Final Case PBCC

Final Case PBCC

Preface
Grab is one of the companies that is known as a “Super App”. Standing tall in the
region of Southeast Asia, Grab had been crowned as the very first start-up that
attained the title of Decacorn – a business that possess the valuation of more than
US$10 billion. Being a Decacorn is not a simple feat, for there are merely less than 20
start-ups in the world that is worthy of being called as a Decacorn.

As most of the start-ups, Grab started small. A few years ago, Grab is only a taxi
ordering service that operated in one country, however, under the status quo, Grab
had now operated in 339 cities across 8 countries, facilitating more than 3 billion rides,
helping at least 9 million micro-level business, and grasping approximately 70% and
60% market share of car and bike ride-hailing service respectively in Indonesia.

What make Grab particularly special is that it doesn’t merely achieved the nigh-
impossible feat of being a Decacorn through an aggressive means of profit gathering,
rather, it also empowers the stakeholders behind it, which was proven by the fact that
Grab helps their driver partner to increase their welfare by facilitating them to get a
relatively higher income. Statistically, 90% of the Grab drivers earn more than the
minimum wage level, and that is an amazing achievement in its own way. Not only
that, Grab also empowers more than 5 millions entrepreneur of micro-level across
Indonesia through the use of their features, namely, GrabFood, GrabBike, Grab Car,
Grab Express, Grab Rent, etc.
Condition
As of now, GrabBike is currently facing a number of problems:

Promotion and Budget Constriction

Under the status quo, promotion has a big influence to the demand of GrabBike’s
service. The more promo they offer, the cheaper customers pay for the service, hence,
in accordance to the well-known principle of price-demand relationship, it affects the
number of GrabBike demand. However, the problem that Grab faced recently is that
there exists a budget constriction for offering a promotion. And yet, there is a ‘rule of
thumb’ in Grab, that is, every drop of Rp 500 on promo per ride will lessen the number
of rides by 5%.

Competitor give high amount of targeted promo and lower pricing

Another thing that became a problem for GrabBike is that, under the aforementioned
situation -- the existence of budget constriction for ride promotions, the competitor still
provide a high amount of targeted promo and gives lower pricing to the prospective
customers, hence, it became a threat for GrabBike.

Stagnant Performance in University Area

Grab market targets adjust to crowded areas that require transportation services while
also take account at the consumer behavior within. The campus area is an ideal place
for grab, due to the fact that many students need access to transportation and their
habits are generally often dependent on others. However, the performance in these
areas had begun to stagnate.

Declining GrabBike Demand in Rainy Season and Holiday Season

When the rainy season came in the areas in which GrabBike operates, the demand
has the trend to decline, since the customers would rather stay home or uses another
means of transformation when it was rainy. Not only when it is rainy season, the
demand of GrabBike also declines, as the students, who are one of the main
customers of GrabBike are on vacation.
Challenge of the case
With all of the aforesaid conditions in Grab, the objective of this case from Grab is how
to make people keep using Grab’s product instead of Grab’s competitor on Q4 (Oct-
Dec) under the conditions of no promotions, rainy & holiday season, and there exist
competitors’s initiative such as high promo amount to targeted user and intensive
promo communication. What would Grab do to improve revenue performance during
Q4 against their competitor?

Note : Revenue for Grab comes from 20% commision of fare per trip-also the same
for competitors.

The indicators of success is 20% increment of Grabbike user at the end of the period,
25% increment of Revenue at the end of the period, and also low to zero promo rides.

Your Team must choose which university that your team prefer to focus on, with your
brief explanation on why your team chose it. What kind of end-to-end strategy would
you do to improve performance in the chosen university, achieve the objective, and
achieve the success metrics with these set of plans :

1. Detail on initiative/campaign/strategy/feature to win the market with

characteristics such as feasible to be executed fast, cost efficient, impactful,
unique and creative, and fit with the local needs
2. Projected number of all metrics in a monthly period through October -
December 2019
3. Overall budget costs needed for any marketing/strategic activities you are
planning to do in a monthly period - also create weekly timeline if any
marketing/strategic activities are planned
4. Rainy season is coming. Make a special segment where you explain on how to
address this issue - in correlation with you initiative

In addition, what do your team think is a potential market that GrabBike can tap
into outside of students as a market, also elaborate on what kind of activity you would
do to acquire the new market
Appendix :

Monthly Active User :

Definition: Total number of Grab passengers who at least completed 1 ride in a month

Monthly Active Driver :

Definition: Total number of Grab drivers who at least completed 1 ride in a month

Number of demand :
Definition: Numbers of attempted bookings that is created by passenger Formula: 1
active user is assumed to take 2 rides per 1 working day

Cancelation Rate :
Definition: Rate of allocated number of demand being cancelled by driver per total
number of demand

Promo per Ride :

Definition: Total promo spent per total rides on certain period of time

Rides that use promo :

Definition: Total number of completed rides that use promo

Total Rides :
Definition: Total number of completed rides (Promo and Non-promo) Formula: Number
of demand - cancelled rides

Fare per Ride :

Definition: Rate of total fare per total rides in a month

Revenue per Ride :

Definition: Rate of total commissions that Grab takes per total rides in a month
Formula: 20% out of fare per ride in that month
Revenue (IDR) :
Definition: Revenue for Grab comes from 20% commission of fare per trip - also the
same for competitors.

Condition & Character :

University A
● Ambitious & Competitive

● Academic centric

● Individualistic

● Anti mainstream

● Active (join organization/ community / social activity)

● the location of the campus is in city inner, close to many hang out places.
many students prefer to study in hang out place.

● Price sensitive

● For students who come from other town , mostly use public / online
transportation

University B
● Inclusive

● Active (join organization/ community / social activity)

● Ambitious yet friendly

● Many student came from other town

● The location of the campus is outside the town, far from the city. but have
many hangout spot for students around campus, usually open until midnight.
 ● Price Sensitive

● For students who come from other town , mostly use public / online
transportation

University C
● Exclusive

● Individualistic

● Update to new trend

● Some of them are active (join organization/ community/ social activity)

● Focus on their own personal brand & pride

● the location of the campus is still inside the city but far from the center of the
city.

● Mostly use private vehicle

EXHIBIT

http://bit.ly/EXHIBITGRAB