The actress is the latest celebrity to join the Sulwhasoo brand. Korean popstar Rosé from the musical group Blackpink, was tapped by the line in October 2022. The two celebrities will partner on the skincare brand’s “Rebloom” campaign, which launches this month.

This announcement comes days after Sulwhasoo announced a year-long partnership with The Metropolitan Museum of Art. Sulwhasoo will support the museum through a number of panels and events.

The two partnerships will solidify the brand’s position in the US beauty market, which is a focus in 2023.

Learn More:

Unravelling the K-Beauty Paradox

South Korea is one of the world’s leading exporters of beauty products but the narrow definition of ‘K-beauty’ in international markets means many exciting brands in Seoul have yet to go global.

There’s no hotter topic in tech right now than generative AI.

Since tools like the image generator DALL-E started capturing mainstream attention and ChatGPT arrived promising to upend online search, entrepreneurs have been in a hurry to launch new companies and venture capitalists to fund them. Start-ups are offering generative-AI solutions for tasks from clothing design to marketing copy.

The frenzy, however, feels eerily reminiscent of the crypto gold rush just a few years ago. It’s enough to make bystanders looking on from outside the industry wonder if generative AI is just the next obsession in the hype cycle.

Benedict Evans has spent more than 20 years analysing technology, several of them as a partner at venture-capital firms including Andreessen Horowitz. For him, separating hype from reality is as much a part of the job as trying to predict the ways technology will change the world and the businesses in it.

The independent analyst — and former VOICES speaker — shared his thoughts on how he approaches new products, the potential of generative AI, the likelihood of the metaverse ever becoming reality and how Shein is like Netflix. (The interview has been edited and condensed for clarity.)

Marc Bain: When you think about how to separate hype from reality in the tech world, what are you actually looking for?

Benedict Evans: There’s not a general answer. What is this product? How useful is it? How does it work? How close is it to deployment?

MB: Generative AI is on everyone’s mind right now. On the one hand, it seems like the next obsession in the tech hype cycle as money floods in. But on the other hand, it does seem like a tool that businesses are beginning to use in various ways, and lots of regular consumers are at least playing around with. How are you thinking about this? Is it a potential game changer, or is that yet to be determined?

BE: Generative machine learning is a pretty profound technical breakthrough in solving a broad class of problem. What we’re trying to do now is work out, ‘Ok, where do you apply that?’

If you go back and think about the last wave of machine learning back in 2013, 2014, you had this shift. Stuff that had sort of worked but not very well suddenly started working really well. It seems to be able to do image recognition perfectly. What does that mean? Well, it generalises and it’s not really image recognition. It’s pattern recognition. Where do we have patterns? Where can we apply that? We quickly work out it’s not just images. It’s also translation. It’s natural language. It’s audio processing. But then go beyond that, it’s credit card processing or it’s network planning, or all sorts of things. It’s a whole class of thing that you couldn’t automate before that now you can automate, or maybe we hadn’t realised were things we could automate.

We are going through a similar process now with generative machine learning, which in very crude terms, takes the same models and runs them backwards. You can make anything if you’ve got a sufficient number of examples to provide a pattern. We are trying to work out what that would mean. There’s an absolute explosion now of people very quickly creating companies and creating actual products that you can use, trying to apply those to solving problems for real companies and real people.

MB: Judging by the way Microsoft and Google are going about things, there’s some belief that this could fundamentally change search on the internet. Do you think that’s overblown at this point?

BE: Nothing about this is overblown. This is a big fucking deal. This isn’t metaverse. This is not NFTs. This is like once-every-10-or-20-years structural change in what you can do in software.

Trying to apply this in general search I think is very seductive because in principle you can apply it generally to ‘all the text on the internet’ and therefore it can answer anything where there’s text on the internet. The challenge is that, because of how this works, it’s not actually producing an answer. It’s producing something that looks like what an answer might be. It’s just doing pattern prediction. There’s an error rate inherent in these systems, and the question is, does the error rate matter and can you tell? If you ask ‘What are the symptoms of appendicitis?’ it would be roughly right, probably. But it might not be, and you can’t tell. If, on the other hand, you are saying, ‘Here’s a press release. Write a one-paragraph summary of it.’ Then you can tell what the mistakes are and you can fix it.

That’s the problem with using it for general search: it’s going to be wrong and you’re not going to be able to tell that it was wrong. Now, this is all still very early and the models are getting better very quickly. Say the error rate is 90 percent. Say it will go to 1 percent. There is always that question of at what point is it good enough.

The other side is to what extent is this a product question rather than a science question. Because, after all, Google doesn’t just give you one answer. It gives you 10 answers and says, ‘I don’t know. It’s probably one of these.’ Whereas ChatGPT is saying, ‘This is the answer.’ So it could be that there are ways of presenting this from a product side to communicate the uncertainty.

MB: You suggested generative AI is a much bigger deal than NFTs and crypto. While I definitely wouldn’t call you a crypto booster, I also don’t get the impression you think it’s all a scam. What are some of the useful and valuable features that might have a viable future, assuming you think there are any?

BE: Crypto is a very low-level technology that would enable a whole range of different applications in about five years’ time, once an awful lot of intermediate infrastructure has been built. But at the moment it’s like looking at the internet without web browsers. There are a lot of intermediate layers between what we have now and what an actual useful application might look like. At the point that you are actually able to build and scale applications, well if you were to build ‘Instagram on a blockchain,’ then it would work differently in a bunch of interesting and important and potentially useful ways. We’re not really able to do that yet.

MB: One talked-about use of NFTs would be to enable users to prove ownership of a digital asset and be able to bring it with them across different virtual spaces. You could buy a digital item and use it in different gaming environments, which could be important for digital fashion. Do you think this sort of interoperability is achievable?

BE: I don’t think this is really a technical problem. I think this is a product problem. To put it very simply, if I go into a flight simulator and I buy an F14, and then I close that game and I open Fortnite, what am I supposed to do with an F14 in Fortnite? If I buy a costume in Fortnite and then I close Fortnite and I open FIFA, what happens with that? The degree to which assets have meaning between different games is not necessarily very strong. So I’m sort of hesitant about this idea that somehow all the assets will move between all the different games. Technically it’s not very difficult. It’s just from a business point of view and a product point of view, I’m slightly perplexed as to what that would mean and in what context that would actually make sense.

MB: You also implied the idea of the metaverse is overblown. Do you think we’ll ever have a metaverse that looks the way people like Meta founder Mark Zuckerberg imagine it?

BE: My conceptual problem here really is with the term ‘the.’ The idea that there’s sort of one thing that all works in one centralised, unified way. To give context to this, if you go back to the early ‘90s, there’s a moment when people realise that these PCs are a big deal and lots of people are going to have a PC and maybe they’re going to be connected to networks. What would that mean? And so you get a whiteboard and you write all sorts of stuff on the whiteboard, ideas like multimedia and interactivity and video and graphical user interfaces and convergence. You draw a box around this on the whiteboard and you call it the information superhighway. Who’s going to build this? Well, Disney and The New York Times Company and AT&T and Bertelsmann and Viacom. Here we are 25 years later and we are doing all of that stuff, but it’s not the information superhighway and it’s not those companies and it’s not one unified system.

People have these conversations, ‘Well, in the metaverse it’ll work like this.’ Number one, you can’t possibly know the structure of the output of thousands of companies trying to work out what to build and consumers working out what to use in 10 years’ time. It’s like sitting down in the year 2000 and describing how the mobile internet was going to work.

MB: I noticed you keep an eye on Shein, which is unusual for a tech analyst. How much of its success do you think is a result of data prowess versus having this fairly unique supply chain set up that no company outside China can really copy? How much of a technology company is Shein really from your point of view?

BE: I tend to draw a line from Shein to Netflix and say, ‘What are the questions that matter for Shein?’ They’re really all apparel questions. What are the questions that matter for Netflix? They’re basically all TV questions. There are no technology questions here.

I look at it because I think it’s interesting to see this company using these models to shift fast fashion, using the internet as a new channel and a new route to market in not very different ways to the way that Netflix does.

MB: As somebody who watches a broad swath of the tech industry, are there any other emerging technologies that you’re excited about that it’s worth fashion and retail keeping an eye on?

BE: I think part of what’s going on at the intersection of tech and everything else is that most of what’s being deployed is ideas from 10 and 20 years ago. The tech industry is obsessed by what’s going to happen in 10 years’ time or five years’ time. But meanwhile, most of what’s actually getting built is ideas from 10, 20 years ago — ideas like maybe people will buy stuff on the internet. We are simply working out how to deploy ideas of basically 10 and 20 years ago to new sectors in new ways.

Last year was challenging for Farfetch, but there was at least one bright spot for the company.

Farfetch’s app was its “most profitable and fastest-growing channel,” Stephanie Phair, group president, said on the company’s earnings call in February.

Companies such as Nike and Levi’s have also pointed to their apps as key drivers of digital sales. For fashion retailers, an app that gives them real estate on a consumer’s phone screen and a direct line of communication through push notifications is enticing. Consumers can check their devices more than 50 times a day. More and more often, they’re doing so to shop. The share of US retail sales happening via mobile is forecast to reach 8.7 percent in 2026, according to Insider Intelligence, up from just 4.1 percent in 2019.

So should every brand have an app?

“Oh gosh no,” said Sucharita Kodali, vice president and principal analyst focused on digital strategy at Forrester, a research and advisory firm. “For the most part, it’s not that necessary.”

For every Farfetch, Nike and Levi’s, there are countless brands with apps nobody uses. Consumers are selective about which ones to give space on their screen, and some brands have discovered a mobile-optimised e-commerce site accomplishes the same goals for far less expense. Patagonia notably shut down its app in 2016, saying its newly phone-friendly site would handle its mobile commerce.

Building an app can also require considerable money and effort.

“We found out quickly that application development comes with an entirely different set of demands than an e-commerce site,” Kate Ridley, chief brand and product officer at Allbirds, wrote in an email. They needed developers with Apple iOS experience, designers who knew mobile design, product managers who understood the intricacies of iOS and marketers who knew how to grow an app’s user base.

But when an app works, it can pay off. A 2019 study found customers who downloaded and used a retailer’s app tended to buy more frequently, purchase more items and spend greater amounts than non-app customers. (They also returned more items, but the researchers concluded there was still a net increase in value.)

“We often find that customers on our app have a higher repeat purchase rate and are some of our highest lifetime value customers of any of our channels,” Ridley said.

Downloads of e-commerce retail apps also grew 11 percent globally in 2022 compared to the previous year, according to Data.ai, a mobile analytics firm.

Apps are clearly worthwhile for some at least. Here are points to keep in mind when considering whether to launch one.

Which Fashion-Retail Apps Are Shoppers Using Most?

While brands with larger customer bases generally have more app users, the fast-fashion and athletic segments saw some of the highest numbers of monthly users in 2022, according to a Data.ai review of apps selected by BoF.

In addition to there being strong demand for their products, these categories lend themselves to app features that can draw users back. Activewear apps might offer fitness information; in Lululemon’s app, logged-in members get access to free classes, for example.

Fast-fashion brands, meanwhile, regularly release new products or lookbooks to browse and can employ the same addictive tricks as gaming and social apps. Shein — the clear winner in usage — is designed to feel more like a social app than pure retail, according to Lexi Sydow, head of insights at Data.ai, which estimates Android users alone collectively spent nearly 35 million hours in the app in 2022.

“You’re ‘hearting’ items versus adding to cart,” Sydow said. “There are all of these gamified exclusive discounts and they’re encouraging you to sign up for push notifications or SMS text messaging.”

Shein also has a comprehensive strategy to get users to download its app. It runs paid ads in the app store and frequently updates all the imagery on its page to promote sales pegged to special events like Black Friday or the Super Bowl.

While apps from luxury brands tend to offer innovative features, their low user numbers make sense “given the pool of folks in that bracket to purchase might be a bit smaller anyways,” Sydow said. They’re also not the sorts shoppers visit daily to see new items. Several luxury apps, including Saint Laurent’s and Valentino’s, didn’t have large enough user bases for Data.ai to provide usage metrics that met its standard of confidence.

When Does It Make Sense to Launch an App?

The larger a company, the larger the potential audience for an app, but other factors also influence downloads.

“We see two big drivers,” said Ben Nassler, vice president of consumer apps at NewStore, a platform for commerce services that has made apps for brands including Golden Goose, G-Star Raw and Scotch & Soda. “A brand that is really strong with a strong following, those customers are very likely to also demand an app. And then if a brand has some share of repeat purchasers, that’s the other part of it.”

Consumers are also more likely to use apps that offer additional capabilities beyond what a website provides. Users of Nike’s app can scan products in-store for more information or to save them to a wishlist. H&M’s app provides a similar in-store function to find colours and sizes available and a visual search where users take a picture or use one from their phone to find similar H&M products. Golden Goose made its app a key piece of its loyalty programme, Nasser said, sharing exclusive offers and first looks at new items.

Which Features Should an App Have?

Launching with every feature possible isn’t necessarily the best option, however, especially for young brands.

“If you’re a start-up … less is best,” said Ranji Persad, vice president of North American sales at Net Solutions, a custom software developer with large and small clients.

First, brands should be clear about what problems they’re trying to solve, what features they absolutely need and what demographics they’re aiming at, he said. Then they should get their app out quickly, ideally within five months. A common mistake is adding more and more features that extend the timeline.

But Nasser also warned about doing too little. He’s seen apps flop when brands release the minimum viable product. In his view, options like product recommendations and attractive lookbooks are table stakes. Brands can add features like in-store options or virtual try-on later.

Ultimately, the priority should be nailing the commerce functionalities. Sydow said apps should inherently streamline the user interface and customer experience, “which helps to speed up and encourage that transaction process.”

How Much Does It Cost to Build an App — and Maintain It?

The experts BoF spoke to said the cost of an app can range from tens of thousands of dollars to more than $1 million.

Fashion companies often need to hire outside agencies to do the technical work. If a brand uses a software-as-a-service application with tools to create a storefront and there’s minimal custom work involved, the price for a barebones app could be $20,000 or even less, according to Persad.

But what makes apps expensive is their features: the greater the number and the more complexity, the more development is required and the higher the price. Loyalty options and product recommendation are expensive. There are additional costs to consider, too, such as the content management system and backend infrastructure needed for sending push notifications and updating content regularly.

Nasser, who worked on the relaunch of Hugo Boss’s app several years ago when he was at the brand, said if a company is building everything from scratch, a minimal investment for an iOS app would be $300,000 to $400,000. An Android app would be an additional amount. (NewStore markets itself as a way to help mitigate these costs with its platform.)

The expenses don’t end when the app launches. Developers are constantly fixing bugs and making updates. When the iPhone 10 introduced a full-screen display, for example, it meant each screen in an iOS app had to be redesigned, Nasser said.

When an app connects with shoppers, though, the rewards are worthwhile. Since G-Star Raw released its app in 2018, it has used it to offer loyalty benefits like early access to sales. Customers with the app use it about three times as much as its desktop or mobile site, according to NewStore, and as of 2022, it accounted for nearly a third of the brand’s total e-commerce revenue.