All hail the superapp

In case you’re not familiar with the term, a superapp is pretty much what it sounds like: an app that does it all. The concept of a superapp was theorized a long time ago, when a handful of tech startups started eating the Internet, M&As were abundant, and perhaps we were all more optimistic about the future.

The idea was that a single company would expand into enough categories to cover every facet of consumer demand, or at least a good enough approximation. Imagine a world where Google, Amazon, or Meta run your entire life: from banking to grocery shopping to social media to entrepreneurship, everything you need is one tap away, all in one integrated and irresistibly compelling product.

But because this is an eCommerce newsletter, let’s speculate about what an eCommerce superapp might look like, and who’s best positioned to get there.

Let’s start with the basics: when you think about a relationship between any given brand and any given consumer today, it’s always pretty much the same four-phased journey:

1. Discovery: I learn about a brand I didn’t know about before.
2. Consideration: I determine whether I should buy from the brand.
3. Purchase: I buy something from the brand.
4. Retention: I keep engaging with the brand, and hopefully buy more.

(Yes, this is a gross oversimplification. But this newsletter is long enough already, so I’ll let your imagination fill in the blanks.)

What’s more, the relationship is not just between the brand and the consumer anymore. The DTC industry has ushered in a new era of content creators, curators, and influencers—a movement that has been shaping consumer decisions and marketing budgets. Everyone is a curator now.

So how could an eCommerce superapp facilitate the consumer journey while engaging both brands and influencers? Here’s an idea:

1. Discovery: The app knows enough about me to act as a discovery engine but also allows me to tap into professional and everyday curators and friends to discover new brands and products.
2. Consideration: A streamlined brand and product model allows the app to facilitate consideration in a way consistent with my values and preferences, and to tap into my network to get their advice and recommendations. There are tons of opportunities here to leverage generative AI in powerful ways.
3. Purchase: The app facilitates a smooth purchase process and suggests cross-sells with other brands I might enjoy (purchase+discovery!). This is almost a commodity nowadays and the piece that would be least challenging to solve.
4. Retention: After the purchase, the app provides both the consumer and the brand with powerful tools to keep engaging with one another. Curators can still play their part here by participating in retention activities, product drop campaigns, etc.

There’s so much more that I’m not talking about here, but you get the idea: a superapp can act as a bridge between different players of the ecosystem, facilitating the exchange of cultural and economic capital and perhaps creating entirely new ways for that exchange to take place. Let’s not forget the potential to completely circumvent any marketing attribution issues by keeping all the data in one platform.

It goes without saying that this kind of strategy is, at the same time, incredibly compelling and insanely hard to execute. The potential upside is enormous, but superapps require massive amounts of capital and coordination, not to mention very favorable markets and regulators, and they can fail for a million different reasons in a million different ways.

In fact, when you look at the landscape of eCommerce and marketing technology providers today, they only cover a few phases of this journey:

• TikTok handles discovery and consideration, but the purchase and retention aspects still leave a lot to be desired. Brands are not ecstatic about TikTok Shop, although it is getting better every day.
• Amazon handles discovery (to an extent) and purchase but still sucks at facilitating consumer consideration and customer retention. They are making a few sluggish attempts— see Amazon Live and Consult-a-Friend, but they’re all bolted on top of what’s otherwise widely considered to be a commerce and logistics company, not a social media company.
• Shopify handles purchase and retention but doesn’t bother with discovery and consideration—that is, unless you count their recent experiments with the Shop app (like Shop Cash and Shopify Collective), which are still very much up in the air.

I’m not even listing Meta here since they’re so laser-focused on building the best customer acquisition engine in the industry—and they are pulling it off, so perhaps it’s for the best.

Of the three, I believe TikTok is best positioned to make the jump. It’s far easier for TikTok to develop better eCommerce technology—which is an engineering problem—than for Amazon or Shopify to get into social media—which is a network effects problem. TikTok already owns the consumer’s attention, they “just” need to activate it in the right ways and provide merchants with the tools to succeed. If the appetite is there, it’s well within the realm of feasibility.

With that said, this is a nut that might take TikTok years to crack. You don’t build a superapp overnight, and right now, the tech industry seems more interested in divesting projects that aren’t their core focus than in verticalizing. TikTok has also been under heavy regulatory scrutiny in the West, and they might have a hard time penetrating even more facets of our economy.

The good news is that TikTok can afford to play the long game. Who knows—if they manage to overcome these headwinds, in a few years from we might all be welcoming our new superapp overlords.