It’s 2021, and super apps are becoming a trend in consumer tech. With China’s WeChat and AliPay setting the standard for super apps, other businesses from the East to West (including Malaysia) are quickly catching on and riding the wave.
The future of super apps has been heavily discussed around the world. In a talk given by Connie Chan (General Partner, Andreessen Horowitz) in 2020, Chan predicts that “everything will become a super app”, where companies will start working together to discover new revenue streams. She also foresees that “everything will become commerce”; that we will be shopping from most of the apps that we use. This was a bold prediction, and one year later, it seems to be (very evidently) ringing true.
China started small with Meituan, a food delivery app with which users can also find discount deals, share bikes and make hotel bookings. In the years following 2011, tech giant Tencent began making a huge impact on China and shortly after the rest of the world with WeChat, which has since then expanded far beyond just instant messaging with over a million mini programs.
This super app trend then penetrated the West with apps like Uber, and SouthEast Asia with the launch of Grab and Gojek. This, of course, is just the tip of the iceberg.
What’s a Super App Anyway?
Super apps are basically apps with aggregated services or functions. As opposed to single-purpose apps like Snapchat (for sharing disappearing photos and videos) and Skype (for video calling), super apps offer a unified and centralized experience and use aggregate data for multiple functions in a single platform.
Some of the most recognized examples of super apps are WeChat, AliPay, and even Google Maps where you can navigate, book hotels and flights, hail rides, and make restaurant reservations all in one place.
How did the term “super apps” come about?
In a talk at Mobile World Congress 2010, the concept of super apps was introduced by RIM’s then co-CEO Mike Lazaridis as “integrated with other apps, giving a seamless experience across the device. They’re contextual — aware of things like your location and status”. Today, the term is used far and wide, and has extended in essence beyond this definition.
On the Gojek Tech official site, super apps are defined as “many apps within an umbrella app”, “an operating system that unbundles the tyranny of apps” and “a portal to the internet for a mobile-first generation”. Meanwhile, KPMG describes them as “a single portal to a wide range of virtual products and services. One app, one sign-in, one user experience — for virtually any product or service a customer may want or need.”
The Good that Super Apps Bring
Super apps are great because of their value proposition. Needless to say, there are many reasons for the success that super apps have rapidly garnered over the years. When a vendor and a super app integrate their services, patrons of a vendor gain the combined value of both the vendor and the app.
But there’s much more to it. Why else are super apps doing so well, and why do people love them? Here’s a simplified breakdown of the benefits that super apps bring…
To the Consumer
- Low storage usage — Device storage is limited, and hence people are precious with it. Super apps solve this. With apps that centralize multiple functions and services, users are able to enjoy multiple new services without downloading additional apps.
- Saves time — The convenience of only having to share customer data on one single platform to have access to multiple functionalities and services is an attraction. Especially if the app supports e-wallet payments, transactions can be quick and seamless.
To the Facilitator (Super App)
- Potential for high revenue — In return for providing vendors a platform or marketplace where tools such as authentication, payment, messaging or tech support systems and marketing resources are available to help them succeed, super apps can potentially generate a high volume of revenue from fees and commissions.
To the Vendor
- Low maintenance cost — Because the architecture/environment is managed by the facilitator (super app), vendors don’t need to build a super app themselves or spend much on maintenance. Rather than worrying about technology integration, they can simply focus on joining the ecosystem and using the existing tools provided for their services.
- Centralized customer data — Due to data being centralized on super apps, vendors and marketers are able to micro-target their audiences with more personalized customer data and insights.
- Widespread audience — The user base for super apps cover a wide range of verticals because of the way they function as a general purpose tool. Rather than a specific segment of the market, their audiences are often massively diverse, which creates an array of marketing and sales opportunities for vendors.
- High user retention — Simply because super apps are capable of offering much more than standalone apps, users are bound to come back for its convenience.
Southeast Asia: A Growing Market
With the momentum it’s picked up from the East, the super app wave didn’t take long to reach Southeast Asia. Here are the current frontrunners in the ASEAN super app race.
A sure mention, Grab is well known as Southeast Asia’s number one one-stop-solution for ride-hailing, food delivery, cashless payments, ticket booking and even trip planning.
What started out as a simple taxi-booking app in 2012 has expanded into a must-have super app that offers the combined convenience of an e-wallet, benefits and reward system, and even same-day deliveries for food and groceries.
As of yet, Grab operates in 8 countries including the Philippines, Thailand, Singapore, Malaysia, Cambodia, Indonesia, Vietnam and Japan. With over 187 million users, this groundbreaking app was awarded the title “Southeast Asia’s super app” on 2020 CNBC Disruptor 50.
Gojek started off in 2010 with 20 motorbike drivers. Today, the Indonesian ride-sharing service stands as the biggest regional competitor to Grab with over two million drivers and a growing list of on-demand services including transportation, food delivery, courier and payment.
Ranked No. 10 on 2020 CNBC Disruptor 50, Gojek’s unique on-call beauty, medical, housekeeping and massage services distinguish it from its competitors. With over 170 million users and 500k food merchants today, Gojek is quickly rising to become one of the most impressionable super apps internationally.
AirAsia describes their app as “the Asean super app for everyone”. The recently evolved super app now offers a variety of services like flight booking, food and grocery delivery, hotel booking, as well as points and reward privileges.
With over 16 million users across a handful of ASEAN countries, although not as big as Grab and Gojek based on numbers alone, the AirAsia app might be a lone wolf in the super app market because of the unique ecosystem that they’re cultivating for their users.
What does that mean? Because AirAsia’s business is so diverse, the vendor services they accommodate like BigPay, BIG Xchange and Tune Protect are companies that they own. This ‘AirAsia ecosystem’ that they are forming sets them apart from the other super apps and might also mean better chances of user retention in the long run.
4. Touch ‘n Go
The direction that the Touch ‘n Go app is headed is looking a lot like the super app route. Users are now able to check card balances, pay for parking tickets and bills, buy mobile prepaid top-ups, book movie tickets and flights, as well as order food on the app via third party services.
One of the reasons the Touch ‘n Go app is expected to grow in the coming years is because SME owners or individual traders can easily register as a merchant on the app to widen their customer base.
More importantly, according to group chief executive officer Effendy Shahul Hamid on The Star, users will soon have the option to purchase Touch ‘n Go cards that can be “reloaded directly from their phones using the Touch ‘n Go eWallet” by the end of 2021. This added function might usher in a large batch of new and long term users.
The Future of Super Apps in Malaysia
Ever since WeChat began to gain popularity here circa 2013, Malaysia’s adoption of super apps has been quick and effortless. By the time Grab began to expand along a couple years later, the majority of Malaysians had warmed up to the idea of multifunctional apps as a powerful business proposition.
With that being said, where can we expect Malaysia to be with super apps in the years to come? Here’s a hint: It’s already happening.
According to Communications and Multimedia Minister Datuk Saifuddin Abdullah on MalayMail, MySejahtera is looking to expand beyond its current function of contact tracing to providing “various services under one platform”.
Currently used by up to 25 million Malaysians, an expansion with various services including digital health, education, e-commerce, delivery and financial aid would be able to serve a wide local audience.
Originally created as Selangor’s COVID-19 Initiative app, SELangkah is also beginning to explore different functions.
According to SELangkah’s official website, aside from planning to expand the app to trace Tuberculosis (TB) and dengue outbreaks, the Selangor government has added a Cashless Transaction Facility for SMEs and micro traders to the app as part of their economic recovery efforts. Users who sign up as a merchant at SELangkah Biz can now receive and send payments from any e-wallet provider.
SELangkah Pay and SELangkah Wallet are also in the making to enable cashless payments and government aid.
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