As Slack has successfully gone public via a non-traditional listing route, a potential Chinese rival is gearing up to eat part of the pie of enterprise messaging.
Or rather, Lark by Bytedance is fighting against Slack in seizing the growth market of enterprises – especially small and medium ones – that have not migrated to a truly productive productivity suite.
Why is Slack dominant
We still remember the days where Skype was the norm in startup communications, domestic or cross continents. A big unicorn in Southeast Asia with thousands of employees even used Skype at its reception – receptionists will ping the host via Skype if there is a visitor.
Alas, as Skype was transformed beyond recognition by Microsoft, space is filled by Slack and Zoom. Both have near cult following (as Jira commands in the tech project management space). Those who have used either tool, when moved to a new organization, will actively promote their adoption.
That is the reason many of Slack’s rivals did not take off. One example is Jandi by Toss Lab based out of Korea. In the beginning, it faced a dilemma: those users who do not have the needs will find it hard to pay; those who are educated would find Slack and use it instead.
The same parent as Tik Tok
The good thing about Lark is that it is part of Bytedance, which has traditionally been successful in breaking into consumer markets both inside China and across global markets. its UGC short video app Tik Tok is extremely popular among young people almost everywhere.
Tik Tok is what we see as the most viable competitor to Snapchat or Instagram for brands’ advertising dollars.
In comparison, Ding Talk and WeChat for Work, operated by Alibaba and Tencent respectively, are distinctively Chinese and most of the foreigner users find them hard to comprehend or use. Only those who have daily needs of communicating with their colleagues in China use either tool.
Pricing as a weapon
So no problem from a product or marketing point of view if Lark does it seriously. How about branding versus Slack?
There is one tool that Lark can leverage: its parent ByteDance is extremely profitable from its Toutiao and Douyin (Tik Tok’s China version). Therefore theoretically Lark does not have the profitability pressure – this is a big advantage as Slack only makes money from Slack. Especially now that Slack is a public company.
If you notice from the pricing page on their web site, the suite is essentially free – with all the paying options “coming soon”.
That said, as Lark is experimental and small within the organization, how much commitment ByteDance really has is probably the biggest determining factor of how successful it would be.
And they have NOT always been successful. They tried to copy WeChat with an app filled with SnapChat-like features. Although it prompts WeChat to introduce similar features, ByteDance’s Duoshan app itself is not that successful.
That could create one problem – buyers of business productivity suites care more about reliability rather than small differences in pricing.
Lark (or Bytedance) needs to convince them of that.
Strategically they have to, even without considering external users – as a rival to both Tencent and Alibaba, they need their own productivity software, instead of depending on WeChat for Work or Ding Talk.