Singapore-based super app company Grab’s success story is perhaps one of the most impressive out there. Though it started out as a simple taxi-hailing app, it quickly evolved beyond its core business into fields like mobile e-payments (GrabPay) and food delivery services (GrabFood). And so, since its inception in 2012 it evolved to become Southeast Asia’s first “decacorn” (startup with a valuation of over US$10 billion) operating in Singapore, Malaysia, Cambodia, Indonesia, Myanmar, Philippines, Thailand, Vietnam and Japan.
So how did Grab become so successful and end up in Fast Company’s ‘Most Innovative Companies’ list? Here are some of the incredibly intelligent tactics they used:
1. Think about partner Experience
There has been a lot of talk about employee experience being the backbone of customer experience lately. And I truly believe that happy employees beget happy customers. Grab is taking this approach one step further, by creating a fantastic and empowering partner experience with its drivers. This stands in sharp contrast with how other platform companies in the US treat their drivers or other local entrepreneurs. In fact, I learned from my nexxworks business Partner Pascal Coppens that this relationship driven platform approach is typical for Asian cultures. Alibaba and Didi, for instance, use the same tactics.
This continuous attention for improving the lives of its drivers has its roots in a very concrete challenge that dates from their early days in 2012. Back then, the average Singaporean taxi driver could not afford smartphones and did not know how to use them. So Grab first gave them smartphones on a payment plan. And then the Grab team went into the field to explain the technology to these drivers at airports, shopping malls and gas stations. Not just the Grab app but other tools too, like WhatsApp and Google Maps. And this close relationship of feedback and enablement of drivers and addressing socio-economic challenges has since then been deeply engrained in Grab’s company culture. Not surprisingly, its driver-partners earn 32% more income per hour compared with average worker wages of other platforms.
This close partner relationship is for instance why Grab is continuously striving to make rides more profitable for drivers. A great example is the collaboration with Cargo which allows the drivers to sell a selection of snacks, toiletries, and phone chargers during their trip, on which they make a 25% commission. They can easily earn an extra $300 a month that way. Or there’s the Grab Small Business Booster Program aimed at helping small businesses in Southeast Asia adapt to the COVID-19 new normal. On top of that, between March and April 2020, Grab rolled out over 100 initiatives to help drivers- and delivery-partners, frontliners and communities who were struggling because of the pandemic. In partnership with insurance company Chubb it also offers insurance solutions for its driver-partners. Using the Grab app, they can protect their vehicles, livelihoods and families, with access to loss of income insurance, per-ride schemes, personal accident policies and motor insurance.
It’s clear that Grab is a great fan of the “Pay it forward” principle: help your drivers as much as possible and they will help your customers as best they can too.
2. Get out of your own lane
Companies of today are no longer content to stay in the ‘lane’ of their own industry. Diversification has become a big part of innovation, and Grab is completely on board with that trend. It may have started out in the mobility sector, with a ride-hailing app but as time ticks by, it keeps venturing in other mobility-segments and even other industries.
At first, Grab ‘only’ diversified its mobility offering. GrabTaxi – originally called “My Teksi” – expanded with GrabCar (using personal cars instead of taxis) and motorcycle ride service GrabBike. Later GrabCar+ (with higher-end cars) was added, as well as GrabHitch (carpooling), GrabExpress (last mile delivery), GrabCoach ( large passenger vehicles), GrabFamily (with child restraint seats for young children below 7 years old) and GrabPet (with drivers who have received training in pet-handling). They were later all added to the simplified flat-fare structure JustGrab.
Grab understands the power of niches like no other, but realizes just as much the value of jumping to other industries. From passenger mobility, it moved on to packages and food with GrabFood food delivery and the GrabExpress courier service. In 2016, it launched the GrabPay payment service as a digital payment service among third-party merchants, allowing users to use the app for purchases outside of ride-hailing as well. The year after, it acquired Indonesian online payment startup Kudo to integrate its platform in Grab’s payment system. This was Grab’s first step into expanding fintech services.
In 2018, it then went on to launch Grab Financial, which offers payment, insurance, and financing services. At the end of last year, it was even granted a digital bank license in Singapore in order to further expand its financial services offerings. These financial power moves are in fact very similar to those of the Chinese Alibaba Group and its financial affiliate the Ant Group. Asian platform companies love to think further than the payment functionalities of their initial offering. And that’s because they understand that the customer experience does not begin and end with their own product and service but is impacted by the entire context around it.
3. Think in ecosystems
Rather than completely reinventing the wheel when launching in a new segment or industry, Grab focusses on forming partnerships or even acquiring players who have the experience they lack. It works with governments, banks, insurers and telco players in order to make transportation and transactions safer, more affordable, and more reliable. Its collaborations are numerous and too much to sum up, but here are some of the most visible examples.
In Thailand, Grab collaborates with Krungsri Finnovate, the corporate venture capital arm of Bank of Ayudhya, to provide financial services on its platform and promote “sustainable banking” through financial inclusion. The full digital banking license mentioned above was acquired in a consortium with Singapore Telecommunications Ltd. in a Singapore government initiative to attract technology firms into its financial sector. It also signed a partnership with Chubb to provide innovative, customized and cost-effective in-app insurance solutions throughout Southeast Asia.
Hyundai and Kia, too, partnered with Grab to increase EV usage in Southeast Asia and Microsoft invested in Grab to improve user safety and experience with artificial intelligence and facial recognition. Marriott International, then, has a partnership with Grab as well: it integrates its platform across its service portfolio, including food delivery, payments, transport, and advertising.
Few innovation approaches match the speed and convenience of creating an ecosystem with smart partnerships. The more fully formed services a company can offer on top of its existing offer, the better customers will be served. And Grab has truly excelled at this approach.
4. Offer a fantastic experience
Lack of safety is unfortunately still one of the most important forms of friction in ride-hailing. Which is why Grab invests a lot of money in improving user safety and experience. The example above from Microsoft is a very important project here, using artificial intelligence and facial recognition to verify both the drivers as well as the passengers (as the driver’s safety is just as important as that of the passengers, as we learned in part 1). It also uses the customer experience platform Sprinklr to listen to what customers like and dislike on social media and safety is a big part of that: like picking up mentions of drivers’ reckless behavior like riding motorbikes on pedestrian paths.
The “Share My Ride” option in the Grab app also allows passengers to share their ride details with loved ones, which is not just convenient (so they know when you will arrive) but also a form of reassurance for people who aren’t feeling comfortable when riding at night. Trip monitoring technology, then, is used to track deviations from the planned route, as well as unplanned stops that will trigger a notification on the passenger’s app to check if he or she is fine. Grab also uses telemetric data to detect crashes and trigger an emergency call for an ambulance.
But it’s not just the safety that’s focussed on. Grab wants the overall customer experience to be perfect. When it comes to food delivery it uses a top of the shelf data driven approach. It for instance predicts which delivery partners can deliver orders – using which mode of transportation – in the fastest time based on location, food preparation time estimation, real-time and historical traffic data, delivery distance, and more. It helps delivery partners take the most efficient routes and reduce any idle time so that they can earn more. Machine learning and AI models also allow it to track down food demand gaps in certain cities and closing them by establishing and expanding cloud kitchen networks, giving consumers access to more cuisine options.
With this data-driven philosophy, Grab is permanently on the lookout for how it can offer more innovative, safer, more convenient and ever more fantastic customer experiences.
What about you?
So what about your company? How could you boost the employee and even partner experience to empower them to give customers a fantastic experience? Are there any other segments and (adjacent) industries you could enter to serve your customers even better? You don’t have to do that alone: embrace ecosystems thinking to connect with partners who are already in those segments and industries. And last but not least: could there be other ways that you could bring your experiences to a whole new level?