Digging deeper into the ambition of "airasia SuperApp" in Indonesia

AirAsia started with an idea to provide an affordable mode of air travel for all; and drive the travel industry in Asia. Business started with 2 aircraft, serving 6 routes in Malaysia in January 2022.

20 years later, that dream has spawned millions of new ideas that have successfully supported the company's business growth. AirAsia has now developed into an airline serving more than 128 destinations in 21 countries. Not only that, his business has now penetrated the digital world, providing all travel and tourism needs in one application called "airasia SuperApp".

Airasia's digital transformation has started since its inception in 2002 by introducing services online booking through the official website. Then, carry out regional expansion to several neighboring countries, including Indonesia. AirAsia Indonesia was launched in 2005, when there were 16 million internet users in the country.

A decade on, developments in internet technology have also accelerated democratization in various industries, including travel. Previously, society still depended on travel agent to organize their schedule, attendance OTA (Online Travel Agent) allowing individuals to be able to organize their own travel plans. Some well-known players include Traveloka, Tiket.com, Pegipegi, and a number of others.

The Covid-19 pandemic has impacted all industries in the world, travel and tourism being among the most severe. Restrictions on interaction require people not to travel. As a result, a number of flights were cancelled, accommodation providers found it difficult because the rooms were not filled, as were the facilities ride hailing which is empty of passengers.

Instead of sitting quietly lamenting losses and giving up on the situation, this airline is trying to get up by maximizing its digital potential. It cannot be denied that the pandemic has become a catalyst for consumers to migrate to digital platforms. The company sees this as a great opportunity to continue its digital transformation to the end, starting with SuperApp.

airasia SuperApp Indonesia

This super app initiative started in Malaysia, offering more than 15 types of products and services under three main pillars, viz travel, e-commerce, and fintech with airasia rewards, unlimited, and airasia pocket as a common thread that ties the entire ecosystem into one whole.

In the space of a year, the super app has grown phenomenally, not only enhancing its product and service offerings to become a travel and lifestyle app, but also its user base and traction in terms of transaction volume and value. One by one, these services began to expand.

In April 2022, the company appointed Delly Nugraha, who previously served as CEO of Carsome Indonesia, to lead the execution strategy for AirAsia SuperApp Indonesia. Recently, DailySocial.id given the opportunity to discuss with Delly regarding the development of this super application in Indonesia.

Delly admitted that basically the development of this super application was made possible by the company's technology. "In the past, because not many people dared to try, there were always some Resistance. Now, there are already a lot of drivers. The development of the internet is becoming more sophisticated, the reach is wider. We also have history as a company airlines successful. It only makes sense to develop this superapp, and we are optimistic to grow bigger."

Even though it hasn't officially launched yet, Indonesian people can already use the AirAsia SuperApp service on a limited basis. In the application, there are 4 categories offered, namely Travel, Delivery, Money and Play. Like OTAs in general, this service offers an affordable and planned travel experience. Starting from booking plane tickets, hotels, to economical holiday packages.

Beyond travel, airasia SuperApp also features other digital services, including fintech. In March 2022, service marketplace financial product airasia Money inaugurated their operations in Indonesia, offering affordable financial solutions, from insurance, investment, money transfers, and social fundraising, together with partners.

Next, in categories delivered, food delivery service airasia Food which was launched in the same month, further expanded its reach in several areas such as Tangerang, West Java, followed by Jakarta in June. Currently, for food delivery fleets, the company partners with delivery business lines Gojek (now GoTo), GoSend.

Airasia's involvement with Gojek not only that. Previously, airasia had acquire 100% business operations ride hailing and fintech Gojek in Thailand with a value of $50 million or around 700 billion Rupiah. On that occasion, Tony and Kevin touched on the potential for further joint partnerships without specifying the details.

In providing this solution, the company collaborates with partners. For example, PasarPolis (insurtech), Bareksa (e-investing), Rumah Zakat (social institution), and Wise (remittance) for airasia Money. Then, in the Play together category TrueID to provide content streaming audio, video and themed articles travel, food, and lifestyle which can be accessed for free.

Regarding development super app Delly also emphasized that the company's DNA is in the travel business. Through digital transformation, AirAsia tries to reach all related business lines, and will ultimately complement the core business. superapp present as value added business for airasia aviation business.

"Apart from that, we see potential cross-selling which is very big in this industry. One travel plan can involve various activities, starting from ticket reservations, accommodation, recreation and others. "By providing these options on one platform, we are confident that we can support SuperApp's future performance," he said.

Challenges and opportunities

At least four services offered through AirAsia SuperApp already have their own competitors in the Indonesian market. In terms of food delivery, the duopoly of GoFood and GrabFood will be a challenge for new players in this industry.

One of the OTAs unicorn, Traveloka, try your luck with the TravelokaEats service. Approaching two years of existence, the company must be willing closing this line of business for reasons of efficiency as of October 31 2022. One that is still surviving is ShopeeFood, as well as several restaurant food delivery services.

Delly does not see the existence of these services as competition. SuperApp positions itself as a complement to the existing ecosystem. "From the side ride hailing, we don't dream of beating Gojek or Grab. However, how market We can reach those who haven't been educated and haven't become an active market. We prioritize collaboration.

Collaboration in this case is not interpreted as competition within. "We support GoSend to develop a more massive business, automatically the scope of expansion will also increase. Our objective of delivering food to our consumers has also been achieved. The principle of collaboration is prioritized over competition," stressed Delly.

As an entity based in Malaysia, Delly also recognizes the differences in market conditions in the center and expansion areas. In Malaysia itself there are none ride hailing motorbikes like in the country. According to him, apart from regulatory reasons, the characteristics of the country and population also do not support the existence of motorbike taxi services online.

In Indonesia, service ride hailing AirAsia is reported to soon be paving the way in the country's tourism center, Bali. Regarding the fleet, Delly revealed that the company will work with partners who already have permits. This refers to government regulations which require companies to have a license to be able to operate this business.

With quite diverse business lines, the company admits that its expansion strategy will also be different. “Ride-hailing came after food delivery, because our strategy is very much based on current market conditions and also the behavior of the consumers we are targeting. "The expansion depends on what we want to achieve," concluded Delly.

Delly also revealed that the complexity of this business is influenced by various aspects, such as resource and financial adequacy. Airasia saw this very well and prepared everything necessary to be able to drive the business.

"We have the resources, we have the technology, we have it supply and capital. "I see that the basic factors for a corporation to take action to build a startup and create an ecosystem have been taken into account," said Delly.

In terms of capital, Airasia SuperApp Indonesia is still receiving internal induction from the parent company which was announced at the beginning of this year rebranding to become Capital A. Apart from that, the company is also reportedly in the process of raising funds and plans to be listed on the New York Stock Exchange next year.

In 2021, airasia SuperApp was recognized by Credit Suisse as one of the top three unicorn in Malaysia, with an estimated value of more than $1 billion. This was successfully achieved through product/service innovation on-demand offered, including four new products that have been added to the platform to expand its business lines.

When asked about targets, his party still did not want to reveal specific figures. Currently the company is still focused on developing SuperApp with the aim of providing added value not only for industry players but also consumers in every line of business offered.

"We provide this added value to complete the travel ecosystem. That is what we want to achieve. Then, the Indonesian market in general is still very large and has not been fully exploited optimally. There are still opportunities geographically, services, as well as in terms of consumer behavior," he concluded.