Across ASEAN, the race to consolidate the entire consumer journey into a single digital platform is well underway, inspired by China’s super app success stories. Leading companies are vying to become the one definitive platform in their own market, and Thailand is no exception. The term super app, coined by Blackberry founder Mike Lazaridis in 2010 at the Mobile World Congress, refers to a one-stop digital platform that offers diverse services – such as food delivery, financial services, commerce, ride hailing, messaging, or utilities – all under a single roof.
The global super app market size was valued at US$61.30 billion in 2022, according to a report by marketing and consulting firm Grand View Research, and is projected to expand at a CAGR of 28% between 2023 and 2030 backed by continued growth in internet and smartphone penetration, cheap data and rising ecommerce and digital payment adoption.
Super apps have been especially prevalent in Asia Pacific, a region with 4.3 billion people, about 60% of the world’s population. Going forward, APAC is expected to grow fastest, due to a huge unbanked and underbanked population and prominent super app players providing access to new financial and digital services to hook them into their ecosystems.
The best exponents of a super app are Tencent’s WeChat and Alibaba’s Alipay in China, where the super app phenomenon first started. WeChat – which has over 1.3 billion monthly active users – was one of the first global super apps, providing everything from ride hailing and food delivery, to purchasing medical services, insurance or parking. China’s Alipay is another dominant super app, alongside Singapore’s Grab, Indonesia’s Gojek, and South Korea’s Kakao Talk.
Thailand: the next battleground for super apps
A few international players are already operating cross-category services in Thailand. Since Grab launched in Thailand in 2014, it has become a top player in several popular verticals, including ride hailing, food delivery and messenger services. However, if you open your Grab app in Indonesia you’ll see the breadth of services offered in Thailand is still some way behind.
In 2021 Singapore’s Shopee expanded beyond its core offering to launch food delivery in Thailand. The ecommerce giant also offers online payment services under ShopeePay and has further plans for super app expansion. Among others in the race include Indonesia’s Traveloka, providing a range of services centred around the travel industry.
In terms of local players, Line Man and Robinhood both successfully penetrated multiple categories of on-demand services, but the latter is ceasing operations from July 2024. Others have become super apps within their respective verticals, with TrueMoney transforming from a digital wallet into a comprehensive financial super app, and 7-Eleven dominating in commerce, including online-to-offline retail, ecommerce, financial services, campaigns and entertainment. Unlike some of its neighbours, Thailand is yet to have a homegrown super app that transcends all verticals.
7 critical factors for super app success
Making the transition from success in one sector to becoming a daily-use lifestyle app is no easy feat. Many popular apps bolt-on lifestyle-oriented content but adoption remains limited beyond their core use cases. Super app success is hard to attain, but the following factors can increase a company’s odds.
- Dominant core offering. When today’s super apps first launched in China, there were underserved consumer needs across numerous verticals. This enabled these fast-movers to obtain a critical mass of users for their core offering (eg. messaging, payments) before quickly expanding to new services that leverage that core. Building a brand new, all-encompassing super app in today’s mature digital market would be nigh-on impossible. However for Thai businesses already dominant in one sector, expanding to adjacent services underpinned by their core offering is very much achievable.
- High-frequency service. One commonality across all super apps is their ‘hook and expand’ strategy: acquiring users with low-cost high-frequency services, before cross-promoting lower-frequency higher-margin offerings. China’s Meituan rapidly scaled through food-delivery, a core offering that was initially unprofitable but paved the way for its expansion to over 200 services. Thai applications that have already built daily-use habits are well-positioned to keep expanding, increasing value for their users and their businesses.
- Clear focus. Aspiring super apps should first align on their definition of this broadly-used term, then outline a clear vision of what it means to their business. Going deep to become the definitive super app in a particular vertical may be more fruitful than going broad. During covid, AirAsia pivoted to become a digital lifestyle company; it rebranded as the AirAsia Superapp and acquired Gojek’s Thailand business to power its local operations. Last year however the company reeled in its ambitions of becoming an all-encompassing super app, rebranding to AirAsia Move to double-down on what it does best – travel.
- Consumer trust. Trust is a big factor for aspiring super apps to win-over consumers. A consumer survey by PYMNTS found the number one concern of using super apps is data security, and the most important factors in creating trust are their ability to keep data secure, as well as the company’s overall reputation. Therefore genuine super app contenders in Thailand will be companies you already know, and likely platforms you already use and trust.
- Partner ecosystem. While a minority of super apps operate all services in-house (eg. Grab), most Chinese super apps focus on their core offerings and platforms, with a plethora of expanded services provided through third-party integrations. Super app operators determine how ‘open’ their ecosystem should be (hand-selected partners Vs open to all) but either way it’s this platform-play that fuels exponential service growth. Most super app contenders in Thailand are currently expanding through consolidation of first-party group offerings. This is a good first step, but eventually opening out ecosystems to trusted partners will accelerate growth further.
- Mini-App Governance. Gartner’s definition of a super app is “an application that provides end users with a set of core features plus access to independently created miniapps”. So if you’re growing through partnerships, effective mini-app governance is critical. This includes integration and approval processes, and how data is shared both ways. Mini-app governance is a trade-off between control and flexibility, so before coding anything, you need to align on your company’s preferred operating model and technical architecture to support that.
- Robust technology. Defining a clear super app vision is one thing, but there’s great complexity in making it a reality. Tech to govern third party integrations. Scalability to serve millions of users. Security to protect the abundant data generated. AI to leverage this and cross-promote the next best action. As they say, knowledge is power, and data is central to why these far-reaching apps are so successful. The more customers do in a single app, the more the platform knows them, enabling highly-personalised experiences that better serve their needs than narrowly focused competitors. Aspiring super apps need the right technology to make this possible.
The road ahead
There are a few companies in Thailand that are well-positioned to cash in on the super app gold rush, but there’s no shortcut to success; building a super app is a long-term play. We also can’t assume that what has worked in one market can instantly drive success in another. Every market has unique characteristics and therefore requires a tailored go-to-market strategy in order to scale. A deep understanding of the local market, customer preferences and the right potential partners are all key to success.
Genuine super app contenders will already have a strong market position, and need to think innovatively how to leverage this for growth. How can our existing assets power new offerings in novel ways? What partnerships could help us launch and validate new service lines rapidly? How can our existing data create better tailored experiences than competitors? What’s our unfair advantage to succeed where niche players can’t? With the right super app strategy, the opportunity is there for the taking.
