What we got wrong about superapps
Money20/20 also saw Lucy Ingham, our Editor-in-Chief and Head of Content, share her insights about the potential of superapps in the West to a packed house on Tuesday.
Focusing on the idea that superapps are not well suited to the Western payments landscape, Lucy’s talk addressed how our ideas about the future shape product development – and how this impacted the enthusiasm for superapps that we saw a few years ago. Here are some of the main highlights:
- Superapps, which have risen in Asia over the past decade or so, are a single source for many of life’s day-to-day necessities, providing a walled garden that covers services including instant messaging, ecommerce and payments.
- China’s WeChat is seen as the gold standard for what superapps are and can be, with WeChat Pay alone having an estimated 1.25 billion active users and covering features including gaming and social media. Others include Alipay, which beyond China serves other markets through Alipay+, and Southeast Asia’s Grab, which began as a mobility and delivery app that expanded into payments.
- These superapps worked because they were launched at times and places where they met genuine unmet needs and offered measurable improvements over the existing landscape. Grab, for example, added payments at a time when less than 40% of people in five of its main markets had ever sent or received a digital payment.
- But these large-scale superapps are a poor fit for Western markets as they are now, because they are trying to solve problems that already have well-liked solutions (for example X trying to take on Zelle and Venmo in the US by adding P2P payments). The broad approach of adding services also encourages companies to over-extend their offerings to features where they cannot beat market leaders.
- This dissonance is in part because superapps in the West owe more to science fiction than reality. Fiction has helped shape much of the world’s technology, including in payments, but an over-focus on ideas without full exploration of how they fit reality results in products with poor market fit and limited TAMs. Beyond payments, this is visible in solutions such as virtual reality, which has failed to gain major adoption despite significant investment. In payments, superapps are a strong example of this because it sees companies try and compete without meeting an unresolved user need.
- Instead, the West provides significant opportunities for nuanced, hyper-personal interconnected solutions. Not every company needs to be a payments company and partnerships can be a critical approach instead.
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Lucy is Head of Content & Editor-in-Chief at FXC Intelligence, overseeing all content and taking deep dives into the trends and data driving changes in payments.
Before joining FXC Intelligence, Lucy worked as a technology journalist and editor, interviewing CEOs and major names across enterprise technology, including fintech. She has an MSc in Development Anthropology from Durham University.
