Tata Neu: The never-before-heard story of India’s first superapp

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Introduction

The Tata Group is one of the world’s biggest conglomerates, with a legacy spanning over 150 years across 11 industries and employing close to a million people. Their most recent venture, Tata Digital, seeks to be the frontrunner in digital transformation in India, one of the world’s fastest-growing internet and consumer markets. Tata Digital is the parent company behind India’s first super-app, Tata Neu. Pratik Pal, the CEO of Tata Neu, in conversation with Ashwini Asokan, the CEO of Mad Street Den, told us the never-before-heard story of how India’s superapp was built.

He spoke at length about the idea behind the app, the research that went to it, how they picked the name “Neu,” the vision and goals for Tata Neu, and most importantly, the growth plan.

One of the most important things I took away was the power of understanding the Indian consumer. A brand that genuinely understands shopper intent and profiles can do wonders with the right tools. Understanding their typical shopping patterns across categories and brands can be a real game-changer in the hyper-competitive eCommerce landscape.

Let’s now hear the birth story in the words of Pratik Pal.

The Market and The Idea

We studied multiple areas, and we found the opportunity easy in commerce. Food and grocery, fashion, electronics, travel, and ed-tech are the categories that will explode in the next 5 to 8 years in terms of digital transformation. I’ll give an example. The penetration today of food and grocery digital is 4%. It is going to become 15% in the next five years. There is a massive opportunity for these categories to be digitally enabled. We might not see it immediately today, but India has a sizeable unorganized market. Very soon, it will become organized, and more than organized, it will become digitally enabled.

We figured out that we have 150 million consumers across all our consumer brands. It’s a huge number. 150 million is what some of the other ecosystems have built over the last ten years. We also have 4800 physical touchpoints today across India. However, consumer power is very isolated. You go to a Titan, you buy Titan, and come out. You go to a Tanishq, buy Tanishq, and not do anything else. You fly Vistara, and that is it. You go to a Taj, and that is it. But if we harness the power, the collective power of these brands, the potential is incredible.

We decided that we would not be digital-only.

We will be omnichannel because there is no other brand in India who do both online and offline well. So that was our first principle.

There are many hotels, Titan shops, Croma shops, West Side, and many more such touchpoints where we will combine the power of a digital and physical presence.

Putting Customer Experience first

We decided that we would build this whole app on experience.

While everybody says cloud-first, we said experience first.

This decision boils down to the core principles of the Tata Group. You go to a Taj today, the experience that you get in a Taj Hotel is a different class. You go to a West Side shop; it’s another class of experience you get. We cannot dilute that experience in an online channel. A person who is a Taj platinum guy today demands the same kind of experience whether he comes online or offline.

We cannot say, “Offline, I will give you a great experience. I’ll give you a chamber membership in Taj Mahal Palace in Bombay. But online, you can just book a hotel, and that is it.” There is no there is nothing special about that experience. There’s nothing unique about that experience. 

Every Tata company is built on trust, respect, and experience. Every single company.

Our biggest underlying philosophy is that just because we will build a digital channel, we cannot dilute the experience already there in the physical channels

Any digital experience is end to end, which is not only about what you see in the app. The biggest experience comes in order fulfillment. Today, one of our subsidiaries, BigBasket, bravely boasts one of the best supply chains in the country. They are now starting 20-minute delivery. That is the kind of infrastructure that they have built. So we took it upon ourselves that we would build India’s largest supply chain infrastructure, which would be able to fulfill everybody’s orders. We’re just getting started on that front.

What is Tata Neu?

What is this ecosystem? Our ecosystem is all of these brands that are on our app. One of our principles was that we would not do something that a consumer only sees in Tata Neu but doesn’t see in BigBasket or 1MG. For example, we have this concept of 5% Neu coins you get when you shop, wherever you shop, whatever you do, at any touch point. If you go to a Taj Hotel, you may not have the app, but you will still get that 5%. 

Once we set in the ecosystem play, we will have salience in pricing and everything across all the touchpoints. The consumer should not feel, “I will get 10% here, but not 10% there.” Let’s say they go to the Croma store, and you don’t get the 10% discount they see on the app. They can get confused. That’s customer friction. We said we would not have any friction in the whole ecosystem.

Once we build this ecosystem, Tata Neu will be established over a period of time. It’s not a three-month or six-month journey. It’s a 3 to 4-year journey for us. And we believe that over a period of time, the whole consumer base will shift to the Tata Neu app for the ecosystem.

Data, supply chain and omnichannel – these are the three pillars of Tata Neu.

The story behind the name: Neu

We went through 400 names till the time we selected Tata Neu. So it was not an easy journey. Every name that we chose got rejected by somebody else. This Neu name sprang up suddenly from somewhere. Neu is (pronounced) Nau in German which translates to different. We wanted new, but we didn’t get it, so we said Neu. 

Why Tata Neu?

1. Convenience
   The convenience Tata Neu will eventually offer consumers will drive them to adopt it. Tata Neu is an app for a lot of Indian households doing a lot of things. Do you want to take a loan? Do you want to take an insurance policy? Do you want to consult a doctor? Do you want to book a cab? Do you want education? Do you want to buy? Do you want to travel? Everything will eventually be in the app.
   
   We want to simplify the lives of Indian consumers today. Indian consumers have to use ten different apps to do these ten things. Instead, this superapp will have everything in one place. More importantly, these are already touchpoints for 150M across India with the TataGroup today and we’re making this more convenient and bringing them all together.
2. Instant access across 100s of products and services that enable every aspect of life
   Harnessing the power of data & AI to create compelling daily experiences for 150 million consumers
   We want our consumers to find relevant products faster, easier and in a seamless manner. Having so many brands under one umbrella becomes meaningful.
   
   We felt the only way we could do this was through data. This was way back in 2019 when we started the journey.
   
   Our single goal was to harmonize all this data. We were very clear that if we can do this at scale properly and use AI models, our chances of being more relevant to the consumer are much higher. And that, to me, was one of our biggest successes.

How does Tata Neu scale and grow?

We want to be the destination for every Indian consumer. In that journey, we will have to ensure that we have everything the Indian consumer needs for digital life today. We have product commerce or for their daily needs like food and grocery, electronics, fashion, and more. We will add newer things that are relevant, across travel, mobility, content, entertainment, and education.

The most important thing for our app is for people to enjoy the customer experience across brands, making TataNeu a habit for them.

We have three growth drivers: frequency, monetization, and scale.

Monetization is the obvious one. Frequency drivers, we only have to some extent today with food and grocery. We’re growing our drivers here over the next year. Many of these are being built as we speak. The third is scale drivers, which drive volume but is driven by comfort and a fantastic customer experience. An excellent example of this is electronics and fashion, which deliver at scale for us. The combination of scale, monetization, and frequency drivers is how we see our strategy for growth in the coming year. 

Conclusion

That is the never-before-heard story of Tata Neu, India’s first superapp, in the words of the CEO. We are excited to witness and partner in this journey and honored to have had him at our first edition of REBUILD’22 at Chennai.

Stay tuned for more such stories from trailblazers across industries.