Superapps: The Trend You Can’t Ignore

In June 2020, Careem launched a suite of additional services – grocery and food delivery, online shopping, payments, and e-bike booking. By integrating a wide range of services in a single platform to cater to their users’ myriad daily needs, Careem has become a superapp.

Superapps: The Trend You Can’t Ignore

In June 2020, Careem, the Middle East’s leading ridehailing platform, launched a suite of additional services – grocery and food delivery, online shopping, payments, and e-bike booking. By integrating a wide range of services in a single platform to cater to their users’ myriad daily needs, Careem has become a superapp.

The launch was a tremendous success: as of 2021, Careem has over 48 million unique users. While Careem has the distinction of being the first superapp in the Middle East (besides Turkey and Iran), the concept of the superapp first emerged in China and Southeast Asia. WeChat, Alipay and Grab are examples of pioneering superapps in these regions. In India, Paytm and Reliance Jio have led the way, followed by Tata Neu.

Superapps usually start as single-purpose apps, focused on a core high-frequency service like payments, transport, or chatting. WeChat, one of the most successful superapps today, started out with a core messaging service, while Grab started as a ridehailing service. When these apps experience exponential growth around two key metrics - high daily usage rates and a large volume of monthly active users (MAU) – they often pivot to superapps.

What are the benefits of superapps?

Superapps offer convenience to users and increased revenue opportunities to the parent company.

The Convenience

Given WeChat’s voluminous MAU base – 1.27 billion as of the last quarter of 2021 – offering more opportunities for daily user engagement is a no-brainer. By stitching together a web of sticky core services into their platform, superapps offer one-stop-shop convenience while retaining customer loyalty. They are the digital equivalent of a shopping mall or a retail superstore. Further, by centering on highly functional core use cases like payments and mobility, they draw in customers who use these core services frequently.

The services offered by superapps are not necessarily linked to each other, although some extensions make perfect sense. Adding bikesharing, scooter rentals and airport transfers to ridehailing apps, for example, is a natural extension of any mobility superapp. The most successful superapps, however, are those that map out a person’s daily needs and provide an inescapable convenience for every possible desire. Payments? Check. Content streaming? Check. Movie booking? Check. Grocery delivery? Check. Cab hailing? Check. Tata Neu even offers online shopping through Tata Cliq, and WeChat extends both dating (and divorce!) services to its users. All accessible through one set of login credentials without the necessity of remembering several usernames and passwords – a boon in a world that requires unique logins for every account you create on a website or app.

Data is King

As users generate endless streams of data, this data can help companies build better predictive models of consumer behavior to personalize and localize their offerings, increasing conversion rates. Superapps have built-in opportunities to upsell or cross-sell products to the same customer base, thereby increasing revenue. They take a direct cut of transactions they facilitate on their platform, which is much more lucrative than earning just through ads and subscriptions. In fact, according to NYU Stern Professor of Marketing, Scott Galloway, US superapps are a $10 trillion opportunity waiting to be realized.

Consolidation of Web Properties

For brands that have invested in several verticals, superapps offer an unparalleled opportunity to consolidate all their web properties under one banner. This has been most prevalent in Asia. Reliance Jio, for instance, started as a data provider and branched out into groceries, healthcare, gaming, and entertainment. Its MyJio super app brings together all its businesses. Tata Neu, an ambitious super app rolled out by the 154-year-old Indian conglomerate Tata Group, competes head-on with the Jio and Amazon superapps. It ties together several properties either owned or invested in by the group, covering BigBasket groceries, Starbucks food and beverages, 1mg online pharmacy, luxury brand Cliq, electronics under the Croma brand, as well as a new UPI-enabled payments service called Tata Pay.

The benefit of Tata bringing all these services under one roof is the establishment of a universal loyalty program offering ‘NeuCoins’ with a one-to-one equivalency with the Indian rupee. 51% of smartphone users are more likely to use a brand’s mobile app if they can earn rewards or points. This strategic phasing out of individual rewards across different services to consolidate them into a single loyalty program ultimately benefits consumers who can both earn and use points faster to avail of cashback and benefits.

Ecosystem Vs. Product: Global Differences in Consumer Mindset

Superapps have long enjoyed stupendous dominance in Asia. As a mobile-first region, many of the users in these regions had preferred to use smartphones to access the Internet. As a result, superapps built by renowned brands gained dominant mindshare and became a trusted guide to the treasures of the Internet by offering services astutely designed for local context.

The Western world, however, has a longer history of access to the desktop Internet and may be as product-centric as the East is ecosystem-centric. Western users are wedded to platforms that they have invested in for years. Users that have been online for decades already have favorite websites that have long enjoyed dominance in certain product categories and may be hesitant to switch to an all-in-one marketplace.

In this part of the world, tech platforms with staunch users may add new sticky service categories like healthcare, education, beauty, and fitness, qualifying in theory as superapps but continuing in practice to maintain product-specific apps with shared backend and branding. Alternatively, you may see vertical-specific superapps; for instance, a financial behemoth may build a superapp centralizing all financial services like payments, loans, insurance, etc. (called “embedded finance”) while a booking app may expand to include all kinds of reservations, from flights, hotels, and cabs to movies and travel experiences. There are even superapps creating a universal loyalty program!

Superapps are Here to Stay

No matter the differences in nuance, form, or function, superapps are an evolution of the Internet that we cannot ignore.

Since its inception, the Internet has come full circle – from the ‘website of websites’ look of Yahoo! in the 90s to the meta ‘app of apps’ feel of superapps today. Yahoo! started out as a list of the most exciting websites on the web, a bulletin board that new startups clamored to inhabit. Superapps are similarly a front door to the many walled pockets of the ever-expanding Internet. Both commanded their users’ attention and kept them on-site for as long as possible.

The only differences are in the façade – more advanced tech infrastructure has imbued superapps with a sleek and sophisticated feel compared to the clunky look of yesteryear portals like Yahoo! – and, of course, in the potential for revenue. While Yahoo! and other pioneers of the Internet couldn’t figure out their business model until a much later stage of their journey, superapps are designed to be cash cows. There is no doubt that in the future, superapps will be the engine of the digital economy.

“The core economic principle of the Internet is the arbitrage of your attention,” wrote Scott Galloway, the NYU Professor. Attention is a limited commodity – a currency you can trade for cash. The company that monopolizes your attention will monopolize your dollars – or rupees or yuan, for that matter. Apple’s app store boasts of 2 million apps today but amid so many choices, which apps will be one of nine that consumers launch every day? Superapps that roll up several services into one convenient platform have a greater chance of occupying the precious real estate of your smartphone home screen and are more likely to feature on consumers’ list of daily favorites.

Enabling Superapp Development

Superapp aspirants do not start out life as a marketplace. They usually perfect one service before integrating others. However, most superapps have core services like payment processing and transportation that bind together their myriad offerings. For superapps that do not offer these core functionalities at inception, barriers to entry are high. It is ideal for superapps in that position to form partnerships to weave these services into their infrastructure.

Splyt partners with superapps and those apps seeking to become superapps. Any app aiming to build out a mobility revenue stream can check out the Splyt SDK and Splyt API products built on the foundation of a single contract, streamlined payments, and multilingual customer support. Through integration with its unique network of global mobility providers, Splyt helps superapps retain their customers wherever they travel.