GrabCar had been launched in July 2014 but had not gained any traction. The Grab team was also hesitant to market it much as they were concerned about the potential ire of the taxi drivers. The internal debates carried on—and by the time Grab decided to commit to developing GrabCar (what the business would call its second ‘vertical’ or business line after taxis), it had lost about a year to Uber growing its presence in the region. Gill evaluated, “Can you imagine, if we had gone all-in early on, we probably wouldn’t have to fight this war with Uber.” A year later in 2015, Grab set up a separate team to manage GrabCar, a new dedicated team whose sole mission was to grow the vertical. The product and engineering team, which was centralised, started prioritising features in the app that would be beneficial for GrabCar users. One of the key new features of GrabCar was job assignment for drivers. Taxis followed a bidding system that mirrored that of the radio call centres. The jobs were broadcast to a group of drivers nearest to the passenger, and each of the drivers could register/bid their interest for the job within a bidding window. Then out of these, the closest driver would be assigned the job. Job assignment was different. For private cars, the closest car would automatically be assigned the job—and if the driver rejected the job, it went to the next closest driver. The difference here was in terms of the incentives offered to the drivers. A private car driver who wanted to earn incentives, such as fee rebates, from Grab had to maintain around an 80% acceptance rate. After GrabCar, the company subsequently rolled out new verticals such as GrabBike for motorbike hire in Vietnam (Nov 2014), GrabExpress for parcel delivery (July 2015), and GrabPay for mobile wallet payments (January 2016). Question: Diagnosis the problems faced by Grab, interms of strategic uncertainties.
GrabCar had been launched in July 2014 but had not gained any traction. The Grab team was also hesitant to market it much as they were concerned about the potential ire of the taxi drivers. The internal debates carried on—and by the time Grab decided to commit to developing GrabCar (what
the business would call its second ‘vertical’ or business line after taxis), it had lost about a year to Uber growing its presence in the region. Gill evaluated, “Can you imagine, if we had gone all-in early on, we probably wouldn’t have to fight this war with Uber.”
A year later in 2015, Grab set up a separate team to manage GrabCar, a new dedicated team whose sole mission was to grow the vertical. The product and engineering team, which was centralised, started prioritising features in the app that would be beneficial for GrabCar users.
One of the key new features of GrabCar was job assignment for drivers. Taxis followed a bidding system that mirrored that of the radio call centres. The jobs were broadcast to a group of drivers nearest to the passenger, and each of the drivers could register/bid their interest for the job within a
bidding window. Then out of these, the closest driver would be assigned the job. Job assignment was different. For private cars, the closest car would automatically be assigned the job—and if the driver rejected the job, it went to the next closest driver. The difference here was in terms of the incentives offered to the drivers. A private car driver who wanted to earn incentives, such as fee rebates, from Grab had to maintain around an 80% acceptance rate.
After GrabCar, the company subsequently rolled out new verticals such as GrabBike for motorbike hire in Vietnam (Nov 2014), GrabExpress for parcel delivery (July 2015), and GrabPay for mobile wallet payments (January 2016).
Question:
Diagnosis the problems faced by Grab, interms of strategic uncertainties.
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