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Gojek expands services in Singapore but lags behind Grab

Written by Khamila Mulia Published on     3 mins read

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Grab has more extensive offerings than Gojek in food delivery, courier services, and financial verticals.

Gojek’s new six-seater vehicle service, GoCar XL, will go live in Singapore on November 22, the firm said on Tuesday. The fare for GoCar XL is 30% to 60% higher than regular GoCar rides, so driver-partners can earn more with the new service.

More broadly, Gojek is stepping up its offerings in Singapore. In October, the firm launched a B2B service, GoCorp, that helps companies arrange their employees’ transportation allowance. Earlier this month, Gojek introduced additional features like GoCar Passes that protect users from surge pricing, and the “Edit Pick-up” feature that allows customers to change their meet-up location after being matched with a rider.

Even with these additions, Gojek’s services in Singapore are not as diverse as in its home market Indonesia, where if offers a variety of features ranging from ride-hailing to financial services. “Our ongoing focus remains on enhancing our ride-hailing offering here, but users can expect more exciting things to come as we continue to find new ways to keep Singapore moving,” Gojek Singapore general manager Lien Choong Luen told KrASIA via email.

Gojek cruised into the city-state in 2018, where it now offers GoCar, GoTaxi, and GoCorp. Meanwhile, Grab has extensive services including food delivery, courier services, online groceries, and fintech.

“On-demand services, like food and courier, is fueled by consumer desire for convenience. They make a lot of sense in a competitive and urban marketplace like Singapore,” said Lien, who hinted that the company could explore options in these sectors.

Amid the pandemic and intense ride-hailing competition, Lien is seeing positive growth for Gojek. “We believe choice is a great thing for both consumers and private-hire drivers in Singapore. It keeps everyone honest and leads to better services and experiences for users. Despite the ongoing restrictions, our daily ride volumes have been holding stable, indicating that riders in Singapore continue to choose Gojek,” he said.

Ride-hailing usage in Singapore is estimated to be at 32.6% in 2021 and is expected to reach 33.4% by 2025, according to Statista. Grab likely holds significant market share in the ride-hailing market, which makes it difficult for contenders to beat the company, said Phil Steggals, managing director of market research firm Kadence International in Singapore. “Gojek’s initial strategy in Singapore has been a price war with Grab, but the latter still appears to hold the biggest share of wallet when it comes to transportation. Gojek probably holds a position of many Singaporeans’ ‘back-up ride’—when Grab is too busy or more expensive,” he told KrASIA.

Adding new services like food delivery and logistics will add attractiveness and drive more demand for Gojek, but even these two sectors are already crowded in Singapore. Food delivery is dominated by major platforms like GrabFood, Foodpanda, and Deliveroo, while last-mile delivery service already has incumbents like GrabExpress, Ninja Van, and Lalamove. “Food delivery is a tough market, especially since there is a rumor that Shopee is looking to start a food delivery service here. It can potentially gain traction quickly as Shopee is a very strong e-commerce platform in Singapore,” said Steggals.

He added that new players in food and logistics need to offer unique offerings, lower prices, and tie-ups with major brands in order to drive demand. “Word-of-mouth marketing is big here. The good news for Gojek is that the brand has a good reputation in Singapore, but it needs to provide additional benefits in order to become the main platform, instead of the ‘back-up’ app,” Steggals said.

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