Singapore remains key to Gojek’s plans, says its GM

WHEN asked to describe Gojek’s journey so far, words and phrases like "tumultuous" and "resilient partnerships" spill forth from Lien Choong Luen, general manager of Gojek Singapore.

“We’re a platform and we’re ultimately dependent on the goodwill of the driver partners and customers. That’s what the past 3 years have been about,” he said.

Gojek entered the Singapore ride-hailing market in November 2018, its first venture outside of Indonesia. At the time, it faced an incumbent Grab that had just merged with rival Uber’s South-east Asia operations. Between then and now, Gojek has trucked through the Covid-19 pandemic, merged with e-commerce player Tokopedia, and gone public with parent GoTo on the Indonesia Stock Exchange on Apr 11.

Indonesia has been the focus of its parent GoTo. Yet Lien said Singapore is still key for Gojek, despite the Republic being an outlier among its other larger, but less mature, markets in South-east Asia.

“This is where we have sophisticated and mature riders and drivers. The demand on the product experience, the data science models is highest here in Singapore,” said Lien.

Singapore doesn’t just house Gojek’s Singapore operations, but some of GoTo’s regional functions as well, including finance and data science. GoTo has 297 employees in Singapore now, with the bulk of them running Gojek’s operations here.

And in making market moves, Gojek has bucked the trend by rolling out a fuel surcharge and cutting its driver commissions before Grab did so, unlike in most industries where players typically wait for incumbents to introduce unpopular actions among customers. This has much to do with Gojek’s DNA, said Lien, and powers initiatives like “gotong royong” or kampung spirit.

“We are drawing on the spirit to say that we understand increasing some of these fares may impact the overall customer demand. But firstly, I think Singaporean riders understand some of these constraints, and secondly, the fuel price increase was very, very stark… we were willing and ready to take the heat because this was something that was important to the drivers,” said Lien.

Gig-worker protections are also on Lien’s mind as the spotlight intensifies on the subject of Central Provident Fund (CPF) contributions by both gig workers and the platforms. In recent weeks, a number of surveys and reports have garnered a response in Parliament over this issue. Senior Minister of State for Manpower Koh Poh Koon said that in nation-wide consultations, contrary to private surveys, a sizable number of gig workers supported mandatory CPF contributions.

Globally, gig-worker protections are on the cards, with countries as ideologically different as China and the US continuing to grapple with the issue. Lien said that with the 10 per cent commission Gojek now charges drivers till end of 2022, there are natural limits to co-contribution to make it commercially viable.

Lien said: “The elasticity of demand is quite high. If I put 10 per cent to the customer, the demand drop will be more than 10 per cent, so the take home pay of the driver will be less. For the good of the driver, getting the right number is important.”

In the years since its entry into Singapore, Gojek has managed to carve out a slice of the Singapore market. Catching up with Grab has meant introducing the features like extra-large vehicles and premium vehicles, as well as a billing platform for businesses, GoCorp.

Now, Gojek is in a “comfortable No. 2” in ride-hailing market share, said Lien. Gojek declined to provide specifics on driver or user numbers. With the public listing in the rear-view mirror, Gojek now has access to capital markets for more investments, not just promo codes.

“What liquidity and funding will do is pump investment in the back end, on data science, improving the models, getting better allocation. Investing in talent, investing in more robust data infrastructure,” said Lien.

In describing Gojek’s future in Singapore, Lien has just one word: “Promising.”