I get a bunch of fintech products, where people are teaching you how to hustle on the side. So I think, like when you're looking at algorithms, the key is just how quickly does it learn? And that's why I get so excited about something. Not TikTok specifically, but more this new era of consumer apps that are thinking more about personalization and recommendations. 

Connie [00:39:24] Because, I mean, I love using YouTube and I watch so many videos on YouTube, and I've been doing that for 15 years. And yet on their recommendations, they miss most of the time. And I maybe click one of 10—maybe. And on Amazon, again, I shop way too much on Amazon. [laughs] And their product recommendations for me almost never convert to actual purchases. So it's this idea that consumers are going to want more personalization because that ultimately does end up with higher retention, higher engagement, more transactions. 

Kinsey [00:39:58] All right. That makes sense. All right. Take another spin around the wheel. [sound of wheel spinning] Landed on [sound of a ding] If You Build It. So if you could make an app with absolutely no limits—you had all of the resources, all of the talent in the world—what would you build? 

Connie [00:40:13] Depends if my goal is to try and make money or if it depends if I'm trying [laughs] to raise money or if I'm trying to just create something that I think is fun. So I think my answer would really change based off all of those things. I mean, honestly, if I just wanted to have fun, I would love having more AR-type of experiences. Augmented reality. I read a bunch of kids books to my kids now and being able to see, for example, dinosaurs or giraffes like superimposed in front of your house. Those are really cool experiences that I even enjoy and that are really fun. But again, like if I'm thinking about a business model, I might answer differently, so. 

Kinsey [00:40:53] OK. [laughs] That makes sense. It would be awesome, for a parent and for a child. So we'll check back in maybe later with the—we'll do a most profitable idea, go down the list, [chuckles] and see what you've got. [Connie laughs] But Connie, thank you so much for coming on Business Casual, for sharing these insights with us. I really, really appreciated this conversation and I learned so much. So thank you. 

Connie [00:41:12] Thank you so much for having me. 

Kinsey [00:41:22] Thank you so much for listening to this episode of Business Casual. The conversation with Connie got me thinking. Should TikTok be banned in the United States? It's a controversial topic. And I want you to weigh in. So join me in the conversation on Twitter and share your thoughts. I'm @Kinseygrant. That's @k i n s e y g r a n t. And I can't wait to hear from you. See you next time. [sound of a ding]