This article is rather unusual and new in format as we are exploring Grab's new business model following its merger with Uber Southeast Asia. As a disclaimer, we have no affiliation to Grab, and our intellectual exploration of possibilities do not necessarily reflect Grab's vision and strategy.
Unpacking Grab's Products
Let's start with...
We were surprised by this feature. From our perspective, it is a test feature that Grab is experimenting with to further develop into an "everything" feature whereby users would have access to lifestyle related information ranging from where to eat, what to eat, what to do, what's new in town, etc...Images Credit: Author
Eventually, Grab incorporates its current product to the Grab Daily's sub-products as shown in the previous images (emphasized in red). As such as we can assume that that Grab aspires to take a cut of your daily economic activity (which we also assumed at some point with Honestbee As A Data Company)
As Grab Daily grows in popularity, Grab will in turn allow users to purchase event tickets via Grab Daily leveraging on Grab Pay.
Grab Financial Services
GrabPayImage Credit: Author
The mother of all features and products within an app lies in its ability to accept electronic payment.
There are a couple of reasons for GrabPay to be star, we believe in these 3:
- Enabling in-app payment enables Grab to control the money flow; which in turn, benefit the company through clear indicators of "transaction" completed. Analogy to Carousell which at the time of writing does not enable in-app payment and thus can't prove that "transactions" are genuinely happening.
- Through a seamless user experience from booking a ride to completing a ride, Grab is conveniently making it easy to spend more. As it is adding up new products and features such as Grab Daily and Grab Financial Services, it would be a matter of time before users can 'conveniently' buy a movie ticket or an event ticket. Grab will benefit from users spending more time on its app and potentially completing more "transactions" per day which wouldn't otherwise be possible if it remained a ride-hailing app only.
- There is a possible agenda with having everything done in-app including payment: Offering processed information to put something important here for free or for a lot of money. Look at how so-called bike sharing companies are working with various institutions from private to public sector to drive someone's agenda, say for reducing carbon emission...likewise, Grab could contribute to re-designing cities or to enabling people to access information that they would otherwise fail to have accessed to...
GrabRewardsImage Credit: Author
A fairly straightforward product that works hand in hand with Grab Pay. We could look at Grab Rewards from 3 perspectives:
Firstly, Grab Rewards will drive traffic to an (offline) retail outlet through discounts, and in turn, these retail outlets should or would aspire to enter Grab's ecosystem of products.
Secondly, Grab Rewards should be a catalyst for Grab Pay. As more (offline) retail outlets are onboarded into Grab's ecosystem, they start accepting Grab Pay. The latter is probably faster and cheaper than credit cards for the (offline) retail outlet.
Thirdly, Grab Rewards is a simple method to reward users for their loyalty. The more you use Grab, the more points you earn and you are eventually rewarded for your "effort".
Other Grab Products across Southeast Asia
GrabExpress is a door to door parcel delivery service while GrabFood is the food delivery service. Simple.
In Indonesia, the parcel delivery within Jakarta became a highly commoditized service due to the rise of e-commerce and multiple logistics players.
However, both GrabExpress and GrabFood enables the company to continuously capture a share of its existing users' wallets.
Some screenshots as May 2018, courtesy of Aaron Michael (Link)
Where does Grab go?
Previously, we wrote a short article on Grab's business model (link) from 2012 to 2018. We tried as much as possible to look at Grab as a ride-hailing company, but it has already been made "clear" from past 1-2 years or so that Grab was willing to be more.
The question is "where does Grab go?" given the sheer amount of resources at its disposal.
Sure, Grab is...
- driving towards an everything app within the internet & consumer sectors,
- identifying how to build its ecosystem and efficiently inter-linking all parts together;
- aspiring to establish an economic moat through a cut of the user's daily economic activity.
It leaves room for ingenious founders to start operationally efficient businesess to eat Grab's lunch, and become acquisition target by the ride-hailing giant.
Who could they acquire next?
- Chope is a well-established player in the F&B sector, which could readily complement Grab's suite of products. Chope could be an extension: Making restaurant reservation and taking a grab ride to & fro restaurant, a seamless experience. Simultaneously, GrabPay being used to pay for restaurant bill (and for the rides) and rewarding users with GrabRewards points.
- Fave, which was founded by experienced startup entrepreneurs like Joel Neoh (he even has a Wikipedia page) who is famous within the startup community in Asia for running Groupon cloned before being acquired by Groupon itself. Fave is an e-commerce lifestyle firm that could possibly fit Grab's business model evolution as seen with Grab's attempt to make Grab Daily and GrabRewards which are both in line with Fave's target audience and job to be done.
Grab is going through an interesting stage of their startup lifecycle and will hopefully impress us with both new business model and product innovation.
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