- Messaging, delivery, shopping, and financial services. That was the recipe for the success of the WeChat platform in China, which now apps are following;
- Brazil is attractive to this super-app market due to the possibility of offering micropayments aiming at the unbanked population.
The COVID-19 pandemic pushed users to spend more time on their mobiles, entertainment during social distancing, and delivery and shopping to avoid contagion. A study by the AppsFlyer analytics platform shows that app downloads in Brazil increased by an average of 25% in the pandemic. Food delivery applications increased 238%, and bank applications increased 25%. One of the pandemic’s legacies to Latin America is the rise of super-apps wannabes, which are increasingly gathering a large number of activities on the same platform. Magazine Luiza, Mercado Libre, WhatsApp, and Rappi are some of the region’s firms making progress in this business model.
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Messaging, delivery, shopping and financial services. That was the recipe for the success of the WeChat platform in China, which today has more than a billion users.
While WeChat functioned as WhatsApp, it started selling games and adding services until it entered the retail sector. At the end of the day, it became a platform with a marketplace with messaging and financial services. “To a point that you are able to do more than just sending and receiving messages through WeChat; you can move your account, buy things, check prices, or even buy in the physical environment,” explained Edson Santos, founding partner of Colink Business Consulting and co-author of Payments 4.0 in an interview with LABS.
Brazil is attractive to this super-app market due to the possibility of offering micropayments aiming at the unbanked population, reported Valor Econômico. Specialists say that the most promising sectors for the super apps are retail, mobility, and health.
The idea behind the super app is to converge all the user’s needs into the same app, which, for the user, can bring more convenience of purchase and better user experience, since the app is already used to the consumer’s tastes and preferences. For the company, it is a godsend: the user spends most of his time inside the platform.
Rappi
Rappi has been taken steps to be the most complete app in Latin America, just as Uber started doing in the United States and Magalu and Banco Inter do in Brazil. Rappi consolidated itself in the market for delivery of restaurants, pharmacies, and convenience items and later started offering services such as manicures, domestic activities, massages, among others, reported Revista Gama.
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Rappi launched a digital bank with a credit line for partner companies, a card for individuals, and cashback. The app had already created RappiPay, for means of payments and a shopping area, and another dedicated to be an entertainment hub with streaming. It also announced Rappi Travel for the reservation of airline tickets, buses, and hotels, intending to later add car rentals, tours, and travel insurance.
Magazine Luiza
Magazine Luiza’s app started as an online shopping platform and gradually started to offer food, fashion, hygiene, and mix its products. Last year Magalu created its own payment method that allows not only to buy through the app but also to carry out financial transactions. Get to know Brazil’s Magazine Luiza here.
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Inter
Formerly known as Banco Inter (Inter Bank), the company now goes only by Inter. The name change reflects a revolution in the business model of the company, which aims to be more than a financial institution. Inter states that its main goal is to be a “platform that simplifies people’s lives”. Nevertheless, financial services are still the company’s core business.
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Currently, Inter has five main operations: banking services, credit, insurance, investments, and e-commerce. These operations are all grouped in what the company calls its “super app”. In an interview with LABS, Inter’s CFO, Helena Lopes Caldeira, says the company believes that only a complete platform can really generate value to the customer. On Inter’s app users can buy products, book hotels and plane tickets, order food and enter credits for Uber, getting cashback.
PicPay
The popular Brazil’s digital wallet PicPay just opened the range of financial services for e-commerce and the insurance market. It announced it now has surpassed 35 million users. The fintech also announced an in-app messaging platform for the first half of 2021.
Uber
Uber’s new interface gathers all functions: UberEats delivery, car trips, grocery’s delivery and a pick-up and parcel delivery service. Last week, Uber launched, in partnership with Surf, a telecom that offers white-label connection service solutions, Uber Chip, a prepaid cell phone plan in which the driver or delivery partner does not need to use their own data package to use the Uber Driver app.
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Mercado Libre
Argentine e-commerce giant Mercado Libre is already a platform, with marketplace, payment services (Mercado Pago), and logistic services (Mercado Envios). This platform has the ambition there to become an ecosystem.
Both Mercado Libre and Magazine Luiza are following very similar paths, they only started from different places. Mercado Libre arose from the idea of a marketplace and Magalu already had brick-and-mortar stores. Both of them are in a process of creating a platform and an ecosystem.
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One of the most used applications by Brazilians with 120 million users, the west version of WeChat, Facebook‘s WhatsApp has announced WhatsApp Pay in Brazil, but the project has been suspended for regulatory review.
According to Luis Filipe Cavalcanti, also a partner at CoLink Business Consulting, director of investments by MIT Alumni Angels, and vice president of MIT & MIT Sloan Alumni Brazil, big techs have extraordinary know-how in the user experience and a super app and could be well adopted in Brazil, for example. But, around Latin America’s largest country it concerns the legislator about the General Data Protection Law (the Brazilian version for GDPR), “because when you gather all the information from the web, everything you do on your cell phone and include payments and financial services, you have a recipe to know everything about the consumer,” he said.
“We think that the Brazilian Central Bank is very attentive to this and we believe that big techs will enter the market complementing questions of experience and moving the chain, providing a way to pay more intelligently and more appropriate to each type of consumer.”
