Indonesia The Battle Of Ride Hailing Service Giants GO-JEK Vs GRAB

High consumption rate and mobility of its citizen, Indonesia is definitely a magnetic country for businesses, in any form including ride hailing services.

The past few years were quite monumental for this type of sector as dozens of start up companies emerged and tasted the market, however only two survive and dominate now. Grab, the Largest Oniine Ride Haiting Service in Southeast Asia and Indonesian Unicorn Start-Up, Go-Jek.

The battle between two companies is intense as both of them are increasing their line of products. The provided services, like food delivery, ride-hailing are similar in nature. Nevertheless, the consumers are always be the final judge.

Spire Research and Consulting Indonesia, one of the leading global research company headquartered in Tokyo, Japan, conducted a study on drivers and customers to know the preference of ride hailing services based on several aspects, starting from consumer’s awareness, usage frequencies, to their preference in using in each other’s e-money1.

“The most interesting findings by Spire is the existence of frauds and how the drivers perceive it,” ujar Jeffrey Bahar, Group Deputy CEO Spire Research and Consulting, in Jakarta, Hongkong Cafe Jakarta (30/1/19).

Based on Spire’s Consumers’ Awareness Survey, 75% and 61% respondents claimed Grab as the brand that they use in the past 6 months and 3 months consecutively. Meanwhile 62% and 58% respondents picked Go-Jek in the same categories. Regardless, 50%, of respondents agree that both Grab and Go-Jek are their favorite brands.

On the product usage frequency side, at the end of the 4th quarter 2018, Grab’s customers were more frequent in using Grab’s line of products compared to Go-Jek’s. 34% of Grab-Car customers are more likely to use the service on an average of 3--4 times a week, while Go-Car usage exhibits
tess usage frequency at 25% of Go-Car customers are likely to use the service on an average of 1-2 times a week.

Go-Jek’s Go-Ride on the other hand is still customer's favorite as 64% of its customers like to use Go-Ride for 1-2 times a day meanwhile Grab stands on the percentage of 58% in the same category.

When it comes to food delivery. Go-Food is in the lead with 35 percent of respondents saying GoFood was the brand they most often used, but Grab is catching up quickly with 27 percent saying they used GrabFood the most.

As of 2018, both apps were developing their e-money as a new way of e-payment in Indonesia. Grab launched a cooperation with DVD, while Go-Jek believes in Go-Pay. Based on the survey results. 0V0 usage exhibits strong 020 usage. while Go-Pay’s strength is within Go-Jek's mobile app ecosystem. For exampie, DVD is the preferred payment for offline items like phone balance, parking bills and bill for non~food merchants. while Go-Pay is used to pay food-merchant bills (GoFood) and electricity biils through the Go-Jek app.

The most interesting finding as Spire found was fraud. Generally. fraud in online ride hailing service is an open secret among drivers. Most of the drivers who committed it have similar reasons as to why they do it, which is to increase their monthly income.

Fraud is becoming a huge issue in the industry because it causes economic loss to a company and shows how vulnerable their systems are.

According to Spire's research, nearly 30 percent of Go-Jek's total transportation orders might be fraudulent compared to 5 percent for Grab. This is based on an estimation of fraud orders against total orders. This is a systemic problem for both companies and one that Go-Jek needs to address.

According to Spire’s driver survey, as of 2018, nearly 60% of Go-Jek’s drivers say they commit frauds on daily basis to boost their order numbers that affect their bonuses as well as their daily income.

The drivers said that Go-Jek’s system is easier to trick by using apps that modify their location. On the other hand, less than 10% of Grab’s drivers say they commit frauds.

Grab's drivers said the Grab system is not easy to trick and the sanctions by the company was a deterrence. Drivers also commented that both companies are improving their systems to better detect frauds.

Overall, both companies are growing rapidly in food delivery and ride-haiting but spectat attention needs to be paid to the issue of fraud in order to ensure the healthy development of the technotogy ecosystem in the country.