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MUHAMMAD NAJMI QAYYUM BIN
B2201272
AMRIL
SHOKI YAMASHIARO B2100252

CHAI MIN YANG B2201364

RYUKI NISHIYAMA B2100721

MOE MIN THEIN B2201384

AZEEM BIN AHMAD TARMIZI B2201613

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Module/Subject Code MKT101
Module/Subject Name PRINCIPLE OF MARKETING
MR. DEVARAJ A/L
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KANAGARAJOO
Due Date 5 APRIL 2023
Assignment Title/Topic MKT101 GROUP ASSIGNMENT
Intake (where applicable) JANUARY 2023

Word Count 4130 Date/Time

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 Table Of Contents

Section 1: Introduction ………………………………………………………………. 1

Section 2: SWOT Analysis …………………………………………………………... 2

Section 3: Segmentation, Targeting & Positioning Strategy ………………………. 6

Section 4: Planning the Marketing Mix (4Ps) Strategies ………………………….. 10

Conclusion ……………………………………………………………………………. 14

References …………………………………………………………………………….. 15

Originality Report ……………………………………………………………………. 18

 1

Section 1: Introduction

The Malaysian food and beverage market has reported a high growth rate due to the
country's population increase, positive changes in product innovations, and rising disposable
income (Abd Aziz et al., 2021). In addition, the strong growth in the food and beverage market
has been associated with the increasing number of restaurants in the country, food delivery
apps, and fast-food chains, among others.

The company selected for this discussion is Grab company. Grab company is
associated with developing the Grab super-app, which provides customers with transportation,
digital payment services, and food delivery. The company has expanded in the domestic and
global markets, becoming a one-stop shop for transportation, logistics, hotel bookings and
financial services. Grab operates in many cities across eight countries in Southeast Asia,
including Singapore, Indonesia, Malaysia, and the Philippines. Grab’s mission is to improve
the quality of life for Southeast Asians by providing accessible and affordable services
(Pradhan, 2019). Overall, the company has rapidly become an essential part of daily life for
millions in the region hailing its services to exponential growth.

The key objective of this paper is to carry out an analysis of the company’s business
environment showing its current market situation for its product and service through a SWOT
analysis. The paper will also analyze the company's segmentation, targeting, and overall
positioning strategy and compare its product with its direct competitors. Additionally, the paper
will discuss Grab's marketing mix strategies for its product in Malaysia, showing its product
characteristics, pricing, distribution, and promotional strategies.
 2

Section 2: SWOT Analysis

In this section, GrabFood’s current market situation will be briefly analysed, followed
by an extensive SWOT analysis of GrabFood.

Current Market Analysis

Currently, GrabFood’s target market is the demographics of 18-60, which include

students, workers, to retirees of the upper and middle classes. GrabFood is currently available
in selected major cities in every state in Malaysia. Major competitors of GrabFood include
Foodpanda and Shopeefood. (Uppaluri S, 2019)

SWOT Analysis

A SWOT (Strengths, weaknesses, opportunities, threats) is a guide for organisations to

determine their strengths and weaknesses as well as their broader opportunities and threats. A
SWOT analysis is generally used by organisations in strategic planning and decision-making
processes. (Val Renault,n.d.).

Strengths

1. Brand Recognition

Firstly, GrabFood has a number of strengths, of which its brand recognition is one of
GrabFood’s main strengths. GrabFood is a household name in Malaysia. It has a strong
presence in Malaysia attributed to many of its other strengths, including its positive customer
feedback, which shaped the growth of its customer base over the years. This was proven further
when GrabFood managed to top the food delivery industry in 2022, having a massive 60%
share of the $2.2 billion food delivery market in Malaysia, a significant improvement from the
previous year (Momentum Works, 2023).

2. Convenient Mobile App

Besides, GrabFood has a user-friendly and convenient mobile app. The GrabFood app
has a functional application design with many features to suit users’ convenience. Among the
features are being able to schedule their order and the option to self-collect the order. (Alanna
 3

Tan, 2020). Furthermore, the GrabFood app was merged into a single grab super app, with all
Grab services conveniently in one app (Grab, 2019). This convenient and multi-functional app
makes the user experience with GrabFood easier, thus maintaining the user base and even
growing it simultaneously.

3. Technological Infrastructure

GrabFood’s technological infrastructure also strengthens the service. Grab Food uses a
variety of technologies, such as data analytics, artificial intelligence and cloud kitchens, to
drive personalisation, food variety and localisation efforts to create the perfect experience for
users and merchant partners (Winston Zhang, 2020).

Weaknesses

1. Possible poor user experience

GrabFood has several weaknesses as well. For instance, there is the possibility of poor
user experience when using GrabFood. As food delivery can be very complex, mistakes from
every party are highly possible. For instance, a case study has shown that recurring problems
include additional hidden prices, promo-related problems, long or uncertain wait times for food
with no feedback from drivers and bad experiences with the order (Clara Felicia, 2022). This
may cause negative user base growth as existing users might switch to other food delivery
services.

2. Limited geographical coverage

Besides that, GrabFood has limited geographical coverage. Although GrabFood is the
leading food delivery market in Malaysia and Southeast Asia, GrabFood does not have a
presence in other regions worldwide. GrabFood does not have universal coverage, which could
hinder its growth potential.

3. Limited control over food quality

GrabFood cannot do much to control the quality and packaging of food from partner
merchants such as restaurants. Issues that are the restaurant's fault, such as impaired quality of
food, wrong order or failure to fulfil special requests, can only be directed to GrabFood’s app
customer services instead of the restaurant itself. As such, users may not know if the issue has
 4

been addressed by the restaurant or not (Clara Felicia,2022). This can cause mistrust towards
GrabFood from users.

Opportunities

1. Growing market

The food delivery market in Malaysia has been extensive and constantly growing over
the years. The Gross Merchandise Value of the industry in Malaysia was $2.2 Billion in 2022
and is expected to grow in the future (Momentum Works, 2023). Despite eased lockdown
restrictions, demand for food delivery services is still strong. Seven in ten respondents say that
deliveries are a large part of their lives today, which indicates that demand for food delivery
services will increase (Abirami Durai, 2023). Therefore, GrabFood has much room to expand
its operations.

2. Expansion to other markets

GrabFood is still yet to be available in many countries, including within South East
Asia. As the food delivery market is still nascent in Southeast Asia, there is still much potential
to grow and expand to countries such as Brunei and Laos. The opportunity to further expand
within Southeast Asia is vital for GrabFood to increase its brand awareness in the region.

3. Technological advancements

New technology is being developed and implemented constantly. GrabFood can use
technological advances to its benefit by improving its app design and adding new features.
Grab launched GrabMaps, which uses location-based intelligence and services to all Grab
services, including GrabFood, providing a better experience for users and partners while
enhancing efficiency and cost savings for businesses (Grab, 2020).

Threats

1. Slowing market growth

Despite continuous growth in the food delivery market, there is still a high possibility
for the food delivery market to decline in growth. In 2022, the food delivery industry only
recorded a 5% growth, much lesser than in previous years, attributed to easing covid
restrictions in Southeast Asia (Loh, 2022). A slower growing market is a threat to GrabFood’s
 5

profitability and potential expansion.

2. Competition

The food delivery industry is a highly competitive industry with many firms entering
the market with the goal to dominate the market. The main competitor firms such as Foodpanda
and shop food are constantly implementing new features to differentiate themselves from
GrabFood. Furthermore, there are many new food delivery services both local and regional
which have entered the market. These competitions pose a threat to GrabFood’s market
position, GrabFood has to constantly add new features to differentiate itself from the
competition.
 6

Section 3: Segmentation, targeting & positioning strategy

Segmentation Bases

Marketing segmentation is a marketing strategy whereby a target market is segregated

into smaller groups based on shared characteristics (Yieldify, 2022). Its goal is to identify
specific customer groups so that goods and branding can be tailored exclusively to the group's
preferences. In the context of GrabFood, the company could provide restaurant options and
food promotions according to these segmentations. Three segmentation bases identified to be
relevant to GrabFood in the context of the Malaysian market are:

1. Geographic Segmentation

Geographic segmentation implies that consumers are divided according to their

geographic location with the assumption that individuals within a particular region may have
comparable needs (Tarver, 2022). Even neighbouring geographic areas are somewhat different
from each other. For example, GrabFood segments customers according to states such as Kuala
Lumpur, Selangor, and Penang. The company also divides the customers regarding whether an
area is urban, suburban, or rural. Individuals from different regions may have varying culinary
traditions, food preferences, and popular cuisines, making it an essential component of the
company's marketing segmentation strategy. FoodPanda, being a direct competitor to
GrabFood, also utilises geographic segmentation. However, the specific strategies utilised by
FoodPanda differ in some ways compared to GrabFood. For example, GrabFood's coverage
area is broader than FoodPanda, and FoodPanda has a more substantial presence in certain
suburbs or smaller towns, while GrabFood is more common in major cities. With regard to
service radius, GrabFood covers between 7 to 10 km distance from the merchants, whereas
FoodPanda only delivers within a 5 km radius (Tan, 2021).

2. Psychographic Segmentation

Psychographic segmentation effectively categorises consumers based on internal traits

such as personalities, lifestyles, and beliefs (Karnes, 2022). This segmentation method is
considered the most complex as internal traits are subjective but considered the most valuable
(Yieldify, 2022). In this case, GrabFood classifies its customers regarding dietary preferences,
health consciousness, and convenience-seeking behaviour. Some consumers may favour fast
food over healthy food, whereas others prioritise vegetarian or Halal-certified options. Hence,
 7

GrabFood offers customisation options for customers to suit their unique requirements and
preferences for their orders. For example, customers get to customise their meals with extra
toppings or sauces and provide options for different portion sizes. Besides that, GrabFood
ensures halal and non-halal food deliveries are separate, which provides confidence in their
service to customers who are particular about the halal status of their food.

3. Behavioural Segmentation

Behavioural segmentation involves grouping consumers according to behaviours and

decision-making tendencies, such as purchasing and usage patterns (Qualtrics, n.d.). Future
consumer purchases may be predicted by analysing market data on prior interaction with the
market and goods as well as previous spending habits (Tarver, 2022). In terms of behavioural
segmentation, GrabFood customises its recommendations for each consumer based on
algorithms and data research. It considers a customer's previous orders, search history, and
ratings to recommend food options that match their preferences and tastes. For example, if a
customer regularly orders Thai food, GrabFood may recommend different Thai eateries or
dishes that the customer has yet to try before. Furthermore, GrabFood offers loyalty programs
and rewards to regular customers. For instance, GrabFood customers who use its service
frequently will receive points and vouchers, which in turn encourages them to continue utilising
its service and increase their order frequency.

Targeting Strategy

In this section, we will identify and discuss the targeting strategies of Grab Food in
Malaysia using marketing concepts.

One of the main strategies used by Grab Food is undifferentiated marketing. Grab Food
provides an easy way for customers to order their favourite foods, including a variety of
cuisines and restaurants, from the comfort of their homes or offices. This includes consumers
who want a wide variety of food at affordable prices and fast delivery, merchants who want to
increase sales by serving as many customers as possible, and finally, drivers who want to
maximise the number of deliveries and earn more revenue in a short timeframe (How GrabFood
Is Harnessing Technology to Overcome the Challenge of Food Delivery in Southeast Asia,
n.d.). Grab has an approach to reaching more customers by creating advertisements through
 8

social and other event campaigns, with the goal of helping customers from all walks of life
(Mustafa, 2021).

Grab Food also has a concentrated and individualised targeting strategy. Grab Food has
created marketing campaigns and service enhancements in specific areas, such as urban centres
and densely populated areas, to reach customers in those areas. Grab Food deployed technology
effectively, giving users the freedom and tools to customise their in-app experience. For
example, if a user searches for a particular dish or restaurant and does not come up, or if the
search returns fewer than four results, the system displays similar dishes on the menu. These
features allow the system to better understand a user's profile and create personalised listings
based on budget and culinary preferences (How GrabFood Is Harnessing Technology to
Overcome the Challenge of Food Delivery in Southeast Asia, n.d.).

In conclusion, Grab Food applies undifferentiated marketing to offer customers a

simple way to order a wide selection of affordable foods from various restaurants with quick
delivery. By concentrating on particular areas and using technology to customise users'
experiences, they also adopt focused and specific targeting strategies. Grab's strategy seeks to
assist clients from various walks of life and boost earnings for businesses and drivers.

Positioning Strategy

In this section, we will identify and discuss the positioning strategies in Grab Food in
Malaysia.
Grab Food is positioned as a fast, reliable, and convenient food delivery service through
its smartphone app, and Grab Food's competitors include other food delivery services such as
FoodPanda and Deliveroo (Uppaluri, 2019). Pricing is widely used to ward off competition and
companies often suffer losses for offering deals and discounts, but in Southeast Asia, the
market is in the early stages of development as most retail spending in the region is still done
offline. Therefore, companies have room to carve out market share, and since food delivery
apps tend to become mainstream in Southeast Asia in a relatively short period of time, these
companies will need speed and convenience (Choudhury, 2019).
Compared to these competitors, Grab Food has differentiated itself in various ways to
increase its market share. For example, it offers efficient food delivery through its app
development technology and data analysis, as well as a one-stop store for ordering, delivery,
 9

and payment using Grab Pay and other services, and it serves people of all ages by offering a
diverse selection of restaurants and cuisines to suit local tastes (Madhav, 2022).
In addition, Grab Food has a larger market share due to its brand recognition and
existing customer base gained through the operation of multi-services such as Grab Cab and
Grab Mart, which gives it a competitive advantage over its more established competitors
(Madhav, 2022).
To summarise, Grab Food differentiates itself from competitors such as Foodpanda and
Deliveroo with its fast, reliable, and convenient smartphone app. Grab Food is growing its
market share by offering efficient food delivery technology and a one-stop store for ordering,
delivery, and payment. It also offers a diverse range of restaurants and cuisines and benefits
from brand recognition and existing customer base from its other multi-service operations such
as Grab cab and Grab mart.
 10

Section 4: Planning the Marketing Mix (4Ps) Strategies

As part of an all-encompassing marketing strategy, a marketing mix structure is used

to focus on a variety of topics (Kenton, 2023). The phrase frequently alludes to a popular
division that was first known as the four Ps, or product, pricing, placement, and promotion
(Kenton, 2023). Businesses may develop a comprehensive marketing mix that successfully
communicates the value proposition of their product, reaches their target audience, and
ultimately boosts sales by considering the 4Ps of marketing (Kenton, 2023). The marketing
mix can also be modified and tailored in response to market fluctuations, client demands, or
corporate goals (Kenton, 2023). In this section, we're going to talk about Grab Food's marketing
mix strategies.

Product Strategy

GrabFood is a food delivery service that provides customers with a convenient and
dependable way to order food from a variety of restaurants. The main service characteristics of
Grab Food include intangibility, inseparability, heterogeneity, perishability, and customer
interaction. GrabFood is an invisible, intangible service, and its value comes from the
convenience it offers users. The service offered by the delivery rider and the delivery of the
food are inextricably linked. The total customer experience may be impacted by the service
quality. Depending on the delivery driver, restaurant, and location, the service's quality can
change. Although GrabFood tries to maintain a high standard of service quality, some
circumstances may be beyond its control. Furthermore, food provided by GrabFood has a short
shelf life and is perishable. This indicates that crucial elements in guaranteeing the food's
quality and safety include delivery timing and temperature management. Because consumers
can check on the status of their deliveries, provide comments, and review their entire
experience, GrabFood offers a high level of customer contact. Overall, GrabFood's service
characteristics are focused on providing a convenient and reliable food delivery service to
customers while maintaining a high level of service quality and customer satisfaction. To
market this service, Grab Food should highlight the convenience of ordering food online, the
variety of food options available, and the speed and efficiency of the delivery process.
 11

Pricing Strategy

Next, in terms of the pricing strategies of GrabFood, it strives to maintain competitive

pricing in the meal delivery business while balancing customer demand, delivery rider
availability, and restaurant partner profitability. Every order has a delivery fee that varies based
on the distance and location of the delivery. Longer distances and more remote locations
typically have greater fees. In order to encourage more delivery riders to sign up for the
platform and guarantee on-time deliveries, GrabFood may raise its delivery cost during busy
times or periods of high demand. GrabFood routinely runs sales and promotions to draw in new
clients and keep old ones coming back. They can include free shipping, delivery savings, or
buy one, get one deal. Also, in order to encourage repeat business and keep customers, it might
provide loyalty programmes with incentives like points or rebates. GrabFood also charges a
commission fee to its restaurant partners for each order placed through the platform. This fee
varies depending on the partnership agreement and can range from a fixed percentage of the
order value to a flat fee per order. GrabFood should price its service competitively, taking into
account the fees charged by other food delivery services. They should also consider offering
discounts and promotions to attract new customers and retain existing ones.

Distribution Strategy

Grab (GrabFood), a leading online food delivery platform, uses several distribution
strategies to ensure that food orders are delivered to customers in a timely and efficient manner.
Here are some of the most important distribution strategies used by Grab:

One of the main distribution strategies that Grab has implemented is a fleet of delivery
drivers. Grab maintains a fleet of delivery drivers who are responsible for picking up orders
from restaurants and delivering them to customers. These drivers are equipped with GPS-
enabled smartphones that allow them to receive and track orders in real time. Grab's delivery
drivers are trained to provide fast and efficient delivery services, ensuring that customers
receive their orders in a timely manner. (Madhav, 2022).

By partnering with a wide range of restaurants, Grab is able to offer customers an

unparalleled selection of food options and cuisines to choose from. Grab partners with a large
number of restaurants and food outlets, allowing customers to order from a wide range of
restaurants. Grab's delivery drivers then pick up the food from these restaurants and deliver
 12

them to customers. To maximise efficiency and reduce delivery times, Grab uses advanced
routing and optimization algorithms to determine the fastest and most efficient routes for its
delivery drivers. This helps to minimise delivery times and reduce delivery costs. The
algorithms take into account traffic conditions, road closures, and other factors that can affect
delivery times. This ensures that customers receive their orders quickly and at a reasonable
cost. In addition to maintaining its own fleet of delivery drivers, Grab also integrates with
third-party logistics providers to offer delivery services in areas where it doesn't have its own
delivery infrastructure. This allows Grab to expand its delivery reach and offer services to
customers in more areas.

Grab introduced contactless delivery in response to the COVID-19 pandemic. This

feature allows customers to request that their orders be delivered without any physical contact
with the delivery driver. Customers can request that their orders be left at the door, and the
delivery driver will notify them once the order has been delivered. This feature provides
customers with peace of mind during the pandemic and has become a popular feature among
Grab users.

In summary, Grab uses a range of distribution strategies to ensure that food orders are
delivered to customers in a timely and efficient manner. These strategies include maintaining
its own fleet of delivery drivers, partnering with restaurants, real-time order tracking, advanced
routing and optimization, integration with third-party logistics providers, and contactless
delivery. These strategies have helped Grab establish itself as a leading online food delivery
platform.

Promotional Strategy

Grab is a leading online food delivery service that operates in multiple countries across the
globe. Grab is a Southeast Asian ride-hailing and delivery company that offers a wide range of
services, including food delivery through its Grab platform. The company has employed
several promotional strategies to attract and retain customers. Here are some of the most
effective strategies used by Grab for GrabFood:

To begin with, the first promotional strategy they use is discounts and promo codes. Grab
offers various discounts and promo codes to its customers to incentivize them to use its
services. These discounts and promo codes can be used to get a percentage off the order value
or a fixed discount on the order. The company promotes these offers through various channels,
 13

such as its website and social media pages. Grab also partners with banks and credit card
companies to offer additional discounts to their customers.

Another important strategy they use is referral programs. Grab's referral program is
designed to encourage existing customers to invite their friends to use Grab. When a customer
refers a friend to Grab, both the customer and the friend receive rewards. The rewards can be
in the form of discounts, free meals, or other incentives. Grab promotes its referral program
through social media, email newsletters, and push notifications on its mobile app.

Furthermore, it is worth noting that social media marketing is a strong approach towards
promotion for Grab. They have a strong presence on social media platforms like Facebook,
Instagram, and Twitter. The company uses these platforms to engage with customers, promote
its services, and offer exclusive discounts and promo codes. Grab also partners with social
media influencers to promote its services to its followers. The company's social media pages
feature high-quality images and videos of food, which are designed to make the customers
crave the food and order from Grab. (Mustafa, 2021)

In addition to the previous points, Grab uses partnerships and collaborations as well.
Grab partners with restaurants, food bloggers, and other food-related businesses to promote its
services. The company collaborates with restaurants to offer exclusive discounts and promo
codes to Grab customers. Grab also partners with food bloggers and social media influencers
to promote its services to its followers. By collaborating with other businesses, Grab is able to
reach new audiences and expand its customer base. (Mustafa, 2021)

In summary, Grab employs a range of promotional strategies to attract and retain customers.
These strategies include offering discounts and promo codes, referral programs, social media
marketing, and partnerships and collaborations. By using these strategies, Grab has been able
to establish itself as one of the leading online food delivery services in the world.
 14

Conclusion

In summary, Grab's market analysis through a SWOT analysis has revealed that the
company has numerous strengths, including brand recognition, a convenient mobile app, and a
strong technical infrastructure. However, Grab also faces weaknesses, such as possible poor
user experience and limited geographical coverage. In addition, the company has plenty of
opportunities for growth, including expanding into other markets, as the market for ride-hailing
services continues to grow. The primary threat facing Grab is the high market competition
level, which slows down its growth. In terms of segmentation, Grab uses a combination of
geographic, psychographic, and behavioural segmentation to target different customer groups.

Furthermore, through an undifferentiated marketing strategy, the company has offered

the same product to all customers regardless of their individual preferences. Grab also employs
an individual marketing strategy, tailoring its marketing messages to specific groups of
customers in the food and beverage market. These marketing strategies have allowed the
company to reach a wider audience while still catering to the needs and preferences of
individual customers. In terms of positioning, Grab has positioned itself as a reliable and
convenient company in the market. The company provides various services, such as food
delivery and financial services, through its mobile app, where it has been able to differentiate
itself from competitors. In addition, the company uses a marketing mix that includes product,
price, promotion, and place to attract and retain customers. For instance, it offers competitive
pricing, regular promotions, and a user-friendly mobile app to provide a seamless customer
experience in the food and beverage market. Overall, Grab's market analysis reveals that it is a
strong food and beverage market player.
 15

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 17

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