Will India's Super App Race Pick Pace?交流cording to reports, Tata Group plans to launch its digital loyalty platform TataNeu during this IPL season

Capitalizing on the increasing need to address app fatigue among consumers, many conglomerates including Tatas, Reliance, SBI, Bajaj and others like Amazon, Flipkart, Paytm, PhonePe, have been stepping up efforts to launch their own super apps. A super app eliminates the need to download multiple apps for various services.

交流cording to reports, Tata Group plans to launch its digital loyalty platform TataNeu during this Indian Premier League (IPL) season, which started on Saturday. TataNeu is a mobile app that offers many services across categories and brands. The app includes BigBasket, in which Tata Digital has acquired a majority stake, retail chain Croma, TataCLiQ, Tata Play and will also reportedly offer flight ticketing with AirAsia, IHCL, which operates Taj hotel, and food service from Starbucks.

Not only Tata Group, but other conglomerates have also set their eyes on winning the super app race. Last year, Gautam Adani announced his undisclosed investment in Cleartrip, which is an online travel aggregator and is part of the Flipkart group. Reports said that the reason behind the move was to build a super app that can offer multiple services. Paytm also has been a strong contender in the race with multiple offerings.

However, though these talks of a super app have been doing the rounds for a long time, India is yet to get its own super app that is in the league of WeChat and Alipay.

Why The Delay

Despite a seemingly gold rush, there is no solid super app yet primarily because of the competition-intensive nature of many industries. India has multiple local and international players in almost all segments. "One of the reasons for digital transformation led by improving internet and smartphone penetration across the country, breeds well for the emergence of a super app in India. However, the competition-intensive nature of industries such as ride hailing, payments, food delivery, etc, makes it increasingly challenging for a singular app to host services across multiple segments. For instance, WeChat and Alipay have historically operated in regions where barriers to entry for foreign players is high, thus enabling the likes of WeChat and Alipay to scale and dominate the markets they operate in," said Ankur Bansal, co-founder, Blacksoil.

另一个挑战是迎合社会和cultural diversity. "India is fairly diverse as a country with a wide array of cultural nuances and sensibilities, and due to this, each product ends up having a very broad fragmentation in terms of use cases. Today an average app has to customize itself in terms of geography, language etc, and present itself to the user with a specific demographic context. A super app has to do the same things across the context of multiple apps. This significantly increases the complexity of execution and makes it very difficult for a grounds-up super app to succeed in a diverse market like India," said Anurag Ramdasan, partner, 3one4 Capital.

Who Stands a Chance

Paytm was one of the strongest contenders in the race with multiple offerings. Founded in 2010 by Vijay Shekhar Sharma, the services it has built over the years include Paytm Payments Bank, Paytm General Insurance, Paytm Life Insurance, Paytm Entertainment, Paytm mall, among others. However, after the IPO debacle, the focus of the business may shift. "While Paytm has the ability to transform to a super app, at the moment their focus would be on strengthening their core business offering and regaining investor confidence," said Bansal.

Ramdasan believes that IPO is still merely a starting point in the lifecycle of a large company. "Paytm still has a massive distribution which is highly defensible and allows them to launch new products to a massive base of users at a much lower cost than anyone else. How well Paytm is able to leverage this moat in the long term is something we still have to see play out," he said.

Experts feel that Tata's approach has been very interesting in that they are going after very large and proven apps and business models and integrating them back into the app. "So BigBasket has already handled diverse use cases, so has 1mg or cult.fit, this makes it easier to eliminate complexities and overcome the challenges of building for a large population grounds up. Tata also brings a unique brand legacy with a large enough conglomerate that understands many different aspects of India and hence it will be very interesting to see how their super app plays out," added Ramadasan.

The success of these players is expected to largely depend on their ability to attract and retain their userbase through a wide array of services. "The latter in turn will be possible through efficient and steady integration of services in a timely manner. This will entail a significant cash burn so as to maintain and build a significant userbase – i.e. cash is king and the ability to generate burn cash (whether through alternate business segments or equity fundraise from private investors ) will be key," sums up Bansal.