TikTok Outperforms Competitors by 2X in Social Commerce, and the Debate Between Long and Short-Form Videos

0:00In other words, TikTok is performing better in theory from social commerce than all the other social apps, at least when it comes to the United States. I believe it but also part of the reason I believe it is because the way they understand social shopping better than the other apps because they started originally they've been doing social shopping for such a long time and so they understand how what what converts well what tends to get humans to tick because sure you can say the Chinese are different people and sure we behave differently I'm Chinese but at the end of the day human behavior is pretty similar when it comes to still buying stuff online and it's a lot of it's gamified right it's the UX stuff to me is gamification so.

0:41Dude, totally agree with this. I also don't know if some of the other apps are trying to bypass Apple's revenue share. They could be trying to do things outside. How much? I don't know, if any, right? They could actually just be passing all the revenue through Apple. Maybe not. But like, for example, I know if I'm not mistaken, I haven't purchased on Instagram in a while, but they have a direct partnership with Amazon. So I don't know how that affects the app revenue when you're clicking on Amazon, bud. But yeah, it just shows that just because something is not as popular, like TikTok doesn't have the user base as Instagram, doesn't mean that you should neglect it.

1:20Sometimes one platform may have less users. They may even have less active users. But if they're much more likely to buy, who cares? You can end up making money. And this is why Eric and I don't believe TikTok is better than Instagram or Instagram is better than TikTok or Facebook or YouTube. we're big believers that you just leverage all the platforms for the for what you can and make the most amount of money as possible on these platforms yep and speaking of video because we're sitting on video already you have this one around um long form versus short form views which one should you focus on short form videos sorry or long form videos and so neil and i we had a little conversation yesterday um when i was heading to the airport but go for it too many people spend time recording short form videos.

2:07Eric and I are big believers in recording long form video and chopping them up into short form. It doesn't mean we don't record short form videos at all, right? There is a purpose for short form. But what we found historically is short form videos are great at bringing people in. Long form videos are better at converting people into revenue. And you may not get the views from long form that you will from short, but it just converts better. And if you don't believe us, Mr. Beast has posted quite a few times his some of his revenue earnings from videos, short form barely makes him any ad revenue versus long form makes him an arm and a leg.

2:44Why is because the viewer that's watching long form, even if they also consume short form, it's just they're more engaged with long form, they're much more likely to convert more. Hence, advertisers are willing to spend money. Advertisers would have already been willing to spend an arm and a leg on short form videos if they could drive people from a short form to the website and get them to convert. It's because the conversion metrics aren't flowing through, the ad spend isn't as high compared to long form. Hence, everyone is focusing, at least advertisers are focusing on long form because it just generates way more revenue.

3:17I just believe that short form is cool and there's entertainment factor. For example, when Neil and I talk about discounts, or we talk about Shake Shack, or we talk about Laurel Piana, it's entertaining, right? But that only goes so far. When you go long form, you go five minutes, 10 minutes, 15 minutes, 20 minutes. If someone watches a one-hour talk, you're building a deeper relationship with them. And when you build a relationship, people remember you for that. And you're actually teaching them something too. At least we are teaching them something. Let's do two counter examples. I remember one Mr.

3:47Beast shorts, okay? I think one, they had a Lamborghini driving through like one tape, one piece of tape, And then I think like, you know, a thousand pieces of tape, a hundred thousand. And then eventually like they couldn't, the car couldn't run through it anymore. Right. Now that was interesting. That was entertaining. But I tend to remember the Mr. Beast videos, like when he did Beast games, for example, that was, that was an entire season. I think it was 13 episodes or so, but I actually got to know the, you know, his contestants a lot more. I got to understand, you know, how he went, how he goes about doing his shows.

4:19Right. And then you got to see a lot of behind the scenes stuff. So I got to understand him a lot better as a content creator, as a business person, and also an entertainer as well. And so when I start to think about, oh, how does Mr. Beast do things? I think about that stuff. I don't think about the shorts. And I mean, I feel like I know him. And long form gives you an opportunity to build a one-to-many relationship, whereas I think a short form, it's a gateway drug. Yes, and we both create long form videos. And Eric and I were discussing this the other day. Some of the consultants and people I use help me out with editing and stuff.

4:54They're like, oh, yeah, you should just drive everyone to YouTube. Only post your long form videos there. And I'm a big believer in, sure, I may put on YouTube first and keep it there for the first week or two weeks exclusively. But I'm going to put it everywhere where my audience is. Don't try to. Most people don't have Mr. Beast's revenue model or business model. Don't try to drive people from all the other platforms to YouTube. instead just show them the content wherever they are yep and mr b's his style just so everyone knows this and he knows this too his his his ideas his are to go widest ham right so largest largest total addressable market he wants to reach the widest art audience he wants to get the most eyeballs that's not my business that's not neil's business at all and um what we're ultimately trying to do here is we are trying to drive people um to our to our business to ultimately convert and i I think his model is I'm going to try to drive the most amount of views to my YouTube channel because that's where I want to be known for being a YouTuber.

5:57That's what he is. We're not YouTubers here. And most of you watching this are not going to be purely YouTubers. You have to think about what's going to drive the most amount of revenue for you and then optimize for that type of funnel. Just because one person does it this way doesn't mean you need to do it that way. And by the way, just because we're saying we do it this way, it's what works for us. So you have to find out what works for you by testing over time. dude I was at a conference yesterday in Arizona when I was at this conference someone stopped me as I was walking by and they said hey I got a question for you when you're getting all this content do people ever come up and say hi hey Neil I see you on YouTube or I see you on Instagram or I'm like yeah every once in a while and then they asked me what do you do to optimize for that so you can grow it and it made me remember or think about a time where I have a friend who lives close by he drives a ferrari an expensive one like one of the most expensive ferraris that you can buy and wherever he goes people tell him hey what's up you know like good to see you can i take a picture and my buddy was asking me don't you know don't you want that i'm like i get a little bit but not as much anywhere near as you or gary veer tony robbins or anything like that he's like don't you want that he's like if you create more content on broad stuff you'll get so much more of that and I'm not saying it's wrong or right or I'm not saying that you should optimize or you shouldn't optimize for more people to recognize you.

7:20My model has always been create content for my ideal audience and focus on what drives revenue because at the end of the day, at least with me, I rather focus on what's making me money versus what's making me quote unquote famous. Some of the wealthiest people that I know, no joke, that are on the Forbes list have 10, 20 plus billion dollars, like literally, and you can look them up on Forbes if I mentioned their name. But if they walk down the street, you would not know who they are. And I'd rather have that than everyone recognizing me and not generating the revenue. Yeah, well, the other thing is, you know, part of the game is you've already played the game up to this point and the leverage is already there.

8:02So you might as well continue. But I think if you're to go back in time, if you could find a way to make 20 billion dollars and be anonymous you would just do that um but you know it's just where it's just the it's just where you stand at the moment yes but if i had to go back in time i don't know about you i wouldn't have built a personal brand if i was starting all over again no i dude i just like staying at home and and like working and working out and so that's all same yeah i have people who like i have buddies like go out to dinners all the time really late at night Eric and I on a side note sleep quite a bit early we also wake up really early and like doing all these things like so what do you like doing for fun I'm like uh staying at home chilling with my family uh watching television while I work uh staying healthy and like what do you do for fun eat a little bit of ice cream stay at home where I like my life it's not that complicated to see all these other people that have really complex lives and like oh it's amazing and i'm like dude your life sounds exhausting yeah and dude so like i think growing up everyone tries to force their definition of success onto you and everyone has their own definition of success and we're not saying our way is the right way here either and i think you have to figure out what works for you because here's the thing um this is interesting because these last couple days and then we can move on to the next topic you can pick.

9:29But Friday, I had a retreat that I went to, okay? And I came back Sunday. And then Monday, I hung out with my EO forum. And I actually have a story to tell around one of the persons from these groups. I'm not going to name who it is, but let's just say this person was$2 million in credit card debt, was about to shut the business down. And now they're doing$21 million in EBITDA bootstrapped. and I'll come back to that in a second. So Monday, there's a dinner with my old EO group and then now I'm in Mexico for the, we call this the, we call it the Tulumunati, right? And this is where Syed's there, our mutual friend Yaniv, Patrick Campbell's here as well.

10:10And so it's interesting because this group, we don't really drink or party, but we're here to just talk about business, hacks that we're trying, AI stuff that we're doing, problems that we're having with business, any introductions we can make um we play basketball we play tennis we think we're gonna play football and soccer but we're here to just crank on business we're not here to party now some of the other groups that i've been to in the past um there will be a lot of partying and i'm just like dude like i i just want to go home and sleep man so um anyway you have to decide what works for you but um also i would say one thing because because i like to talk a lot about these groups and joining these groups.

10:45That's not really for Neil. But every group I'm in, there's a different purpose for it, right? So if you're going to join these groups, understand that you need to have a goal for each one. And if you don't, it's going to be an aimless thing for you. And you're going to end up really pissed off. When I first started my business, the overwhelm was real. I didn't have the tools to help me scale. If only I had Shopify from the start to handle all the behind the scenes work. Shopify is the platform behind millions of businesses globally from huge names like Mattel and Gymshark to the smallest brands just getting started.

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13:28Do any of you know anybody that's hiring or would any of you hire me basically? We're like, dude, you got to keep going, right? Like this is the entrepreneur rollercoaster. Like it's going to go up and down. You got to keep going. He's like, I don't think I can do it anymore, man. I can't even look at my kids anymore. And he looks so dejected. And he's a really strong person, right? And then we all just told him to keep going. And none of us are going to take the credit. Like we just told him to keep going because we know it's tough. So he kept going. And what ended up happening was last year, let's say they did about 10 million in EBITDA.

14:02And then this year, they're going to do 21 million. But that's the key thing. It's sure he had a support group around him of entrepreneurs that said, keep going. But the main thing, I think the biggest thing was that next to him, obviously not giving up was his wife told him that if you, if we end up on the street, I will be there with you. And all of us were like, dude, that's a damn good wife, right? Like they will come hell or high water. Like it doesn't matter if you have$0 left, I will be there with you. And that actually gets me a little emotional thinking about that because it's like, it's hard to find people like that, right?

14:35So he kept going. And then now he's on track. He's he I think he's going to run through a process. And, you know, he reportedly he can sell for probably around 200, maybe 275 or so. And he owns a lion's share of the equity. And so I think we you and I have seen a lot of stories like this. But I constantly love to hear stories like this, because they're so motivating, you know, for you and me and even for the listener. Well, what's amazing is his wife is ride or die. They're going to see together, they're going to die together. I love that. What was the change that he made that took him from negative 2 million to call it positive 10 million because he hasn't done 21 yet, right?

15:11So what was the change? I wish I had a really good hack to tell you. And I think you know what my answer is going to be. But sometimes us entrepreneurs were so stubborn that we just don't know how to give up. And I think he said he wanted to give up, but I don't think he knew how to give up. and so he kept going and that's what got him there. So I wouldn't say he made some amazing hires or had some amazing hacks. Sure, his team has dialed in now but they don't necessarily have a lot of people. They have like 40 people or something like that. Now, going back, when he was negative two, how long did it take him to get to 10 plus in profit?

15:46Okay, so let's think back to this. Because this roller coaster couldn't have been a one-year swing. No, it's six or seven years. Got it. Good for him. And good for his wife for pushing him and motivating him. People don't realize that your spouse, whether it's a dude or a chick, your spouse can really make the world of difference to your success. Yeah. Or can help you fail if you pick the wrong one. Well, Neil, you should explain why because you're married, right? I mean, can you explain the logic? Like, why do you think that is? they support you um i've been through ups and downs as well and i made money before i got married but post getting married i've had issues and when i say issues sometimes in business you have ups and downs like someone tries to sue you and take some money even if you believe you're right and you're fighting them and you're spending hundreds of thousands a month on legal fees and you know it's just gonna be cheaper to settle than it is to drag it on for years.

16:49So then you got to pay up. Sometimes you a business goes sideways, and you can fix it, but you have to reinvest a lot. And to do that, you may have to sell your house and liquidate some other assets. And if you look at me, I've changed houses on average, once every year and a half, no joke, not renting, buying, which becomes really expensive. And my dad would always tell me, if you just kept all your houses you would have made a killing and he is right but if I didn't take the money when I needed it because a lot of times I liquidated because I needed the cash my business wouldn't be as large as it is today so when I look back on everything my wife was really supportive and she would tell me we don't need a house do whatever you think is best for the family in the long term sell whatever you need and I always bet on the business I bet on myself.

17:44She supported me never complained. I remember one time we spent two and a half years building her dream home. And I sold it in 30 days. Yeah, I never understood that it was a really nice home too. And she was she was super sad. And when I was saying like I built a really nice home, built it from the ground up, it was 8400 square feet. I spent majority of the cost was construction. I spent I think 14-15 million dollars just building it for like 8400 square feet that's a lot of money to spend on building a home so like quality was really high not gold faucets but everything that you can imagine every room had five or seven channels surround had most rooms had hundred inch televisions multiple kitchens you know like whatever high end appliance you can think or floors imported from France.

18:42I think just furniture, we probably spent I think 1.6 million bucks or something like that just on furniture, not our work, just literally furniture. But she supported whatever decision that I want to make that I felt was best for the family because I wanted the cash to reinvest in something else. And she's like, go for it. Although we're building again right now is hopefully I don't make her go through that all over again. And I don't think I will. I think We're pretty much done with that kind of stuff. But yeah, and for me, just going hard to grow in the business makes me happy. And my wife supported that from day one.

19:16But speaking of having support and doing whatever is best, I know Eric's also doubled down a lot. I'm curious, and this is a tangent. You've been an entrepreneur for I don't know how long now. It has to be more than 10 years. Call 11. Something like that, right? When you first started off, what was your definition of success? What do you think success looked like? And I'm curious, after you answer that, what success looks like for you right now? Yeah, so success for me in the beginning, I'm sure it's the same for most people. You just want a lot of money. You want a lot of material goods because you're taught that that's what success is, especially me being Chinese.

19:57Guys, the only thing we have as Chinese people is a money god. right? We don't really have religion and things like that. So all my parents talked about, and this is not their fault. They talked a lot about money. They talked a lot about stocks growing up and things like that. So I've been conditioned to think that way. Now, when I think about success, to me, it's working on what I want to work on. This is more philosophical. It's learning every single day. It's working with people that I want to work with. And it's me building the biggest business that I can build, not because I want a lot of money or anything like that.

20:29It's more because I want to see what I can do to the best of my ability. And I like the numbers because it's a nice scorekeeper and I look at business as the ultimate game. And so every day I wake up, I don't know about you, Neil, you probably feel the same way. I feel lucky every morning. I feel like, oh, I get to play. Sure, the problems are really annoying and I especially hate the people problems, but this that we're doing right now feels like a game, right? Because we're depositing into these algorithms and then hopefully we get some reach back from it. And then us, you know, our relationship continues to build whenever we do this.

21:01So I enjoy what I'm playing. And I think I just I want to enjoy what I do every single day. And that to me, as long as I'm learning that to me is success. Yeah, and I remember when I first met you, you cared more about things like nice homes, cars, and all that kind of stuff. You were never really addicted to like nice cars or anything like, you know, some people dreamed about Ferraris. I never really saw that from you from day one either but you did like nice things um and nowadays you have a nice porsche i love the color of the porsche i don't know what color it is but it's a really unique color you've had it for a while it's like coffee brown yeah and eric was texting me the other day uh we were talking about the g-wagon because he was at this place and they had uh g-wagons at some hotel resort that people were just using no it's it's mercedes um rented out that place for an internal um like retreat and there were like 20 g wagons and they had g wagons all over the the property and then there were like g wagon pillows everywhere so oh cool and when uh eric and i were texting back and forth we were talking about the g wagon i was texting about the new one because it's electric and he's a guy's too expensive and when you look at eric's life right now he has nice clothes he has a nice apartment um he doesn't really ever show pictures of it he has a nice car i don't think you've ever posted about your card either.

22:21All he really does is he cares about succeeding in business, not necessarily from the aspect of people knowing he's succeeding. He doesn't care to talk about revenue numbers. He's done well in crypto. He doesn't care to talk about his crypto holdings or anything like that. For him, success is just an internal metric for him to see his own self growing each and every single year, which brings satisfaction. And I would say for me, it's very similar. When I started off, I wanted stuff, whether it was homes or cars or nice clothes. At one point, even things like planes. And now I don't really care for anything other than just making sure that I'm growing each year.

23:03I'm healthier each year. I'm learning more each year. And Eric and I have a very similar mindset. But when people are younger, they think very differently. Yep. Yeah. So that's our little philosophical corner for you all and how we think about success it'll evolve over time um yeah the the number one metric neil optimized before when we're in our mid-20s was money i think now you optimize probably number one for you is probably family am i right yes because if i wanted more money i would travel if i travel and i speak at a ton of events which i turn most of them down uh my company would grow faster but i choose not to.

23:41All right. So that is it for today, guys. Please don't forget to rate, review, subscribe. And there will be no more Agency Owners Association. We'll save that for another Marketing School episode. And that being said, we'll have some other things to throw your way in the near future. So catch you later.