The Impact Of Superapps On Traditional Businesses

According to Gartner, a superapp, super app or super-app is an application that provides end users (customers, partners or employees) with a set of core features plus access to independently created mini apps. The superapp is built as a platform to deliver a mini apps ecosystem that users can choose from to activate for consistent and personalized app experiences. Nowadays, superapps are trending because users, especially the younger generation born in the age of smartphones, demand mobile-first experiences that are powerful and easy to use. In this article, you will get a deeper understanding about how superapps are disrupting traditional businesses and industries, and why businesses must adapt to stay competitive.

1. The rise of superapps

1.1. Businesses adopting superapps

The growth of superapps in emerging markets has been nothing short of remarkable. Superapps first emerged in China with the rise of WeChat, which started as a messaging app but quickly grew into a multifaceted platform that offers a wide range of services, including e-commerce, ride-hailing, and digital payments. Since then, superapps have become increasingly popular in other emerging markets, such as Southeast Asia and India. In Southeast Asia, Grab and Gojek are two of the most popular superapps, offering everything from ride-hailing and food delivery to financial services and shopping. In India, Paytm and Jio are leading the way with their wide range of services, including digital payments, e-commerce, and entertainment.

The popularity of superapps in emerging markets can be attributed to a number of factors. For one, many people in these markets do not have access to traditional banking and financial services, making superapps a convenient and accessible alternative. Additionally, the all-in-one nature of superapps makes them appealing to consumers who prefer to use a single app for multiple services rather than juggling multiple apps. The growth of superapps in emerging markets has not gone unnoticed by tech giants such as Google and Facebook, who are now exploring ways to launch their own superapps in these markets. However, the competition is fierce, and traditional businesses in these markets are also fighting back by adapting to the rise of superapps and integrating digital services into their offerings.

1.2. Comparison: Superapps vs. Traditional apps

Superapps differ from traditional apps and app marketplaces in several key ways:

• All-in-one functionality: Superapps offer a wide range of services and features, all within a single app. For example, a superapp might include ride-hailing, food delivery, e-commerce, and financial services, all accessible from the same app. This is in contrast to traditional apps, which typically focus on a single service or product.

• Seamless integration: Superapps seamlessly integrate different services and features, providing a cohesive user experience. For example, a user might be able to order food delivery and pay for it through the same app, without having to switch between different apps or services.
• Personalization: Superapps use advanced algorithms and machine learning to personalize the user experience, providing tailored recommendations and services based on user preferences and behavior. This is in contrast to traditional apps, which may offer limited personalization options.
• Digital payments: Superapps often include digital payment options, allowing users to pay for services and products directly through the app. This is in contrast to traditional apps and app marketplaces, which may require users to go through a separate payment process.
• Social networking: Some superapps, such as WeChat, include social networking features, allowing users to connect with friends and family, share content, and interact with businesses and brands.

Overall, superapps provide a more comprehensive and convenient user experience than traditional apps and app marketplaces, with a wide range of services and features accessible from a single app. This has contributed to their growing popularity in emerging markets and beyond.

1.3. Benefits of using a superapp

Using a superapp offers plenty of benefits to users, including:

• Convenience: Superapps provide a one-stop-shop for a wide range of services and features, such as ride-hailing, food delivery, e-commerce, and financial services. This eliminates the need for users to switch between different apps or services, making their lives more convenient.
• Cost savings: Superapps often offer discounts and promotions for using multiple services within the app. For example, a user might get a discount for ordering food delivery and a ride through the same app. This can lead to significant cost savings over time.
• Personalization: Superapps use advanced algorithms and machine learning to personalize the user experience, providing tailored recommendations and services based on user preferences and behavior. This can make the app feel more personalized and relevant to the user’s needs.
• Digital payments: Superapps often include digital payment options, allowing users to pay for services and products directly through the app. This can be more convenient and secure than traditional payment methods.
• Social networking: Superapps like WeChat have incorporated social media capabilities, which enables users to interact with friends and family, share content, and engage with businesses and brands.

In general, using a superapp can make users’ lives more convenient, save them money, and provide personalized recommendations and services.

2. How superapps are impacting traditional businesses

2.1. How superapps are disrupting traditional businesses and industries

Superapps are disrupting traditional businesses and industries in numerous ways, transforming the way people interact with these sectors. Here’s a look at how superapps are changing the game in some of the most significant industries:

• Retail: Superapps are transforming the retail industry by offering a wide range of products and services through a single app, making it more convenient for users to shop. Users can browse and purchase products within the app, and often benefit from personalized recommendations and discounts. This is threatening traditional retailers who are struggling to compete with the convenience and cost savings offered by superapps.
• Finance: Superapps are also transforming the financial industry by offering a range of financial services, such as digital payments, loans, and investments, through a single app. This is challenging traditional banks and financial institutions, which are struggling to keep up with the pace of innovation and the changing needs of consumers.
• Transportation: Superapps are also disrupting the transportation industry by offering ride-hailing services through their apps. This is threatening traditional taxi companies, which are struggling to compete with the convenience and low cost of ride-hailing services offered by superapps.

As you can see, superapps are challenging traditional businesses and industries by providing a more convenient, personalized, and cost-effective user experience. This is forcing traditional businesses to adapt and innovate in order to stay competitive. In some cases, traditional businesses are partnering with superapps to offer their services within the app, while in other cases they are developing their own superapps to compete. As superapps continue to evolve and expand, their impact on traditional businesses and industries is likely to grow even stronger.

2.2. How traditional businesses are adapting to the rise of superapps

Traditional businesses are adapting to the rise of superapps in a variety of ways in order to remain relevant and competitive. Here are some examples of how they are adapting:

• Offering services through superapps: Some traditional businesses are partnering with superapps to offer their services within the app. For instance, retail businesses may offer their products through e-commerce platforms within a superapp, while traditional taxi companies may partner with ride-hailing superapps to offer their services through the app.
• Developing their own superapps: Some traditional businesses are developing their own superapps to compete with existing ones. For example, banks may develop their own apps that offer a range of financial services, while retailers may create their own e-commerce apps that provide personalized recommendations and discounts.

• Emphasizing customer experience: Traditional businesses are focusing on improving the customer experience to compete with superapps. They are investing in technologies such as artificial intelligence and machine learning to personalize the user experience, as well as improving their digital payment options and delivery services.
• Focusing on niche markets: Some traditional businesses are focusing on niche markets that are not yet served by superapps. In the market, local specialty stores and artisanal products may still find a niche market despite the convenience of superapps.

Traditional businesses are recognizing the importance of adapting to the rise of superapps in order to remain competitive. By offering their services through superapps, developing their own apps, focusing on customer experience, and targeting niche markets, they can continue to thrive despite the disruption caused by superapps.

2.3. The challenges traditional businesses face in competing with superapps

Traditional businesses face several challenges in competing with superapps:

• Limited customer data: Superapps have access to vast amounts of user data, which they can use to provide personalized recommendations and offers. Traditional businesses may not have the same level of access to customer data, making it difficult to compete on the same level.
• High costs: Developing and maintaining an app that offers the same level of convenience and functionality as a superapp can be costly for traditional businesses, particularly for small and medium-sized enterprises. This can make it difficult for them to compete with larger, more established superapps.
• Speed of innovation: Superapps have the advantage of being able to innovate quickly and respond to changing customer needs. Traditional businesses may struggle to keep up with the pace of innovation, particularly if they have a rigid organizational structure or are resistant to change.
• Brand recognition: Superapps are often well-established and have a high level of brand recognition. Traditional businesses may struggle to build the same level of brand recognition, particularly if they are entering a market where a superapp already dominates.
• User habits: Superapps have become deeply ingrained in the daily lives of many people, particularly in emerging markets. Changing user habits can be challenging, making it difficult for traditional businesses to attract and retain customers who are already using superapps.

3. The potential privacy concerns of superapps

The rise of superapps has raised concerns about user privacy, particularly in the context of data collection and sharing. Here are some potential privacy concerns associated with using superapps:

• Collection of personal data: Superapps often collect a significant amount of user data, including personal information, location data, and browsing history. This data can be used for targeted advertising and personalized recommendations, but it also raises concerns about privacy.
• Third-party access: Some superapps may share user data with third-party advertisers or partners. This can result in users’ personal information being accessed by unknown parties, raising concerns about data security and privacy.
• Lack of transparency: Superapps may not be transparent about their data collection practices, making it difficult for users to understand what data is being collected and how it is being used. This lack of transparency can erode user trust and raise concerns about data privacy.
• Risk of data breaches: Superapps can be vulnerable to data breaches, particularly if they collect and store large amounts of user data. A data breach can result in sensitive user data being compromised, including personal information and financial data.
• Government surveillance: In some countries, superapps may be subject to government surveillance or censorship. This can raise concerns about user privacy and freedom of expression.

The potential privacy concerns associated with using superapps are significant. Users should be aware of the data collection and sharing practices of the apps they use, and take steps to protect their privacy, such as using strong passwords and limiting the amount of personal information they share. Additionally, companies that develop and operate superapps should be transparent about their data collection practices and take steps to ensure the security of user data.

4. The future of superapps

The future of superapps looks bright, with many experts predicting that they will continue to grow in popularity and influence in the coming years. Superapps are already popular in emerging markets such as China and Southeast Asia, but they may also gain traction in other regions, expanding into new markets,  including Europe and North America. Moreover, superapps may integrate with emerging technologies such as blockchain and augmented reality to provide even more value to users. Superapps will likely continue to prioritize user experience and convenience, offering new features and services that make life easier for their users. As the popularity of superapps grows, competition among them is likely to increase, with new entrants seeking to challenge established players. Besides the challenges that traditional businesses have to face when superapps become more and more popular, superapps may partner with traditional businesses to offer new services and reach new customers. As privacy concerns continue to be a major issue, superapps may invest more in privacy and security measures to ensure the safety and security of user data. Overall, the future of superapps is likely to be shaped by a combination of technological advancements, market trends, and user demand. As they continue to grow in popularity, superapps have the potential to transform the way we live, work, and interact with each other.

5. Conclusion

Gartner expects that by 2027, more than 50% of the global population will be daily active users of multiple superapps. The superapp concept will also expand to include enterprise mobile and desktop experiences, such as workflow, collaboration and messaging platforms.

Kyanon Digital is a leading technology company based in Vietnam, offering world-class digital solutions with an agile approach. With years of experience in consulting and accelerating digital transformation, our experts are always ready to help clients achieve their digital transformation goals and drive growth. Contact us for more information about superapps and technology consulting.