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EXCLUSIVE: “At Your Service” – Gijsbert Pols, Adjust in ‘The Paytech Magazine’

EXCLUSIVE- “At Your Service”– Gijsbert Pols, Adjust in ‘The Paytech Magazine’ | Fintech Finance

They’re our virtual valets, poised to fulfil our every whim… we asked Gijsbert Pols from Adjust where the super-apps’ super-powers might take them next.Gijsbert Pols, Lead Product Strategist at Adjust | Fintech Finance

Anyone with kids – and many without – will be familiar with Iron Man’s virtual assistant, Jarvis – and will no doubt have mused on how wonderful it would be to have a Jarvis at their own beck and call. Could fiction now be about to blur into reality with the rise of so-called super-apps and numerous financial firms, big tech providers and even traditional retailers queuing up to develop the one that trumps all others when it comes to fulfilling our every wish?

The explosion in both popularity and capability among Asian super-app frontrunners like AliPay and WeChat  Pay has proved the possibilities,believes Gijsbert Pols, lead product strategist for marketing analytics specialist Adjust, which supports app developers in better understanding their target audiences to thereby increase reach.

At the heart of all super-apps, and their reason for being, of course, is payments – the gateway to all the associated experiences they have evolved to provide. Alipay, for example, started life as a digital wallet, later adding everything from e-commerce to stock exchange trading.

The recent Industry Analyst Consensus Report from research house CB Insights, describes mobile wallets as ‘one of the fastest-growing industries in the world’, predicting explosive growth from $1trillion now to $7trillion by 2027. It also suggests that what it calls ‘super-wallets’ will replace single-function digital banking and payments solutions, and add functionalities from AI-powered digital assistants to digital IDs and document stores, with ‘a growing number of companies striving to become the go-to app for all things finance’ and so have ‘substantive impact on individuals’ day-to-day lives’.

Companies vying to offer what the report describes as ‘a connected ecosystem where users can manage payments, savings, investments, crypto, budgets, loans, insurance and more, all in one place’, include fintechs like SoFi, which started out as a student loan provider and added banking, investment, insurance and credit products, and Venmo, which has added a cash account, a debit card, a credit card, in-store QR payments and crypto investments. Then, of course, payments giant PayPal now provides access to high-yield savings accounts in collaboration with Synchrony Financial, as well as a bill management tool covering pay early as well as loyalty and rewards functions.

In fact, life could get tricky for traditional financial services players that fail to embrace this trend, given the report’s prediction that ‘super-apps will be the dominant fintech strategy of the next decade, and pose a growing threat to legacy financial players as well as single-function fintech apps’. These players also face stiff competition from the likes of big tech, not to mention mobile technology providers, also keen to leverage their phenomenal user bases to gain a foothold in the super-app and super-wallet space.

Adjust’s Mobile App Trends 2021: A Global Benchmark Of App Performance report found the pandemic had acted as a further springboard for super-app culture, concluding that ‘as lockdowns were introduced across the globe, users downloaded and opened apps at rates that eclipsed previous years and projections’. However, Pols believes the greatest evolution for these flexible, digital friends, through which we’ve become used to doing everything from ordering pizza to sourcing tradespeople and ‘meeting’ with friends around the globe, could yet lie ahead. We asked him how…

The Paytech Magazine: There is clearly a lot of competition, with a wide range of providers considering entering the super-app space. What comes next?

Gijsbert Pols: Understanding what might be possible in the future, requires a glance back at the origin stories of some of the world’s current, most influential apps.  Thanks to environments where there was no Google or Facebook, archetypal super-apps like WeChat and Alipay grew rapidly across a lot of verticals and into something that allows you to do basically anything.

To explain super-apps, I always use the example that, one morning, you wake up and find your bathroom flooded. Then, you call a plumber and notify people at work that you have a home emergency you need to fix. You wait for the plumber, clean up the bathroom, and while you wait you might answer emails, check your stocks, watch the news, do some procrastination on social media. When the plumber arrives, you pay them, maybe also review them and call a taxi to get to work. In a super-app environment, you could do all that inside one app. And, in future, users will be able to do more and more.

Super-apps are very well positioned to thrive in regions where there is a gap in terms of under-banking, or under-servicing. Indonesia is a very good example, where you have [ride-hailing app] Gojek that managed to profit from a situation where people were underbanked and where a lot of services were not available. In countries like Nigeria and Kenya, payment apps copy WeChat, in the sense that they try to grow across verticals, and offer as many services as possible. It’s something to bear in mind when you think about the Nigerian diaspora, for instance, sending huge sums of monies to their relatives back home.

Super-apps like WeChat – and Paytm [in India], up to a point – are already starting to function as platforms or operating systems, rather than tools. In WeChat, what they call mini programs, mini applications or applets, function as add-on pieces of software on the platform rather than an app next to another app, allowing users to do things and third parties to offer services. In terms of a social function, it would be pretty hard to operate in China without WeChat these days. If I went there to work, as an expat, I would have to install WeChat to do business, socialise or even pay for finger food on the street. Super-apps can be a concierge in your pocket, you take them anywhere and you can do whatever you need to do, wherever you are.

TPM: Clearly, the particular needs of developing countries acted as a catalyst for super-app creation. Could this potential be matched in the Western context?

GP: In regions where there is a gap, or a vacuum, in terms of underbanking, or underservicing, super apps have been very well positioned to thrive. In most Western contexts, you still need six or seven different apps to do the same things. There are specific use cases emerging there, though, that are super-interesting. Right before the pandemic, for instance, a San

Francisco museum developed a mini program that could function on WeChat, which enabled guided tours for Chinese tourists. As an advertiser in North America and Europe, if you want to reach the Chinese diaspora, or Chinese tourists, there is no way around the super-app.

Even Chinese people living in the UK use WeChat there, albeit not on the everyday basis as they would in China. I don’t think we will ever see something on the scale of a WeChat in the West because regulation, at some point, will get in the way, and adoption would be much slower because there is no under-banking and we have functioning legacy services in place. But it’s possible, as history does prove the case for convenience!

TPM: What is that secret ingredient that has made existing super-apps, well, super?

GP: As well as the convenience, there’s the power of sheer mass. If your mother, your boss, your best friend and your nephew are using it, and your bakery allows you to pay with it, at some point, you’re going to have to, too. Then, super-apps have filled market gaps. Indonesia is the best example where, when it comes to banking, they jumped over a couple of phases, from cash directly into digital payment, because people can do so much with their Gojek or Grab apps: hail a taxi, book a massage, order goods, do their grocery shopping, and even, with Gojek, watch movies.

What also makes them interesting, particularly Gojek, is people’s strong identification with them. Gojek, for example, has become a symbol of Indonesian economic development and prosperity. There was one point where Gojek was offline due to some regulatory issues and there was a massive outcry on social media, with the hashtag #savegojek. People start to identify with these super-apps – I would argue even more than they identify with the big techs.

Digital payments and mobile are the basis of the super-app. The fact you can pay with it allows it to grow across the verticals. Even Gojek, which started as a ride-hailing app, smartly implemented payments so that Gojek drivers could be paid using the app, which allowed them to start other services pretty rapidly. It saw that its drivers, who are all employees of the company, were only busy during rush hour and weren’t doing anything in between. So they said ‘let’s start using them to drive people that offer services to people who want to consume them’ – driving people who offer massages around, driving groceries around, and that’s how the ball started rolling.

TPM: Do you foresee any change in the companies dominating the super-app top table?

GP: Not only are digital players like Facebook, Google and Uber trying to work their way into the super-app phenomenon, with things like Uber Eats, we’re also seeing more traditional, non-finance companies like Walmart starting to adopt super-app tactics. Walmart has been trying to develop a super-app in India, and is investing a lot of money in trying to beat Amazon and Paytm there because it’s such a big consumer market and they see that people have become used to doing a lot of stuff in one app.

Given super-apps’ scope to disrupt the traditional financial landscape, in particular, banks urgently need to get in front. In the West, instead of just allowing people to manage their finances, banks should innovate by asking themselves ‘how do we enable people to do things?’, on a basic level. If they fail to do that, despite the huge trust people have in banks, and all the legacy that’s there, they will lose the game in the end. Having said that, banks are in a fantastic position to innovate. Because, let’s face it, what makes digital so successful? It’s data. And banks have a lot of data. With my bank, I sometimes think ‘you know what I’m spending, why aren’t you advising me where I’m spending too much, or too little?’. Why can’t I see how much I’m spending in different categories when I open my banking app?
f they don’t start providing that, pretty rapidly, they are going to lose customers towards apps, super-apps or not, that do.

TPM: Are there inherent dangers in more super-apps forming digital monopolies, which could act as barriers to entry for others and potentially harm innovation?

GP: Any major concentration of power, be it political, economic, social or cultural, has deficits, and monopolies have a very negative side that doesn’t fit easily with the concept of democracy. There’s the ever-growing gap between rich and poor, prompting concern over how rich the owners of existing monopolies are. That’s problematic and the same can happen with super-apps.

The other thing we’ve seen with such monopolies, is that governments can make use of, or abuse, them. That’s something which is particularly topical, given current events. For example, the gigantic centralisation of data on people’s behaviour being used to basically spy on and repress them. And we know that governments, both in the West and other regions, have been doing this. Censorship takes place everywhere where these monopolies arise. We’ve seen that, in the digital era we’re currently in, laissez-faire politics results in monopolies. Some super-app monopolies exist already, Gojek and Grab are in a monopoly position, and Paytm in India is heading there. The only way to do something about that is regulation. We will have to wait for a moment where the people who have legislative power are digital natives, too, and then we can reform, or legislate, the digital space in such a way that it doesn’t get in the way of business.

It’s a bit paradoxical, in that government is both part of the solution and part of the problem. They’re the only ones who can put the legislation in place that breaks these monopolies, but, on the other hand, they can also profit from them. It’s a tricky situation.

TPM: Despite such concerns, where could the road eventually take super-apps, in terms of game-changing innovation?

GP: We’ll see some consolidation in specific regions, particularly Southeast Asia, Africa and Latin America, where a lot of super-apps are emerging and, in the end, there will be only one, two or three.

It’ll be exciting to see to what extent super-apps fulfil the platform function, as WeChat has started to do in China. Paytm, in India, has started experimenting with this, too, so you have third-party vendors that operate on the Paytm system, and it’s going to be interesting to see whether an app like Rappi, which is very successful in South America, will be capable of doing that, too.

There’s still a lot of opportunity, in terms of capability, before they run out of road. In the short run, we’re going to see this ‘concierge’ function, where it’s all about making sure the bakery around the corner from you, allows you to pay with the super-app, and so does your hairdresser and other such services. In the long run, it gets a bit futuristic and it’s about to what extent super-apps are going to provide a virtual experience, as well.

WeChat is already offering gaming. In the very long run, I wonder whether super-apps will be able to allow users to interact as just a way of meeting, as well as playing games, in a virtual way. Up to now, super-apps have been mostly about digitising real-world services. However, in the future, I might use a super-app to play ping pong with a friend on the other side of the world. I’m not talking about video ping-pong, but actual ping-pong, facilitated by virtual reality. It’s going to be exciting to see how they can expand their offerings to a virtual space and, potentially, change the form of human interaction across geographies. The potential is definitely there to start experimenting in that direction.

Something I’m also currently working very, very hard on, is connected television. What we saw in desktop computing, in the 1990s, and for mobile phones at the end of the 2000s, or beginning of the last decade, we’re currently seeing happening in television. In the US, people are, at an ever-faster pace, doing away with their analogue cable television in favour of connected, internet-based television. That’s a major disruption that I think will lead to the kind of creative explosion we’ve seen in desktop computing and mobile.

Television content is distributed digitally, which already has a major impact on how it is consumed. It also results in the television device becoming connected with others, predominantly mobile phones, so there will be a lot more interaction between the mobile phone and the television device in people’s households, and they will manage their television consumption via their mobile phones much, much more, using them as a kind of remote control. We are already witnessing shoppable TV commercials and the mobile phone is going to play a major role in that.

And, if you add then the whole idea of digital payments and further super-apps on top, it starts to look a lot like the next potential revolution to hit this space.



EXCLUSIVE: “At Your Service” – Gijsbert Pols, Adjust in ‘The Paytech Magazine’ | Fintech Finance

This article was published in The Paytech Magazine #11, Page 56-58


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