Background of GRAB

Today, e-hailing services are among the patron preferences because it makes it easier for

users to create reservations just by using their smartphone application. One example of
a widely used e-hailing service in geographical region is Grab. Law Insider defines e-hailing
as an automobile with a spaciousness of 4 persons and not exceeding eleven
persons, including the driving force, used for the carriage of persons on any journey, taking
into consideration single or different fares for every journey, where the arrangement,
reservation or transaction and therefore the fare for that journey are made simpler through
means of an electronic mobile application supplied by an intermediate means of transport
(Laws of Malaysia, 2017). As technology advances, e-hailing not only stands as a
transportation solution but also expands into a bigger landscape including online
payments and also the creation of intensive employment through food services furthermore as
shaping a more developed lifestyle and economy.
By 2020, e-hailing users are 17.9 million akin to 16.4% of users in geographic area.
This number is estimated to extend every year and by 2025 it targets a rise of
18.8 million users. this means that within the future, consumers are more likely to use e-
hailing services since they not only offer transportation services but also provide food
delivery services, online goods delivery, and online bill payment. this could indirectly
simplify user’s everyday life, especially busy workers and university students. Research
points to many measurable advantages of the services, like low waiting times and
reduced commute-related stress, cost-effectiveness over other modes, and congestion
and mitigation particularly for the shared-ride options (Etminani & Hamidi, 2019). The
success of this e-hailing service shows a positive trend within the development of a rustic.
It is highly beneficial to society moreover as national development.
Grab now operates within the Southeast Asian countries of Singapore, Malaysia, Cambodia,
Indonesia, Myanmar, Philippines, Thailand, and Vietnam, and therefore the East Asian
nation of Japan. in line with Zervas, Proserpio, and Byers (2017), several sharing platforms
have emerged enabling individuals to share goods and services like cars, household products,
and services. Grab has unique types of services include car services and food delivery. Grab
car is one of the transportation that carries passengers from one place to another place. Grab
car is to cater to every passenger’s needs. There are several requirements accepted as Grab
such as the car model, and the driver’s performance. The car models that will be rejected
include Perodua Kelisa, Perodua Viva, Perodua Kancil, Perodua Kembara, Perodua Kenari,

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Inokom Atos (Old model 2007-2010), Inokom Matrix, Renault Kangoo, Proton Wira, Proton
Iswara, Proton Gen 2, Proton Savvy, Proton Satria Neo (2 Doors), Proton Waja (Only
rejected in Sabah), Kia Spectra/Naza Spectra, Kia Sutera/Naza Sutera, Kia Picanto/Naza
Picanto(Old model 2007-2010), Honda CR-Z (2 Doors), Hyundai Getz (Old model 2007-
2010), Hyundai i10 (Old model 2007-2010), Chevrolet Aveo (Old model 2007-2010),
Changan Era CM8, Pick-up trucks (Only rejected in West Malaysia), 2 Doors Vehicles, and
Taxi vehicles / Personal Advertised vehicles. Grab will accept the car models that do not
include in the rejected cars list. Grab only accept the vehicles that manufactured less than 9
years until further notice from the relevant parties. Existing driver-partners may also continue
with their current registered vehicles until further notice. Grab is a fixed-fare on-demand
service that a passenger books a grab car will be assigned the nearest vehicle. The minimum
fare for Grab car is RM5, the base fare is RM2, RM0.70 per km and RM0.20 per minute.
Moreover, GrabFood is to deliver the food to satisfy the customer’s needs. GrabFood is
available in Klang Valley and has recently expanded to selected areas in Melaka, Kota
Kinabalu, Penang, Johor, and Kuching. GrabFood delivers at 9 am and runs as late as 12 am.
The price is the order’s total cost which includes the price of the menu items and a delivery
fee.

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SWOT Analysis

The Swot Analysis above reflects that Grab has established a strong brand recognition across
South-East Asia, with a diversity of transportation services provided to the application users.
Grab has successfully differentiated itself from its competitors with a high quality of service
standards and user-friendly technology that consumers find easy to use, even for the elderly.
However, Grab is heavily dependent on its developers to resolve any technical glitches which
Grab should seek opportunities to improve to avoid any unnecessary dispute. Grab should
also focus on mitigating the threats that are faced, especially those such as pricing strategies
and branding equity to reduce potential threats. Grab will then be able to utilize their
resources and make good use of the opportunities to expand their business as well as increase
Grab’s brand awareness, in preparation to enter the global market.

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PEST Analysis

PEST Analysis (F. Aguilar, 1967) is a framework that is used to analyze the macroeconomic
environment

PEST Analysis (F. Aguilar, 1967) is a framework that is used to analyze the macroeconomic
environment with four main factors namely political, economic, social-cultural, and
technological. As analyzed above, we have identified the variables of the individual PEST
factors that has an impact on Grab car Singapore (H Ha, K Coghill, 2006).

The political stability of Singapore is essential as it affects the sustainability (TN Gladwin,
TS Krause, 1995) of Grab as well as the formulation of government policies towards the
industry with fairness and equity. This leads to the impact on the economy on Singapore’s
GDP level with the contribution of Grab in boosting the transportation service industry, that
is highly sought for by the consumers of Singapore due to heavy traffic congestion and
convenience. However, for Grab to be favored and accepted by both the consumers and

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government, Grab have to seek opportunities in resolving the increased in the fleet of
vehicles that will impact the environment with carbon emission (M. Lin, C. Dula, 2016). In
addition, Singapore is referred as the world top R&D center (CS. Yue, JJ. Lim, 2003) which
gives Grab the benefit of easily accessible resources and reliable infrastructure to conduct
extensive R&D to improve and provide the company’s cutting-edge technologies that will
fight against the odds and penetrate into the global markets.

2. GRAB – Customer loyalty

2.1 Definition of loyalty

Loyalty is a firmly held commitment to purchase or re-support a chosen product or service in

the future, despite the fact that the effect of the circumstances and marketing efforts may
drive customers to switch. Customer loyalty is defined as a customer's commitment to a
product or service, as evidenced by recurring purchases, the quantity of purchases in the
present and future, and a degree of acceptance that differs from rival products or services
(Kotler & Keller, 2015). Repeat purchases, utilising line items, referring to others, and being
immune to rival offers are all indicators of customer loyalty (Griffin J, 2016).

Customer loyalty is influenced by factors such as physical evidence/facilities, location,

product and customer satisfaction (Farida et al., 2016), Perceived Value and customer
satisfaction (Putri et al., 2018), Customer Relationship Management, and customer
satisfaction E-Service Quality, customer trust and satisfaction (Berlianto, 2017), service
quality and price (Sugiarsih Duki Saputri, 2019), promotion and consumer satisfaction (Jati
Prabowo & Sitio, 2020).

2.2 Factors that influence GRAB customer’s loyalty

2.2.1 Affordable and Convenient

Today, Grab has become Southeast Asia’s largest mobile technology company connecting
millions of consumers to millions of drivers, merchants, and businesses. Most of the
popularly known Grab service is Grab Car. Usually, customers always use the Grab Car as
their favorite transportation to go to their destination. It is easy for users to use the service by
just clicking on their mobile apps and waiting for the drivers to pick them up. Users can make

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payments by cash or Grab Pay to the drivers to choose them up. Users can make payments by
cash or Grab Pay.

Food is also available through Grab. People nowadays are so busy working that they don't
have time to go out and get meals, so they order them online. Grab Food provides cuisines
from over a thousand eateries. Users may utilise the service to order their favourite cuisine
from local eateries and make orders via the website or mobile app. To order their meals, the
consumer can pick their preferred eatery. The rider will deliver the user's food as soon as they
place their order. Users can score the rider's service with a star and write a remark indicating
whether or not they are happy. In addition, Grab offers bill payment services. Users may pay
their bills through the Grab Apps instead of going outside and queuing at the counter. This
can save both time and energy. Users may also order deliveries through Grab. Users may
simply place an order using the Grab Apps. Grab will handle the order and send it
immediately to the store. As a result, this will make it easier to shop for anything without
leaving the house. All of the services were linked to Grab's aim of assisting in the resolution
of more people's issues.

2.2.2 Points incentives for discount

Grab also provides rewards and subscriptions to build customer loyalty. It offers points every
time customers spend money on the apps. This will increase customer satisfaction. For
instance, if you use Garb Car services, you will automatically receive some points after you
pay for the services. They could claim their rewards by collecting points that can be
redeemed with entertainment, food and beverage, services, grab, shopping, and travel, after
using Grab services. The subscriptions allow users to get voucher packs to save on their
everyday needs. This will increase customer satisfaction.

2.2.3 Good Customer service

Great customer service can help to attract new customers, as well as encourage existing

customers to remain loyal. Offering a contact phone number and email address is a must for
most businesses. In addition, Grab provides an extra platform called live chat, which gives
clients rapid replies. Customers have varied expectations, therefore it's a good idea to set
expectations about when they should anticipate replies.

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3.0 Marketing Strategies

Social Media marketing

Social media platforms such as Facebook, Instagram, and Tiktok can increase brand
awareness. Grab's visual and audio concepts in social media can make people more interested
in using the services. Besides that, Grab also uses various advertising platforms such as
newspapers, 80 television commercials, and sponsorship in entertainment programs to attract
customers' attention.

Cost, quality, flexibility, and dependability

Grab has the same average price as other e-hailing services. What differentiates Grab from
other ehailing services is the quality. Grab car drivers are especially emphasized to always
maintain quality standards in serving customers. Customers prefer friendly and efficient
drivers. Grab is highly concerned with drivers with such criteria to ensure users' satisfaction.

Research and Development (R&D) as a differentiator

Grab opens its seventh R&D center in Kuala Lumpur, underlining its commitment to
nurturing deep tech talents in Southeast Asia. Grab plans to hire hundred tech employees,
such as data analysts and software engineers, for the R&D center in its first-year operation to
ensure a company's innovation and to introduce a new product or service.

Hyper-localization

Grab creates content based on unique knowledge, right down to the area and community,
analyzing how the shoppers are searching and purchasing any items they want. Besides,
hyper-localization can take many forms and is necessary to make Grab have a significant
competitive advantage. key local variants of Grab jump in each market. For example, there is
GrabTukTuk and GrabRemorque in Cambodia and also GrabTrike in the Philippines which
reflect locally popular modes of transport

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3.1 Industrial Analysis

Porter’s Five Forces

Threat of New Entrant (Low)

Threat of new entrant is low for Grab due to its outstanding technology used to facilitate the
booking of Grab cars but also the premium service with ethical values that has appealed to
the consumers, as well as loyalty programs to retain loyal customers.

Bargaining Power of Suppliers (Moderate)

In order for Grab car to operate smoothly with little or no hiccups, the developers have to
constantly upgrade the system to fix bugs and to improve the speed and functionality of the
application with the addition of many other services

Intensity of Rivalry (High)

Over the years the use of technology in facilitating the booking of transports have been rather
popular with the success seen from Grab with over 4 million downloads of the applications,
550,000 active users per month and, 8 bookings per second.

Threats of Substitute Products (Moderate)

If Grab fails to keep up with the technology and the branding of its company, it will allow its
competitor to have the chance to substitute the application with strategies as well as attractive
pricing.

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Bargaining Power of Consumers (Low)

There is a consumer sensitivity cost for Grab as they are constantly in search for the cheapest
price

4.0 IMPROVEMENTS

To compete with a wide enough market, Grab companies require creativity and innovation in
creating products and ability to maintain consistency in supporting product quality. One of
the problems that Grab and Gojek are facing is pick-up points. This can be an opportunity for
Grab. The download can upgrade map quality on Google Map so pickup is more accurate
than Gojek application. In line with being consistent with the quality of the product, they
must also be consistent with the price given. Price is one factor that is highly favored by
consumers. However, consumers could experience a drastic price increase. To resolve this
problem, Fetch can set the tariff provided.

Consistency

Grab is expected to settle consistently with the quality of its products. Not only consistent in
their products but also with the prices given. This is the same problem faced by Gojek, but if
Grab can be more consistent by presenting consistent prices to passengers, this will be an
advantage. Grab should also pay attention to the consistency of the number of drivers and
passengers, train or find more drivers to ensure the probability of successful travel. Grab
should also make a corresponding cost assessment and budget including the driver training
costs and other travel costs.

Service Quality

Besides maintaining product consistency, Grab should improve service quality. One of the
services that customers want is fast-responding customer service. Good service does not only
come from Grab companies but also the drivers. The problem that is regularly faced by
consumers is the driver. Poor attitude and lack of knowledge of finding the trip route is the
problem. Grab should improve the system and the applicable SOP, so it can be very useful for
drivers and passengers. If the company cannot offer a lower price, then the company can
provide good service to its customers, which is a competitive advantage.Grab should always
maintain its quality and brand image to capture positive customer perceptions to gain a

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competitive advantage. Other companies like Gojek, Lyft, and Uber have the same aim, but
trust and perceived risks are still issues in Indonesia's online transportation services. Thus,
Grab being the no 1 brand should rectify this soon to maintain their ranking.

Product Differentiation

Another competitive advantage is product differentiation. With the uniqueness that exists in
the product, it will be very easy for consumers to move from other products to the products
we have. One of the efforts that Grab has taken is to create a Grab Gerak (which exists in
Indonesia) intended for people with disabilities. A very good innovation from Grab and not
owned by the Gojek company. The innovations that Grab can do are like the Bajaj Grab,
where the delivery service uses Bajaj, which will be very useful for delivering people who
have just finished shopping from the market. It will help the local people and can improve
their economy.The company must provide the uniqueness of products to drive the consumers’
choice. If Grab makes Bajaj Grab, it will facilitate the community in the markets. It is easier
for passengers to carry a lot of luggage and helps the Bajaj drivers attune to technological
developments.

5.0 DISCUSSION AND RECOMMENDATIONS

After a competitive advantage, the steps the company must take is to do the marketing. So far
the quality of marketing that Grab has done is only limited to reminders. The message given
is only about Grab - passengers - and Grab services and looks less attractive. It would be
more interesting if Grab used a theme that was trending on the Internet, such as the theme of
Avengers or even the Joker. Thus, advertising will be more interesting. The more themes that
are adapted both from existing films and stories, the easier for companies to hook on existing
customers.

Grab should improve the Telematics apps, which are a combination of machine learning and
predictive analytics. This app can identify unsafe driving habits or any problems that come
from vehicles.Grab should also fix the price to make sure the customers will not choose other
competitors such as Gojek and Mula.

Providing users with secure and safe rides. Grab should make sure the customers feel safe
and trust the drivers by showing the driver’s details such as name, phone number, and plate
number.

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Provide more flexible payment methods such as cash, credit card payment, GrabPay (OVO),
E-Wallets, and online banking. As a result, customers can pay the fare more easily and
quickly.

The drivers should be trained to improve their communication skills so that the customers
will feel comfortable riding with them. Effective communication makes the customer more
relaxed and more appealing to use the services.

After all, aspects already exist, the company only needs to expand marketing reach. Grab
companies are active in ASEAN only, and it will be if Grab can also operate in the ASIA
region. Then a lot of marketing teams are needed and sufficient. Grab must cooperate and
establish relationships with several countries in ASIA so that Grab’s products can be
accepted in the community. It should be underlined, that not all countries in ASIA must be
lectured because there are several factors such as economic conditions, government
regulations, technology, and social conditions in the country. If all aspects are beneficial as is,
formerly Grab can carry out executions in the country.

CONCLUSION

In conclusion, Grab is a popular and convenient mode of transportation. It has developed

abroad and become one of the most outstanding startups in South-East Asia. Besides, it has
also become one of Malaysia's biggest e-hailing businesses, competing with MULA, and
MyCar. This assignment found many key success factors of Grab's success. In this new era
with a lot of technological advancement, Grab has mastered a super App, which includes
many services, such as transportation, paying bills, and food ordering, easier to use anytime
and anywhere. Also, Grab gives a lot of rewards and subscription benefits to attract and
maintain user's loyalty. Users can redeem the reward points after using Grab services. Users
will have an opportunity to get a voucher pack to save on their daily needs, and it can be used
anytime they want before the due date. Furthermore, most of the respondents stated that
Research and Development (R&D) as a differentiator is another key success factor. Every
company must take this activity as their first step to introduce their new products or services
in the market. They also need to practice hyper-localization as a significant competitive
advantage. By practicing this factor, they should listen to what the majority prefer their
companies over others. The fifth key success is marketing strategies to promote their
services, to monitor and directly communicate with their consumer's satisfaction. Finally, we

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underlined cost, quality, flexibility, and dependability are the other essential success factors.
Grab always considers ensuring user satisfaction with the affordable cost and the highest
quality performance compared to other e-hailing services. Grab also provides flexibility with
cashless payment.

(3284 words)

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