It would have been a surprise if Tata Sons, under the chairmanship of the former TCS CEO, did not make a digital splash. One of the big announcements under Chandra came in the form of the “Super App”, that would be the digital interface of the Tata group.
What is Super App all about?
The Tata Super App is proposed as a digital ecosystem what would provide a comprehensive ecommerce platform for all the consumer facing businesses. This will encompass Tata Capital, Titan, Tata Consumer, Trent, and a host of other consumer facing businesses that are currently part of other group companies. It would not only help the Tata group leverage the benefits of its digital skills, but also position the group as a forward looking and fleet-footed business.
Taking on digital competition
The Tata Group also realizes that other players like Amazon, Wal-Mart and even Reliance Industries have already made significant forays in the digital realm. In fact, Reliance is even going as far as creating the digital ecosystem for the full retail chain. Tatas have strong brand tremendous recall value in the Indian markets. What they really needed was a good and solid digital platform which can showcase and facilitate transactions in the complete spectrum of consumer facing products and services that the Tata Group offers to the consumers.
Big Basket is a start
In a recent deal, the Tata group paid $1.5 billion for 68% stake in Big Basket which values the ecommerce start-up at $2 billion. The rally in the stock markets in the last one year has given a lot of stock currency to the group to make strategic buys. Big Basket specializes in fresh product delivery and focuses on perishables only. For the Tatas the intent is to capture as many occasions of the consumer during the day as is possible. From that perspective, the Big Basket acquisition may just be a start and they may look at more aggressive inorganic buys in the coming months. If that does happen, then the ecommerce ecosystem in India would get evenly distributed across four major players.
Right place and right time
From that perspective, N Chandrasekhar with his formidable legacy at TCS will be the man in the right place at the right time. TCS derives over 40% of annual revenues from the digital business and it is only logical that they would be best poised to manage the transition from a brick-and-mortal player to a substantial digital player. For a long time, the Tatas have run a set of discrete businesses with a common DNA. It is now the right time to integrate all these disparate sets of businesses under the Super App umbrella. Big Basket may be the start and Chandra may be the man; so, we can expect exciting times from Tatas!