The rise of the super apps: Why should you care?

      Published on Thursday, 20 February , 2020      1360 Views     
The rise of the super apps: Why should you care?

  • Technology

New year, new decade and the world is in a continuous competition with itself to evolve and change faster.

Hence, it is time for businesses to step up rather than just keep up.

Keeping track of Silicon Valley in the West is no longer enough, it is time to broaden our horizon and look East, toward China.

Key innovations such as e-commerce, mobile payments and high-speed trains either started in China or were refined there, and then taken to the rest of the world.

The old image of China as a ‘copycat country’ that stands for cheaper production and weaker consumption is disappearing and it is time we understand how they made it happen.

Most of us use a variety of apps on a daily basis such as Messenger, WhatsApp, Careem, Amazon, Namshi, Deliveroo, Zomato, and any e-commerce operator. Each of these is focusing on offering a specific kind of service or product, some of them maybe offer a thing or two more than their core service. But none of them have developed as far as being a ‘super app’, yet. However, the line between what an industry or sector does singularly has been blurred out extensively.

One-stop portal

Suddenly, the rise of something new happened and one great example is the rise of WeChat. This is the one app that has it all, the 1 billion users app, the ‘super app.’

A super app is there at every point of your daily contact with the world, from morning until night. It is a one-stop portal where users can access an extensive number of third-party services like hailing a cab, buying a movie ticket, ordering food online, paying utility bills, or sending money to friends. One app, one sign-in, and one user experience – for virtually any product or service a customer may want or need.

Going back to the prominent example of WeChat, this app was initially positioning itself as an instant messaging app, just like WhatsApp.

Today, it goes beyond just social networking. Having 9 out of 10 active users daily, WeChat is used by 70% of the population and quickly became China’s super app. Why? Because WeChat does not hesitate to test features that are outside its core messenger function. With this vertical growth strategy, WeChat has created a complete ecosystem with a strong lock-in effect.

If we look at revenue streams, only 17% come from advertising compared with Facebook which has 89% of its revenue from advertising.

We can learn from a fearless and experimental player who is quick at developing prototypes, testing new features and letting users determine its success. Reality is, these super apps have the potential to up-end trends in the banking sector. So, what should banks think of to stay up-to-date with this Eastern phenomenal?

  • Build strong partnerships and ecosystems

The rise of super apps is an important indicator that we are giving way to a consumer-driven world. As a bank, your value will be measured based on the value of your ecosystem. Who are your partners? What kind of services are you providing? How do you make my life, as a consumer, more convenient? But, keep in mind that you cannot do it alone. You need to update your overzealous rise and security capabilities.

  • Use data to deliver better personalized services

Having great consumer data and knowing what it means are two very different things. Banks will need to rethink their investments into improving both their data management and their analytics capabilities, and do that away from the product silos, if they hope to compete on the same level as super apps. Much of the success of super apps is predicated on the fact that they are able to share data across various service areas to understand their consumer better. Banks will need to consider how they can use APIs to emulate the rich data flows and better target their customers.

  • Rethink your monetization strategy

In the race to attract new consumers, banks are often overlooking the goldmine in their own hands, their existing customer base! That is your biggest asset, not your balance sheet. As a bank, it is time to shift from processing fees to monetizing based on the customer base you already have. While new customer acquisition is crucial for most strategies, the valuable opportunities one could get from reselling to existing ones is underestimated. This is the refreshingly captive audience.

  • Decide your super app evolution

Being a bank, sometimes regulations and restrictions are beyond ones control, but it does not mean that partaking in the rise of the super apps is not possible. People have their own interpretation of what the regulations are, but it does not make them right. Dare to break the perception of what you are not supposed to do, and figure out what you can actually do. Moreover, if a bank is unable to build a super app of their own, they can plan to be a front-office player within another super app, or a back-office enabler, or simply a piece of regulated infrastructure in the future.

Jayesh Patel is head of Liv. digital bank

Category Technology | 2020/02/20 latest update at 12:13 PM
Source : Arabian Business | Photocredit : Google
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