Right technology will drive pricing down: Grab exec

Grab has been present in Vietnam for nearly a decade. Has the company reached all its targets?

I'm unable to delve into specific targets, but I can certainly share that we've maintained strong momentum throughout the years. When considering our objectives, I tend to focus on a broader, long-term perspective. As you may have noticed, Grab is a familiar presence in the city. However, in the grand scheme of things, there remains a substantial user base yet to embrace our services. Our ultimate aim is to become increasingly relevant and accessible to these users over time.

Our goal extends beyond merely encouraging more frequent use of Grab. It is about driving greater adoption of our full range of services. This, we believe, can pave the way for the realization of a genuine digital economy. In doing so, we become the preferred choice for our driver and merchant partners who are seeking to enhance their income streams.

What difficulties has Grab faced and how did you solve these problems?

First of all, as a company, it is difficult to know what the result will be when you launch a new service. For example, there is a possibility that we launch a service like the Saver delivery option and users adopt it, but they don’t use the service more. So, we “cannibalize” ourselves essentially, don’t we?

To address this, we adopt a measured approach. We experiment, conduct focus groups with driver partners and users, and carefully fine-tune the services based on user feedback and data analysis.

We need to go in with conviction, but we also need to go in with a learning mindset. Taking those lessons, fine-tuning them, and ensuring the final product drives the right results for all stakeholders on the platform is crucial. Grab's strategy involves constant innovation to provide users with products that are more affordable without hurting our driver partners’ incomes or our merchant partners’ revenues.

How does Grab intend to maintain its competitive edge in Vietnam as electric vehicles become more prominent in the mobility and delivery sectors?

First, let's talk about competition. I would say that there are few, if any, apps that can rival the wide array of services that we offer across such a vast geographic expanse. Consider food delivery apps or mobility apps; we encompass all that and more. We pride ourselves on being a one-stop shop, providing everything from food delivery and transportation to payments and parcel services, all under one roof. This aligns perfectly with the core tenet of our strategy, which is leveraging the ecosystem's benefits. Our goal is to be the ultimate destination for both consumers and drivers, emphasizing our unwavering commitment to serving the community.

In essence, our success hinges on this mission-focused approach and our diverse portfolio of services, which distinguishes us in the market. As we layer our affordability strategy atop this foundation, it expands the range of services we offer, catering to the diverse needs of our users. This approach provides accessible options for users across the spectrum, whether they are affluent individuals seeking premium services or students and emerging consumers who prioritize budget-friendly solutions over the luxury of convenience.

When it comes to EVs, we don't see them as competitors. While there are competitors entering the market with EV offerings, Grab has consistently embraced a pro-partnership attitude toward EV adoption across the regions we serve. This approach extends to Vietnam as well. We believe that our extensive network of drivers and geographic coverage creates a valuable opportunity for EVs and other partners to collaborate and establish their own ecosystems, with Grab as a crucial partner.

In fact, we have already initiated pilot programs with partners like Selex, which is about smart electric vehicles, focusing on 2-wheel EV programs. We remain dedicated to seeking additional partners to further expand these initiatives. Rather than viewing EV adoption as competition, we see it as a tremendous opportunity to extend our hand and collaborate with partners across the industry to foster the development of more sustainable and eco-friendly solutions.

The price of EVs is still higher than normal vehicles, so how can you still offer low prices for customers?

The best way to drive pricing down is to have the right technology that makes sure that the efficiency of the driver and the efficiency of the pickup are at their maximum level. If you can drive those efficiencies, you can start to bring pricing down because you need to compensate the driver less for their downtime.

In those inefficient moments, I'd say more generically, any players that want to be very competitive in this space need to find ways to manage that density well. We've seen many come and fail. They try to do it through promotions or unhealthy subsidies, and then they exit the market in Vietnam or others that we operate in. So really, it takes long-term, sustainable technological innovation.

With the focus on balancing between the driver and the consumer, you know we or any platform could bring pricing dramatically down tomorrow. But if it doesn't result in better efficiencies or productivity for the driver, there would not be any drivers on that platform. So it's all about finding the right balance with the right technology layered on top so that we can drive demand on one side.

Higher earnings for drivers in one way. For example, at Grab, I think between the first quarter and the third quarter of this year, we saw our driver partners actually grow their earnings on average by 5% monthly.

How is the growth of the Vietnamese market in comparison with others?

I am sorry that I cannot comment on growth. But I can say that Vietnam is a really critical market for us. It always has been. We've been here for nine years. It's one of the first markets we entered, and we have a huge commitment in terms of not only tech investment but also people investment in continuing to develop this market.

And not only that, Vietnam was also a source of many firsts. I think a fun fact that I can share here is that Grabbike originated in Vietnam. And if you trace back to the strategy that we're talking about today, why did we launch Grabbike? We needed to create more affordable options for our users back then.

And then, in turn, we created the platform for us to launch Grab Food, Grab Mart, and other services over the long term. So I see that Vietnam is actually a really interesting market to further enhance Grab's regional affordability strategy because the nuance is here, especially once we get into those cities.

I think Vietnam can help us inform and drive the tech innovations that we're creating. In fact, in August, we had about 30 of our tech leaders visit Hanoi. They have been interviewed by the media, and the whole purpose of that was for them to come and learn on the ground and understand how we can drive technological innovations that are really relevant to Vietnamese consumers. I think that is a really good representation of the commitment that Grab Regional has to develop the Vietnamese market. And so I'll focus more on the fact that it's a top-priority market with good traction and fantastic potential, and we'll continue investing in it.

What are Grab’s orientations for 2024?

I foresee next year will be a challenging year, but our ambitions remain unchanged. I think that we really want to make sure that we can become extremely relevant to users across the country.

You see that our core services, whether it's Grab Food, Grab Mart, Grab Car, or Grab Bike, will all be pushed quite heavily. So we want to penetrate better into the daily commute, for example, into how people move around, how people eat, and so on.