Introduction

What’s the Story? A super app is a single mobile or web application that offers a portfolio of services and products. The concept first emerged in Asia, where companies such as WeChat, GoJek and Grab leveraged traffic on social media and communication platforms to offer additional services. China’s WeChat, for example, started as a messaging app before expanding into payments, taxi booking, shopping and food ordering, thus becoming a super app. Like WeChat, most super apps have one high-frequency core offering, which leads customers to other products and services in the app with little friction. The latest super app on the market in India is Tata Neu, which was launched by Indian multinational conglomerate Tata Group’s digital business, Tata Digital, on April 7, 2022. In this report, part of our India Retail Insights series, we examine the Tata Neu super app, covering its core offerings, features, benefits and plans for growth. We also discuss India’s super-app ecosystem as a whole, including its major players. Why It Matters Increased smartphone ownership among Indian consumers, along with growing reliance on digital payment solutions, will lead to greater adoption of mobile commerce through mediums such as super apps.

• India has the second-largest population in the world, at 1.4 billion, and 75% of the total population is aged above 14 years, according to the United Nations Population Fund’s (UNFPA’s) 2021 data.
• The total number of Internet subscribers in the country is 834.3 million as of September 2021, according to the latest data from the Telecom Regulatory Authority of India (TRAI).
• India’s smartphone user base is set to reach 1 billion in 2023, according to Statista data—more than double the 2018 total—representing high-single-digit year-over-year growth (see Figure 1 below).
• India accounted for around 14% of global app installs in 2020, representing 28% year-over-year growth—four times higher than the worldwide average of 7% growth for the same period—according to a January 2021 report by InMobi, a mobile advertising technology company.

Increased smartphone ownership among Indian consumers, along with growing reliance on digital payment solutions, will lead to greater adoption of mobile commerce through mediums such as super apps.

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Figure 1. Number of Smartphone Users in India (Mil.) [caption id="attachment_147641" align="aligncenter" width="699"] Source: Statista[/caption]   Super apps also provide heightened convenience by combining multiple services into a single app, allowing smartphone users to eliminate other apps, declutter their devices and save storage space. With the country’s young, smartphone-using population and growing acceptance of apps, there is opportunity for both Indian and international companies to enter India’s evolving super-app ecosystem.

Exploring India’s Latest Super App and the Wider Super-App Ecosystem: Coresight Research Analysis

Tata Neu: India’s Latest Super App Core Offerings Tata Group claims that its super app, Tata Neu, seamlessly integrates the group’s most trusted brands, services and products on a single platform for a consumer-focused, future-oriented experience. [caption id="attachment_147642" align="aligncenter" width="393"] Source: Tata Neu[/caption]   The super app features a variety of Tata Group brands across many product categories, including grocery, consumer electronics, fashion, pharma, financial services, and travel and hospitality. Tata Neu app users can order groceries from BigBasket, medicines from Tata 1mg, electronics from Croma and apparel from Westside, all within the same app. However, app users must complete separate checkouts for each brand. Natarajan Chandrasekaran, Chairman of Tata Sons, the private entity that owns Tata Group, said in a LinkedIn post:

Tata Neu is an exciting platform that gathers all our brands into one powerful app. Combining our traditional consumer-first approach with the modern ethos of technology, it is an all-new way to discover the wonderful world of Tata. Our aim is to make the lives of Indian consumers simpler and easier.

In Figure 2, we summarize the key categories and brands offered in the Tata Neu super app.

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Figure 2. Key Categories and Brands Offered in Tata Neu [caption id="attachment_147653" align="aligncenter" width="700"] Source: Company reports[/caption]  

Loyalty-Building Features

The Tata Neu super app provides exclusive offers, an integrated loyalty program and diverse payment options for ease of use. Below, we discuss some of Tata Neu’s key and loyalty-building features and resulting consumer benefits.

• NeuCoins

Customers earn NeuCoins for every successful transaction they make on the Tata Neu app and website, as well as Tata brand stores and hotels. Customers can then redeem NeuCoins for discounts on future purchases. 1 NeuCoin is worth ₹1 ($0.01), and there is currently no limit on the number of NeuCoins customers can earn or use on a single order.

• NeuPass

NeuPass is a membership program available on Tata Neu that offers its subscribers a wide range of benefits and privileges, including exclusive offers, free deliveries and early access to product launches. Most notably, it allows members to earn 5% more NeuCoins (minimum) for every successful transaction on Tata Neu. Commenting on NeuPass, Chandrasekaran said, “We have a strong omnichannel footprint and NeuPass is universally applicable across all our verticals. We believe NeuPass will be the core asset that will attract customers.” [caption id="attachment_147643" align="aligncenter" width="700"] NeuPass membership program page (left) and NeuPass benefits page (right)
Source: Tata Neu [/caption]  

• Tata Pay

Tata Pay is Tata Neu’s built-in Unified Payments Interface (UPI) service—connecting with India’s fast, real-time payment system that enables inter-bank transactions between people and businesses. It allows users to purchase products and services in the app, use real-world contactless payment systems, pay utility bills and send money to friends or family. Tata Neu’s built-in UPI feature offers a seamless checkout experience, eliminating the need for users to enter their UPI ID each time or switch to external UPI apps such as PhonePe, GPay or Paytm to complete the transaction. This leads to more completed orders, as switching to an external UPI app can lead to transaction failures due to unresponsive pages or connectivity issues between the app and the payment interface. In addition, Tata Pay offers rewards on all credit card spending and offers users personal loans, credit lines and customized insurance plans, all within the super app. [caption id="attachment_147644" align="aligncenter" width="700"] Tata Pay enables peer-to-peer and utility bill payments
Source: Tata Neu [/caption]  

• Stories

Tata Neu’s in-house digital magazine, Stories, publishes lifestyle articles and videos to “entertain, educate, and inspire readers,” focusing on technology, fashion, food and travel. In addition to creating content that regularly brings users back to the app, Tata Neu uses Stories to attract consumers to product pages. When offering content about a certain topic, such as fabric, sustainability or trending styles, Stories can highlight related products available from its in-house brands. It also provides a “Shop Now” feature, taking consumers right to those products on Tata Neu. [caption id="attachment_147645" align="aligncenter" width="656"] Stories offers digital content
Source: Tata Neu [/caption]   Plans for Growth and Upcoming Features While NeuCoins, NeuPass, Tata Pay and Stories are currently live in Tata Neu, Tata Digital is planning to add many features to the super app in the coming months and years, including the following:

• Funding—Tata Sons is reportedly planning to make an interim investment of $500 million in Tata Digital for Tata Neu’s continued growth, per leading Indian media platform Inc42. Tata Group is also holding talks with global investors such as Canada Pension Plan Investment Board, Singapore’s Temasek Holdings, SoftBank Group and Abu Dhabi Investment Authority to fund the super app’s growth plans.
• Third-party brands—According to Tata Digital’s CEO, Pratik Pal, the company currently has a roadmap for adding new categories and brands to Tata Neu, including both third-party companies and more in-house brands, such as luxury brand Titan and jewelry brand Tanishq.
• Increased benefits to small sellers—Pal stated that the small sellers and retailers supplying its existing brands, such as BigBasket and Croma, will benefit from Tata Neu’s increased footprint, growth and sales.
• Customer-driven evolution—As Tata Neu expands its offerings beyond Tata Group brands, its evolution will be customer-demand-driven, not contract-driven, according to Chandrasekaran.
• BNPL (buy now, pay later)—Chandrasekaran said that Tata Neu plans to introduce a BNPL feature to cater to millennials.
• Enhanced NeuPass benefits—NeuPass will feature enhanced benefits for members, such as sneak peeks at tech innovation and an artificial intelligence (AI)-driven personal assistant.

Consumer Responses On its launch day, Tata Neu faced several issues, resulting in users taking to social media to complain. For some, issues began during the sign-up process where Tata Neu asks for the user’s mobile  number and sends them a one-time password (OTP) to verify the number. While some users did not receive the OTP (or received multiple), others received a server error that did not allow them to continue the sign-up process. [caption id="attachment_147646" align="aligncenter" width="700"] Source: Twitter.com[/caption]   Meanwhile, others faced issues inside the app after signing up, including timeouts, server and other errors, disconnects, long load times and products failing to be added to their basket. [caption id="attachment_147647" align="aligncenter" width="700"] Source: Twitter.com[/caption]   In response to these issues, Tata Neu replied to customer tweets, apologizing for the inconvenience and reaching out directly to customers via text and e-mail. However, despite delays in launch dates and a few technical day-one glitches, Tata Neu is currently quite popular among Indian consumers. In a press conference on April 14, 2022, Pal said that the super app has registered 2.2 million downloads and witnessed a “significant” number of transactions in its first week. As of May 11, 2022, the app has more than 5 million downloads via the Google Play store. India’s Super-App Ecosystem Tata Group isn’t the only pioneer in the Indian super app space. Before Tata Neu’s launch, Indian companies Reliance Industries and Paytm each launched super apps.

• Reliance Industries, a retail conglomerate, launched its super app, MyJio, under its Jio umbrella. MyJio offers entertainment streaming—music (JioSaavn), online games and movies (JioCinema)—mobile phone payments and online grocery ordering from JioMart. Like Tata Group, Reliance currently only offers its owned services.

[caption id="attachment_147648" align="aligncenter" width="485"] Reliance’s MyJio app offers entertainment content streaming, payments, mobile recharge and grocery delivery
Source: MyJio [/caption]  

• While Paytm started as a digital payments platform and financial services company, it recently brought together other services, including ticket bookings, games, online shopping, banking and consumer finance, into its titular app.

Furthermore, according to Indian news channel The Times Now, Reliance is reportedly building another super app, separate from MyJio, that will offer services, in-house technologies and third-party integrations. Reliance is planning to rollout the super app by integrating the offerings of Justdial—an India-based internet technology company and local search engine—in which Reliance Retail acquired a majority stake for ₹35 billion ($458.7 million) in September 2021. Over the last two years, Reliance has acquired various startups, including online pharmacy portal Netmeds, online furniture store Urban Ladder, subscription-based micro-delivery service Milkbasket and women’s online lingerie store Zivame. Reliance’s newest super app could feature all of these brands’ services and products under one digital roof. Meanwhile, global players such as Amazon, Google and WhatsApp have also tweaked their offerings and launched new services in India via apps. In Figure 3, we summarize the new service offerings.

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Figure 3. Service Overview of Global Players’ Super-App Offerings in India [wpdatatable id=1976 table_view=regular]

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Source: Company reports/YourStory/Coresight Research India’s super-app ecosystem is still in its nascent stages. Early super apps used their core offerings—such as communication platforms or ride-hailing services—to attract customers before adding on services such as food and grocery delivery, and movie ticket bookings. Unlike early super apps, Tata Neu focused on total customer convenience from the very beginning, integrating all its e-commerce offerings into a single platform from day one. We see India as the next target market for super apps, given its sizeable mobile-first population, as most Indian Internet users access the Internet through mobile phones, per a 2019 report by the Internet and Mobile Association of India and market research firm NielsenIQ (latest available data). Meanwhile, according to a June 2021 report in The Indian Express newspaper, many consumers in India are experiencing the Internet for the first time thanks to mobile phones. Both the increase in mobile phones and India’s mobile-first population could lead to a proliferation of super apps in the country in the future.

What We Think

We expect retail conglomerates and companies with multiple consumer-facing businesses, including international players, to look at super apps as one way to integrate all their offerings under one digital roof, which will also provide revenue-generating opportunities. However, we believe that new super apps in India will focus on complete consumer convenience rather than occasional augments to core service offerings, as early super apps did. These apps will also provide companies with large volumes of data, allowing them to learn more about consumers’ buying behaviors and preferences. We expect India’s super-app ecosystem to gain traction as competition intensifies in the space. With growing Internet and smartphone penetration, we strongly feel that India’s lower-tier markets will offer a robust consumer base for companies’ super apps. Implications for Brands/Retailers

• Online brands should look at partnerships with companies building super apps to increase their footprint and reach new consumers.
• Brands and retailers can leverage the consumer data from super apps to offer their consumers personalized products, services, deals and offers.
• Companies building super apps should also integrate technologies such as 3D product models, AI and virtual reality for a seamless shopping experience.

Implications for Technology Vendors

• Technology and software-as-a-service companies benefit through long-term association and partnerships with brands building super apps.