Whenever anyone thinks about the ride-hailing industry in Southeast Asia, one story that pops up is the rise of Grab and its remarkable defeat to Uber. Grab beats Uber - a company worth over 10 billion dollars.
For business owners like you who offer various types of taxi transportation services, it’s a lesson that the right strategy with the right and reliable technology can grow your business to new success heights.
In this blog, you will learn about how Grab defeated Uber and what you can learn and implement in your business from its success story.
Started small with one niche
Yes! Grab first was called “MyTeksi”. It first launched its taxi booking app - “MyTeksi” and offered online taxi booking and transfer services in Malaysia.
The company was founded in 2012 by Anthony Tan (@AnthonyPY_Tan) who was a computer science student and his friend, Tan Hooi Ling (@hooilingtan).
Grab got a positive response from Malaysian customers. And this gave them the confidence to expand it to Southeast Asia (countries like Singapore, Jakarta & Bangkok).
Then in 2014, they expanded the company to more Southeast Asian countries like the Philippines and Vietnam. And here they jumped with the new type of service - GrabBike.
This strategic move turned out to be a massive success for Grabas most of these Southeast Asian countries had no official taxi or BikeTaxi services. Citizens in these countries had to rely on taxis or private cars for transportation.
Rebranded ‘MyTeksi’ to ‘Grab’
Later, both the founders decided to rebrand the company from MyTeksi to Grab in 2016.
Till now, Grab’s ride-sharing services have been available across Malaysia, Singapore, the Philippines, Thailand, and Vietnam.
They didn’t just stop offering ride-sharing services. But, they expanded into food delivery with GrabFood, similar to UberEats. This allows people from Southeast Asia to order food easily from the restaurants partnered with them.
To provide services beyond Uber, Grab also launched GrabCar and GrabPay (supported by more than 30 different currencies).
The Grab app's success
Grab has come a long way since its early days. Now, it’s the leading ride-sharing app in Southeast Asia. In addition, it is also serving millions of users daily with services ranging from food delivery to motorcycle taxis, and more.
Furthermore, Grab became Southeast Asia’s first unicorn startup in November 2016. It also booked its position as the most valuable startup in Singapore and the top ride-hailing app in the region in 2017. The legacy continues still.
Also read: The most reliable Grab clone app for taxis and beyond
How did Grab defeat Uber?
Well, Grab beat Uber by implanting its existence in Southeast Asia strategically.
Let’s discover each of them in detail below.
Grab adopted hyper-local business strategy
One of the most significant factors in how Grab defeated Uber was focusing strategically and strongly on the local market.
Grab adopted different cultures and offered various services in native language in the countries it expanded into. This strategy helped Grab gain the attraction and trust of the local customers than Uber ever did.
Grab knew it well that the culture that people follow in Thailand would not be followed by the people of Singapore. Hence, Grab did not copy-pasted its strategy to all the Southeast Asian countries.
Instead, it customized the service offerings, eliminated global model business strategy, and hired locals to offer other locals services in native language with the same culture they follow.
This unique and personalized approach of hyper-local business strategy helped Grab win every new initiative they took in various Southeast Asian countries.
Offered cash payment service to locals
Many countries of Southeast Asia are cash-based economies. Grab knew this fact very well. That’s why they integrated the cash payment feature in their app from day one.
On the other hand, Uber didn’t have any cash payment feature until 2015. And they suffered a lot.
When Uber initially started its operation in San Francisco, the mode of payment it offered was of a credit card. This decision didn’t affect them as people in San Francisco are very well-habituated with card and cashless payments.
However, in Southeast Asia, the cashless payment method didn't work for Uber.
Launched a “Super App” with various services
Grab launched an all-in-one app for Southeast Asian people.
The all-in-one app includes;
- GrabFood
- GrabFresh
- GrabCar
- GrabBike
- GrabPay
And more upcoming projects…
They are all ready to use apps. Users just have to download, signup, and use for almost all the needs they have.
The Grabs super app became a one stop shop for Southeast Asian people that addressed multiple needs in a single go.
Moreover, it is still significantly contributing to its market dominance in ride hailing and other industries. Grab app is also known as TAM - total addressable market.
Grab app is accessible and easy to use
The secret of the Grab app’s success is rooted in convenience. It means, Grab made life easier for the people of Southeast Asia by almost everything they need in their daily routine.
Plus, users just have to download the app and it's ready to use. This makes it extremely convenient and easy for the customers to access Grab’s service anytime.
Grab also offered a cash payment option whereas Uber only was offering credit card option.
This level of convenience made it hard for Uber to compete with Grab and hence it became the first choice of Southeast Asian people. They now use Grab to fulfill their multiple needs in a couple of clicks.
People showed their trust and interest in Grab more than Uber which is why Uber left Singapore and other Southeast Asian markets.
Key factors in Grab's success
Apart from launching the super app, offering cash payment options to customers, and adopting the hyper-local business model, Grab went beyond these to beat Uber in the Southeast Asia market.
Here is what it did to success.
User-friendly app
Grab knew that to win the Southeast Asian market and the hearts of the people, the app should be extremely easy to use. The UI/UX should be attractive yet simple to access for everyone.
And Grab did the same. It offered a user-friendly interface and a ‘pay in cash’ option. This made Grab the only choice for people to fulfil their needs with a few taps on their smartphones.
Offered reward programs
Another way Grab outshined Uber was by offering attractive rewards to its customers and drivers. Grab was aware that people love reward, hence, they used it as a strategy to attract customers. And by doing so, they succeeded even.
Offering rewards helps them build a loyal customer base and driver base. This is how Grab became successful in the Southeast Asia market.
Built a good company image
Grab is considered the best company in the Southeast Asia market. The reason behind this is, that people find their service affordable and exactly the same they want.
Plus, they also treat their customers and drivers with respect. To drivers, Grab compensates and distributes money fairly.
Driver appreciation is what Grab often does to boost their performance and generate respect.
These activities helped Grab build a good company image.
Trust and transparency
Another reason Grab is able to build a good image and relationship with its customers is - transparency and trust. These two factors are crucial in any business to succeed.
And Grab excelled in building it. From clear pricing to fair driver treatment, Grab made sure its users what to expect.
This transparency has helped Grab emerge as the most trusted brand in the battle of Grab vs Uber.
Also read: How yelowsoft elevates customer experience for long-lasting loyalty
Focus on the social betterment
See Apple, Nike, Coca Cola and other successful brands and startup companies, the one best strategy they focus on is - focus on the people.
Successful startup taxi and ride hailing companies focus on their drivers and passengers. Grab did the same. They focused on their people and making sure they are happy.
They know happy employees work hard to make their customers happy. This leads to higher profits. Hence, They first worked on making their drivers happy, who further pays off the Grab by providing memorable service to customers.
So, Grab did not focus on making money. But, aimed to improve the lives of their customers. This people focus action is the key reason of how Grab became successful in the Southeast Asia market.
Conclusion
The story of Grab defeating Uber in Southeast Asia is more than just a business success. Actually, it's a lesson for local taxi business owners as how Grab gave importance to understanding local markets, offering convenience, and building trust.
For taxi business owners like you, the key takeaway is that with the right ride-hailing software and a strategy tailored to your market, you can compete with even the biggest names in the industry.
Just as Grab showed, it's not always the size of your company that matters, but how well you adapt to the needs of your customers.
