Gautam Adani wants to construct a super-app using passengers at his airports. However, now is not the greatest moment for new technology companies, and competitors may already be better positioned.
Gautam Adani is getting set to debut his much-touted super-app, created by an in-house business he hopes would be “the Ferrari of the digital world.” In a recent interview with the Financial Times, Asia’s richest businessman predicted that the portal will be live within three to six months. Adani, on the other hand, appears to have missed the sweet moment when demand for online services surged during the epidemic. The global tech industry is now in upheaval. In the meanwhile, competition in Indian e-commerce is fierce. Is Adani’s Ferrari going to be stranded in traffic?
According to the Financial Times, the smartphone app would connect customers at Adani’s airport network with other services provided by his company. That might be the simplest strategy to increase downloads. Adani operates seven airports in India and is currently constructing a new terminal and runway for Mumbai’s second airport. In all, he handles 20% of the nation’s aircraft traffic. If Adani throws in a free trip home — he’s also investing in taxi fleets in places where he has airports, according to media sources — he could possibly entice millions of phones to load his as-yet-unnamed app.
However, when the economy recovers, several of the more specialized categories that grew in popularity during the epidemic, such as education and beauty, and fashion, are either dying or not rising as rapidly as previously. Amazon is abandoning the test prep and food delivery businesses in the country. According to Bloomberg News, Paytm, India’s largest digital-payments service has seen its shares plunge 75% in the year following its initial public offering, the worst first-year performance for a significant IPO in a decade.
Online grocery buying is increasing, but Adani’s competitors — Tata Group’s Big Basket and Mukesh Ambani’s JioMart — have a head start in what is considered as a critical hook to increase consumer engagement.
Pharmacies are rapidly expanding, and Ambani’s Netmeds and Flipkart’s Health Plus are doing well. Adani has a modest consumer-facing web presence. The Ahmedabad-based company acquired a major minority share in Cleartrip, a Flipkart-owned travel booking service, a year ago. All the more incentive for Apple to make transportation the focal point of its super-app aspirations.
How quickly can Adani hope to expand? With the exception of airports, electricity and city-gas distribution, and edible oils, the remainder of his empire is mostly focused on mining, logistics, and infrastructure, none of which provide many opportunities to engage with end-users. Even for the 154-year-old Tata Group, which is involved in everything from salt and tea to automobiles and airlines, gaining a monopoly on customers in the digital world is difficult.
That’s only the beginning. The second challenge will be to get customers to return for more.
The Chinese approach combines retail, payments, entertainment, social networking, and money in one location. It was refined by the likes of Alibaba Group Holding Ltd., Tencent Holding Ltd., and Meituan before Beijing became concerned about the dominance of its digital titans and made them the focus of harsh antitrust action. Although last year’s tech crackdown has eased, China’s Covid-19 rules continue to be a drag on consumption: Alibaba just reported an unexpected quarterly loss. Investors in Southeast Asia, where the template was successfully replicated, are now demanding profitability before expansion. GoTo Group is an Indonesian conglomerate established by the combination of ride-hailing company Gojek with e-commerce company Tokopedia.
Tata Neu will not be the only competitor to contend with. Ambani, who constructed his digital moat during the epidemic when money was flowing into IT, will be Adani’s stronger adversary. Through his Jio mobile network, Asia’s second-richest businessman has access to 428 million telecom users. Ambani is also India’s largest retailer, with plans to expand into financial services. Credit is the glue that holds a successful super-app together, or so the experience has been elsewhere in Asia.
