One App To Rule Them All: Rise of the Superapps

Superapps

In recent years, superapps have provided the digital turf for the latest retail battles. What makes a super app so… super?

Apps have offered us games, food delivery, productivity, and music. They have become an integral part of a user’s daily life, and value propositions have become a competitive edge.

By the end of last year, there were 2.2 million apps on the iOS App Store and 2.8 million on the Android Play Store, serving 2.7 billion smartphone users. Overall, more than 200 billion app downloads have been made in the last 5 years.

However, the mobile app industry has evolved into a closed ecosystem of many apps built into one multifunctional superapp that people now use every day. Apps such as WeChat, Grab, Kakao, and Alipay have all developed into the criteria of superapps, turning into a single point of service for multifunctional purposes.

“You can browse the products, make purchases, make payments and complete the whole cycle within [WeChat],” one online seller told the BBC.

Due to their versatility, superapps have cemented their position as daily use apps, ordering food, booking a ride, claiming insurance, purchasing groceries, or booking a movie ticket, all from one app. By having all of these tools available within one single app, consumer-facing tech companies have found a way to both consolidate the app services market, and retain their users within their ecosystems.

What makes a superapp

Superapps act as everyday destinations for users expecting common online services, such as e-commerce, ride-hailing, or payments. This means super apps must have a seamless, integrated, and unified experience.

Superapps should have at least one key function. Having a function which users use every day makes users reliant on and comfortable with the app. Superapps can then build on this core function to offer other solutions. WeChat started with chat, whereas Gojek (now Goto) and Grab started with ride-sharing. All three eventually branched out into other functions, such as payments or search.

Superapps also need to integrate native wallets into the app. Native payment offerings create strong lock-in with the superapp’s ecosystem. In WeChat, for instance, users can pay for movie tickets, a taxi ride, and also pay for groceries, because it acts as a storefront that is built on top of a payments app.

As an executive from what was previously Gojek pointed out, “Once you’re handling money for a user, you can build a castle of services within it.”

How to build a superapp

The first step is to building a superapp is to work on fortifying core services to get user buy-in. For example, WeChat continues to be a popular messaging app, which was what it was built as in the early 2010s before it became a superapp. Gojek focused more on motorcycles, taxis, and delivery. Developing a consistent and loyal user base is an important precedent to horizontal growth of the app.

Partnerships are also important to superapps. Partnership deals with third-party sellers that can offer their services through their app are usually a win-win, because they help to provide additional value to users. WeChat, for instance, offered ride-hailing services to users in Beijing via DiDi in 2014. The number of rides hailed surpassed 100,000 in within nine days.

Another example is Gojek, who used third-party services to unbundle the app. The company spun off massages and house cleaning through Go-Life, and handed over its medicine delivery service Go-Med to healthtech platform Halodoc.

Additionally, having an open API allowing allowing creators to build extension services can further enhance the experience of a superapp. This is most evidently seen in WeChat’s mini programs. Mini programs are little apps that run inside the larger WeChat app.

Whether it’s to pay bills, play games, book a taxi, or schedule a doctor’s appointment, there’s a mini program for it. Mini programs have amassed 400 million daily active users as of 2020, with annual transaction volume from mini programs doubling year-on-year.

Superapps in Asia

There are many superapps in Asia right now. The top super app in Indonesia is Goto, the result of a merger between Gojek and Tokopedia. It includes food delivery, parcel delivery, movie ticketing, grocery delivery, and more. It currently has more than 2 million drivers-partners and is worth over $18 billion, making it one of the biggest apps in the world.

Another popular super app in Asia is Kakao. Kakao is a South Korean messaging app. In 2014, Kakao merged with Daum Communications, and started working towards evolving into a superapp. So far, their services include music streaming, investments, ride-hailing, video games, social networks, and more. In a country of just over 50 million people, 41 million are active monthly Kakao users.

One of the more popular superapps in China is Alipay. Alipay was started as a digital wallet in 2004 by Alibaba founder Jack Ma. Since then, it has evolved its services to include travel, discount coupons, bill payments, mobile phone top-ups, and more. It has over 730 million monthly users and over 1.3 billion total active users.

WeChat is also based in China. It became the biggest standalone mobile app in the world in 2018 and has over 1.24 billion active monthly users. So far, WeChat’s services include gaming, bill payments, ride-hailing, medical appointment booking, and more. WeChat and Alipay apps are so popular in China, it is said that people can survive by only using these 2 apps.

Competition is ramping up in the superapps space. The big question is whether individual apps understand how they will deliver value in a world dominated by superapps, and whether they will have the ability to move quickly enough to respond to this super disruption.

Header Image by Markus Winkler on Unsplash

SHARE THIS STORY

Share on facebook
Share on twitter
Share on linkedin
Share on email
George Lim

RELATED POSTS

Mazing Lee co-founder of Lify Wellness

Life is About Wellness: Lify Wellness

Traditional knowledge and technological innovation combined brought together a revolutionary business model. The health and wellness industry in the Asia Pacific region (APAC) has been

Smart Cities

The Development of Smart Cities in Asia

With the development of the Internet of Things (IoT) and 5G, our cities are becoming faster, more efficient, and smarter. With the advancement of emerging