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Tata Digital is All Set to Launch a Super App in 2022
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Tata has assigned 700k employees to test the super app called "Tata Digital's Super App," equipped with cashback offers, hotel booking, grocery, flights, medicines, and a lot more.

A year and a month ago, Tata officially announced its plans to launch a super app. And the inspiration didn’t come from the west but from our neighbor China (1). 

Tata is not alone; other rivals, including Reliance, Amazon, Paytm, and even Adami Group, have elaborate plans of launching their own super apps. In addition, a cohort of startups is eagerly anticipating their launches to expand their customer bases at the lowest possible acquisition cost (2). 

Nonetheless, it is safe to say that supper apps have become the flavor of the decade for India. 

The motive of these companies with their super app is to upsell and cross-sell their offerings and keep the users hooked on the platform. If everything goes well, India can expect to see its first super app by next year.

Read Also: Tata Group to launch its Superapp: Raises Competition for Jio, Amazon, Paytm, Flipkart

Super App: A History

Incepted in 2011, WeChat created ecommerce, logistics, payments, and a lot more on its platform. Its concept of mini-programs brought over 1k apps within the WeChat app.

It allowed companies and developers to reduce their customer acquisition costs by joining WeChat via mini-programs (3). By 2019, WeChat landed more than 230 million such mini-programs. These mini-programs are apps built by third parties within the WeChat application (4). 

While Chinese consumers didn’t have the inherent liking of a layered all-in-one platform, by December 2020, there were more than a billion active users in China. 

Another example is Gojek, a super app based in Indonesia. Gojek started as a ride-sharing platform, which eventually expanded into more than 18 verticals, including ticket booking, courier services, food delivery, etc. The company could come up with such a platform because all the services it offered were interlinked under the umbrella of “on-demand” and “location-based services.” 

Of course, everyone wants to mirror their success, and what market in the world is better than India to profit off a super app. It won’t come without enormous challenges, but first, let’s talk about Tata’s plan to create its all-in-one platform. 

Read Also: Paytm Paving into a Super App, Expand its Service Offering

 

Tata’s Super App Vision

Innovation is why the Tata Group has been thriving globally for more than 150 years. 

The idea of constant reinvention and innovation is a key ingredient for success, and the conglomerate knows it well, especially when it is about the digital future. 

A few months back, reports emerged that Tata Digital seeks investors worldwide to secure over 2.5 billion USD. As per the rumors, Tata aims to bring in strategic and financial investors from tech companies worldwide to compete with its counterparts like Jio and Amazon. According to an Economic Times India (5) report, Walmart-owned Flipkart may invest 20 to 25 billion USD for the said super app hosted under Tata Digital. 

The app, which was previously planned to launch in December 2020, combines a cohort of services including lifestyle, grocery, electronics, healthcare, and even finance under a single “omnichannel” platform. 

Notably, for each segment within this platform, Tata Group is either choosing to build or acquire. And recently, Tata has made numerous acquisitions and developments. 

“Tata has not only built companies, but it has also built Modern India.”

Notably, Tata has invested in more than 25 companies over the past decade, including Abra, XiaomiCureFitOlaPaytm, LenskartFirstCryZivameCashKaro, and Snapdeal (6).

Reportedly, Tata also had a Walmart problem. It didn’t have enough data to personalize and change shoppers’ experiences, unlike its prominent competitor Amazon, which started as an internet-first company. 

To overcome this issue, in 2019, N Chandrasekaran, the Chairperson of the Tata Group (7), reorganized its 30 listed companies and over 1k subsidiaries within ten verticals. IT, Automotive, Steel, Infrastructure, Consumer and Retail, FS, Tourism and Travel, Aerospace and Defence, Trading and Investment, and Telecom and Media.

tata digital super app

He called the reorganization a 3S Strategy:

  • Simplify
  • Synergise
  • Scale

The cornerstone of the reorganization is the conception of Tata Digital. 

Tata Digital’s appointment of Pratik Pal as CEO (8) marked the start of building synergies across different entities of Tata Sons. All in all, Tata Digital aimed at making its products enrich consumer experiences while leveraging its huge distribution (9).

While the company embarked on the journey to build something to fulfill the requirements of Indian businesses and consumers, it struggled at pinpointing a place to begin.

Throughout its history, Tata has been known for its decentralized ways of working. However, suddenly, its boon became a bane. While the strategy allowed new businesses with their leaders, it also led to a loss of control. 

It had to find a way to create an ecommerce platform with its brick-and-mortar brands like Croma, Tanishq, Titan, and Westside, who had massive offline distribution but limited presence online. Enters Tata CLiQ (10). 

Tata CLiQ, with the Q mirroring a magnifying glass, represents the brand’s focus on only the best products and brands for consumers with impeccable taste. It seems like despite noticing only a fraction of ecommerce penetration and growth so far, Tata is not going to give up easily. It pivoted from being a marketplace to becoming a direct seller with its own inventory in 2020. 

How could it? Tata is known to reinvent and innovate throughout its history. In addition, unlike its foreign counterparts, Tata is not tied to complex ecommerce and FDI regulations. 

In January 2021, ahead of its super app launch update, Tata CLiQ received over 3500 crore INR, 20x more of what it received in 2019 (1112). With aggressive targets, Tata CLIQ is getting into the position of being an “omnichannel multibrand retail player” in India. 

Tata is serious with its digital game and set its aim on creating a super app. 

Read Also: Tata Motors: The Avant-gardist of India’s EV Journey

Read Also: From Super App to 5G; Reliance Jio Set to Give Sleepless Nights to its Rivals?

 

Tata Group is Making its Move Fast

The Tata Group, worth over 106 billion USD, ramped up its super app plans by adding a cohort of new categories like groceries, fashion, electronics, beauty, lifestyle, travel, education, health, and entertainment over the past few years. 

According to N Chandrasekaran, the company will add the categories in a sequence and not one go (13). According to a Business Today report, Tata group purchased a controlling stake in India’s most prominent online grocery firm BigBasket and e-pharmacy chain 1mg to realize its e-commerce play ambitions. 

“Each of our companies and brands offers services to more than 20 million customers. We are attempting to give customers the offerings they require. Not necessarily only in-house brands of Tata but a lot more. It is an open architecture with a strong loyalty program, financial products, payment engines, and other categories,” said the Chairperson of the Tata Group. 

According to Chandrasekaran, Tata Digital is planning to bundle the groups’ companies and subsidiaries to simplify the lives of its consumers via the super app.

At that time, he further added, “Tata group has a huge number of consumers who love the brand and wish to do business with the group. However, we still need to make offers that meet their needs and simplify their lives. The best way to achieve is to create a digitally connected enterprise, with the potential to bring together all our services, products, and solutions that fulfill our consumers’ needs so we can give our consumers what they demand, desire, and deserve.”

“We are moving quite fast when it comes to creating and acquiring new businesses in the past ten months amid coronavirus pandemic,” stated the Chairperson. 

Notably, after acquiring healthcare, pharma, and grocery, there are speculations that Tata Digital is acquiring a major stake in Dunzo, a hyperlocal delivery platform. Reportedly, Tata can be more horizontal by onboarding Dunzo (14).

There are also reports that Tata Digital is adding a huge array of fintech services such as credit, insurance, mutual funds under its neobank vertical (1516). 

“Tata has recognized the importance of the digital market. Even though they may be the late entrants, Tata can quickly catch up with some strategic and key acquisitions. While there is already a massive consolidation around JioMart, Amazon, and Flipkart, the Tata Group wishes to make certain that they have a play in this increasingly growing space with the potential to dominate over time,” said Lloyd Mathias, an angel investor and business strategist (17). 

However, the competition will be stiff as all giant players like JioMart and Amazon are venturing into a super app. In addition, even if it is Tata, or anyone else, the road to creating a super app in India won’t be easy.

Read Also: Top 10 inspirational quotes by Ratan Tata

 

Challenges of Creating a Super App in India

Unlike WeChat, China, where major players like Google and Facebook are banned, the Indian market is open. Unlike Gojek, Indonesia, each vertical in India has highly diverse needs. Moreover, thanks to its startup boom, Indian customers already have specialized apps for services they need. It means, unless there are strong incentives to turn to any super app, the idea is merely a pipe dream. 

Because of the lack of market pull, unit economics, and an inability to cater to such diverse requirements, it is quite challenging to create a successful super app in India.

Luckily for Tata, it has built distribution across almost every imaginable vertical. It also gives Tata an understanding of various supply chains. Tata has been building software since the early 1970s, which also gives it a technical prowess to make everything digital. 

All that is left for Tata to do is effectively bundle its massive distribution, technical know-how, and deep expertise into a single super platform. 

However, what we found worrying is Tata’s history of failing to find success in its highly technical endeavors. It is not easy to build a tech giant. In addition, even some of the most talented people worldwide have failed to try to create a super app. Plus, the competition Tata will face in this space is incredibly intense. 

Yes, we believe Tata can ace it with its innovative culture, its habit of offering autonomy, and its stupendous distributions.

Read Also: How Tata Group drove into the e-commerce world with Tata CLiQ

 

The New Ecommerce Rules

Earlier this month, reports emerged that Tata is dragging its feet on the launch of its super app as it is looking to gain more clarity on the new ecommerce consumer protection policy.  

As per reports, the proposed consumer protection ecommerce laws, 2020, can impact Tata Digital’s super app strategies since it is also an ecommerce entity. And as per the new rule, a super app is considered an ecommerce marketplace. Notably, the proposed amendments suggest that a related part or associated company of an ecommerce marketplace that is indirectly or directly linked to the marketplace can’t be a seller on the platform.  

As we mentioned in our previous story, CAIT’s “Halla Bol” Campaign Against Ecommerce is Troublesome, the “related-party” rule in the policy has big impediments because, under the rule, one can even consider a last-mile delivery partner of the online marketplace company as a related party. 

The commerce ministry in July this year sought feedback on the draft consumer protection rules as it is looking to shield local retailers from online giant retail marketplaces like Amazon and Flipkart. However, these rules may affect the plans of local companies looking to foray into the ecommerce market. 

In the first week of September this month, a report from Financial Daily, citing an unnamed official, stated that the “Tata Digital team would wait until there is more information on the business structure as per the new rules. (18)”

“There is no essence in initiating it and then reworking the entire business model. It is largely in shape, and we will get it off the ground once everything becomes more clear,” stated an unnamed official.

However, the latest reports suggest that Tata has decided to go ahead with its plans to launch the super app irrespective of the revised ecommerce rules.

Read Also: Prime Video is Trying to Be a Super OTT App; What Makes Amazon So Confident About This Strategy?

 

When Can We Expect Tata’s Super App Launch?

Reportedly, Tata Digital’s 400 million user bases across its various digital verticals will be able to use the one-for-all portal by early next year. 

Previously, Tata Digital test-launched the super app within a closed user group in Bengaluru. As of now, Tata’s 700k employees are testing the app. According to an ET report (19), all Tata employees will access the app in phases over the upcoming months.  

According to the cited ET report, officials know that a closed user base has already started beta testing the platform. And over the upcoming few months, it would be accessible to all of Tata Group’s employees in a phased manner.

People privy to the matter have informed the media that even though the super app is developed, the Tata Group is taking their time to decide its launch, considering the improbability of any revised ecommerce guidelines as previously expected. 

In short, as long as there are uncertainties regarding the revision of consumer protection rules, we can expect Tata to hold the broader launch of its super app. 

According to the officials mentioned above, some of the companies have already onboarded themselves on the super app, including Croma, 1mg, BigBasket, and Indian Hotels. However, Tata CLiQ is yet to sign up on the app because of the need to change its business model to be compatible with the all-inclusive platform. 

We believe that Tata will have to ensure that the product categories in its super app complement each other. In addition, there should also be a strong loyalty program like loyalty points, which people can later redeem for other purchases made on any Tata brand (20). 

Read Also: Take Your E-Commerce to The Next Level with Livestream Shopping

 

Summary

  • Tata Digital’s super app will be available to its 400 million userbases by early next year. 
  • Tata had put its one-stop platform on hold as it sought clarity over the new ecommerce rules. But, it has now determined to go ahead with a beta launch irrespective of revised ecommerce. 
  • Tata has test-launched its super app with a close group of people in Bengaluru, where now over 700k of its employees will test the app. 

 

Closing Remark

Tata’s mindset will be the key in determining the success of its super app. However, at the same time, there is no denying the fact that no other business touches the heart of Indian consumers the way Tata Group does. 

Its relentless innovation, an inclination for autonomy, and legendary culture are a great pull. 

Overall, Tata has all the chops to be India’s one-stop shop and be its first successful super app. 

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Rucha Joshi, currently managing a team of over 20 content writers at TimesNext is fueled by her passion for creative writing. She is eager to turn information into action. With her hunger for knowledge, she considers herself a forever student and a passionate leader.

Disclaimer: The views, thoughts, and opinions expressed in the article have been curated for our audience and does not warrant a 100% accuracy. All the information mentioned in the article is subject to change according to the changing viewpoints. Feel free to reach us at [email protected] for any change or copyright issues.

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Team Rucha Joshi
Team Rucha Joshi
Rucha Joshi, currently managing a team of over 20 content writers at TimesNext is fueled by her passion for creative writing. She is eager to turn information into action. With her hunger for knowledge, she considers herself a forever student and a passionate leader.

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