Super Apps: The Inevitable Future of Integrated Platforms in the Digital Age
Amidst the overwhelming multitude of standalone apps, the emergence of super apps signifies more than a passing trend – as this article aims to argue, it represents a digital imperative with compelling necessity for not just user convenience, but also community building, business development as well as socio-economic inclusitivity.
A key driving force behind this trend is the innovation demonstrated by Chinese tech companies, coupled with the distinctive “mobile-first” digital landscape prevalent in many Asian countries. This has created a fertile ground for the development and adoption of super apps, which are ideally suited to the needs and habits of mobile-centric users.
Launched in 2011 by Chinese tech giant Tencent, WeChat is argubly the most successful super app so far. It is so successful that Elon Musk has previously expressed admiration for the concept of “all-in-one apps” it introduces, and he believes that replicating even a fraction of WeChat’s success with X (formerly known as Twitter) would be a significant achievement. In August, 2023, Musk published a post on X, outlining his plans for the coming months. He further brought up the concept of all-in-one apps, stating that “we will incorporate comprehensive communications and create a platform to manage your entire financial world”. Elsewhere in Asia, superapps such as Singapore-based Grab, South Korea’s Kakao Talk are gaining track, too.
Why do industry observers and forward-thinking innovators like Elon Musk all share the belief in the potential of super apps as future trends?
In WeChat’s case, originally intended to connect people, WeChat evolved into a social networking platform with features like “Moments”. The 2013 launch of WeChat Pay marked its transition into a multi-service ecosystem, integrating third-party services for tasks like ride-hailing and food delivery. The 2017 introduction of Mini Programs, in-app services without separate installations, attracted businesses for marketing and customer engagement.
A crucial aspect of WeChat’s successful evolution into a superapp is the focus on ensuring user experience, a goal shared by other digital giants like Meta. However, while Meta’s WhatsApp prioritizes the number of active users as their approach to achieve this goal, WeChat places greater emphasis on its ability to address the daily needs of its users, making it highly relevant in their lives.
A prime example is We Doctor, an online healthcare platform within WeChat. By offering initial medical services online, it has provided a solution to a problem unique to China – the overburdening of high-level hospitals. The platform leverages WeChat’s massive user base and integrated payment system, extending the super app benefits to healthcare. Unlike other platforms, We Doctor nurtures its ecosystem, allowing public hospital physicians to work as independent contractors and set their own fees. As a result, this approach creates value for both patients and healthcare providers. With nearly 8,000 associated hospitals, 270,000 doctors, and 222 million patients, We Doctor’s success highlights the potential of super apps in various sectors, including healthcare.
From a socio-economic perspective, super apps contribute to digital inclusion and economic growth. By providing a range of services – from communication and entertainment to financial services and transportation – super apps can make digital services more accessible, especially in regions with low digital penetration. This, in turn, can foster digital literacy, promote e-commerce, and stimulate economic activity. For example, WeChat’s Mini Programs feature has been particularly instrumental in enabling small businesses and entrepreneurs to digitalize their operations with minimal cost. These services within WeChat allow businesses to create online stores, manage customer interactions, and conduct transactions, all without the need for developing a standalone app. This ease of access to the digital economy has been vital for grassroots economic development in China. The innovation of QR codes in payment offers another example of WeChat’s enabling SMEs. Home-based businesses and freelance services, such as those selling homemade crafts and freelance clothing designers, have found a wider audience through WeChat. They can showcase their products, take orders, and handle transactions, all within the app.
Similarly in Southeast Asia, the model of super apps has significantly contributed to local economic inclusivity. For instance, Singapore-based Grab started initially with only ride-hailing services, and evolved into an integrated all-in-one platform. Its digital payment service, GrabPay, has made financial transactions more accessible for the unbanked population in the region, enabling them to participate in the digital economy. This is particularly impactful in Southeast Asia, where around 70% of the population is still unbanked.
From a business standpoint, super apps present a unique opportunity to tap into a larger customer base and diversify revenue streams, hence better earning potentials. By offering multiple services, businesses can cross-sell and upsell, ultimately increasing their profits. Beyond just revenue, WeChat also offers unique advantages to businesses. Its development environment allows for cost-effective and quickly deployable Mini Programs, an ideal solution for businesses wanting to launch new ideas swiftly.
Pinduoduo, for example, the NYSE-listed Chinese e-commerce company, has witnessed significant initial growth largely attributable to WeChat.
Pinduoduo offers a unique “group buying” model where users could get discounts by inviting friends to buy the same product. This model was an instant hit due to the social nature of WeChat. The integration within WeChat allowed Pinduoduo to tap into WeChat’s enormous user base, significantly reducing customer acquisition costs. It also enabled Pinduoduo to cross-sell and upsell by offering a wide range of products, from groceries to electronics, all within the same platform.
Furthermore, the Mini Program environment within WeChat allowed Pinduoduo to quickly test and deploy new features, such as the gamified shopping experiences. These features not only drove user engagement but also diversified Pinduoduo‘s revenue streams, as they could earn from advertising and premium services in addition to product sales.
Given the remarkable success of super apps in the East Asian landscape, the prospect of creating a Western counterpart akin to WeChat has sparked intense debate. According to Laura McCracken from The Payment Association, the emergence of super apps in the U.S. and Europe could be on the horizon. This is primarily due to shifting consumer habits, particularly among Gen Z, who are increasingly influenced by influencer culture and are adapting to a social commerce consumption model more common in Eastern markets.
But it’s not just consumers driving this change. Businesses are also adjusting their operations, maintaining a presence on their own e-commerce platforms while also tapping into the potential of marketplaces and social commerce platforms. For example, major airlines are using travel marketplace platforms such as Expedia to broaden their reach and increase traffic, despite having their own booking platforms. Similarly, retail giants like Nike are balancing their presence on their own websites with a presence on platforms like Amazon and Instagram.
This shift in both consumer and business behavior is leading to a consolidation in the market, with an increasing demand for convenience. Consumers are not only looking to make purchases, but also to engage as creators within a more inclusive commerce system. This changing landscape is supported by the presence of reliable digital wallets, secure payment methods, and effective chat capabilities, which enable communication through live streaming.
Observing the current trends, it seems plausible that the concept of super apps could soon take root in America and Europe. The astounding success of super apps like WeChat in China suggests that this model could potentially gain ground in the West as both consumers and businesses increasingly gravitate towards comprehensive platforms that cater to their multifaceted needs.