Safety and service quality are tops for 2019, says Grab's head of regional operations

Safety and service quality are tops for 2019, says Grab's head of regional operations

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It is ramping up efforts to deliver on its Super App service ahead of renewed competition
6 -min read
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Singapore

COME next year, Grab will invest "tens of millions of dollars" into boosting its safety features, according to the firm's head of regional operations Russell Cohen.

A lot of the safety technology will revolve around areas such as the verification of driver identities, driving down crime and reducing fraudulent bookings and fake rides.

"We'll be hiring lots of new engineers and on-the-ground safety people to just make sure that Grab is the safest transport option for people in South-east Asia when they want to book a ride," said Mr Cohen.

He was speaking to The Business Times after a joint media event with Toyota Motor earlier this week. Mr Cohen highlighted safety and service quality as key areas that the company will double down on for the upcoming year.

He told BT that there are many pain points for the firm concerning safety issues, and gave an example of how Grab has invested millions of dollars in a technology that masks mobile numbers on the app so that the incidence of harassment and unwanted post-ride contact will be reduced.

When the feature was rolled out in Jakarta on Nov 1, the reported cases of phone harassment between driver and passenger fell by 70 per cent in four weeks, according to Grab.

When it comes to quality, Mr Cohen said the idea was to focus on enhancing the experience of users, drivers and merchants.

In Singapore, for instance, Grab is planning to roll out an Electronic Road Pricing (ERP) calculator that would automatically add ERP charges to the ride fare, Grab's Singapore head Lim Kell Jay told reporters during a media luncheon last week.

The feature was requested by about 40 per cent of Grab drivers, some who at times would forget to key in the additional fees at the end of the trip.

New services

The firm will trial a new pet service and point-to-point transport with larger vehicles in the coming months. It will also work on improving its map accuracy; more than 5,000 pick-up locations were added in Singapore this year, said Mr Lim.

Grab has come a long way since it received early backing from Vertex Ventures and GGV Capital. Its ongoing more-than-US$2.65 billion Series H round features industry heavyweights such as Microsoft, Toyota Motor and Booking Holdings.

The firm ramped up its Super App game this year by expanding into a number of key verticals. It launched financial services arm Grab Financial in March, a food delivery service in May, and a venture arm in June, among others.

Grab is already profitable in some of its key verticals in the more mature markets, and expects to double its revenue to US$2 billion next year. Mr Cohen said the firm has a huge appetite for growth for its food delivery business.

"Food's a big part of our growth plans for 2019. We will be expanding our GrabFood and delivery business and deepening our relationships with our restaurant merchants and our key partners in some markets," he said.

The company has been exploring various food business concepts for each of their markets. In Singapore, it is wooing users with local favourites such as durian and Jenny Bakery cookies all the way from Hong Kong.

It has also been rolling out S$1 deals featuring bubble tea and McDonald's chicken nuggets, among others.

Asked last week how these methods are sustainable for the business, Mr Lim said merchants are increasingly bearing the cost of the promotions after seeing an improvement in their business.

One merchant, for instance, now derives about 30 per cent of its revenue from GrabFood, he claimed.

In other markets, the company is likewise adopting a localised approach. The team in Vietnam has partnered with famous chefs to come up with menu choices exclusive to GrabFood. In Indonesia, Grab launched a central kitchen concept where popular merchants outside of Jakarta are brought in to one location to prepare food, reducing delivery times and expanding their reach.

While expanding its food business, the firm will also be looking at maximising the use of its assets. Mr Cohen said that markets such as Indonesia and Vietnam, where Grab has a motorcycle-hailing business, represent a good foundation on which to build its food and parcel delivery arm. The company is tapping the motorcycle fleet so that the same drivers who are ferrying people around are also delivering food and parcels.

Though the firm is powering ahead for 2019, there remain some loose ends to tie up from this year. The tumultuous ride for the Singapore-based unicorn peaked in March when Grab announced that it was acquiring Uber's South-east Asia operations after a drawn-out battle.

It was a major win for the regional player against a US-based giant, though the repercussions of the merger followed soon after in the form of a fine and remedies imposed by the Competition and Consumer Commission of Singapore (CCCS).

Grab has stood by its belief that CCCS took a "very narrow approach in defining competition". But the firm got a slap on the wrist from Philippines authorities too, which ordered them to pay 12 million pesos (S$309,650) in fines.

Meanwhile in Vietnam, the country's competition watchdog decided last week that the merger may have infringed anti-trust laws on two counts. Malaysian authorities said in July that it was reviewing the merger, though no updates have come since.

Competition ahead

This year also saw the entry of fellow unicorn Gojek in Singapore. The Indonesia-based company rolled out its beta app in November, ending months of anticipation.

Industry watchers BT spoke to said now that both firms are in full-on Super App mode, the competition is unlikely to revert to the price-war days of Uber versus Grab. Mr Lim has also publicly said earlier this month that commuters should not expect the comeback of promotions, citing unsustainability and lack of customer stickiness as reasons.

Taxi operator ComfortDelGro is also stepping up its game. It announced in October that it was teaming up with Finnish startup MaaS Global to launch a subscription-based service that combines several modes of transport in one trip.

Asked during the Grab and Toyota media event what the effect of Gojek's South-east Asia expansion has been, Mr Cohen said: "We've seen no impact on our business since Gojek launched in Vietnam, or in Singapore last month, or in Thailand last week. Our business has grown from month to month."

Though it's still early days, Mr Cohen pointed out that Grab has competitors in all the countries it operates in. "Our focus is, as always, on the customer - operating the best platform across the region, operating safe services and also the best product experience," he said.