Many established firms areexpanding services such as food delivery, service hire, and shopping services.Source:https://www.vietnam-briefing.com/news/vietnams-ride-hailing-industry-trends
FOREIGN TRADE UNIVERSITY …… ***…… EXECUTIVE REPORT Grab - Vietnam’s Largest Ride-hailing Application, Strategies and Prospects Subject: Principles of Marketing Lecture: Nguyen Thi Thu Thao List of student Name Student Code Class Code Rate Tran Ha Khanh Linh 2215127003 K61MJ1 100% Le Dam Mai Thy 2215127007 K61MJ1 100% Le Thi Nhu Quynh 2215127025 K61MJ1 100% Doan Nguyen Quynh Nga 2215127027 K61MJ1 100% INTRODUCTION SITUATION ANALYSIS 1.1 Market summary 1.2 Demographics 1.3 Market Growth 1.4 Market Trend 1.5 Macro environmental factors that have impacts on the business (According to PESTLE model): Political + Legal .5 Economic Social Technological Environment 1.6 Competition (Market Share) .7 COMPANY INTRODUCTION .7 2.1 Mission 2.2 Vision 2.3 Sale 2.4 Cost 2.5 Profits MARKETING STRATEGY 3.1 TARGET MARKET ● CUSTOMER PORTRAIT: ● PAIN POINTS 10 ● CRITICAL SUCCESS FACTORS .11 3.2 VALUE CHAIN COMPARISON 12 ● VALUE CHAIN 12 ● CORE COMPETENCE 13 ● COMPETITIVE ADVANTAGES 13 3.3 POSITIONING .14 ● POINTS OF PARITY 14 ● POINTS OF DIFFERENCES 14 ● VALUE PROPOSITION (PRICE, BENEFITS) 14 ● PERCEPTUAL MAP 15 ● BRAND MANTRA 15 3.4 MARKETING MIX 15 CONCLUSION 19 REFERENCES 20 INTRODUCTION Ride-hailing services facilitate the connection between consumers and drivers to provide transportation through digital platforms, such as mobile apps This decreases the time for consumers to search for a service provider and negotiate a price Similar to other sectors in the digital economy, ride-hailing relies on network-based business models, where firms benefit from establishing and connecting a network of consumers and drivers The value for consumers is derived from factors like the service quality, convenience of use, and digital banking innovations Vietnam’s ride-hailing industry revenues could reach US$4billion by 2024, while it is forecasted to grow at a compound annual growth rate (CAGR) of 16 percent between 2020 and 2025 The industry has witnessed a surge in consumer demand, new entrants, and innovative products in recent years Many established firms are expanding services such as food delivery, service hire, and shopping services Source: https://www.vietnam-briefing.com/news/vietnams-ride-hailing-industry-trends-opportunitiesrisks.html/ Regarding ABI Research's analysis of Vietnam's technology ride-hailing industry for the first six months of 2020, Grab is the market's leading technology ride-hailing firm In the first half of 2019, the firm conducted 62.5 million trips, accounting for 74.6% of the market share, and marginally contributing 73% Gojek is steadily reducing the length of the Be Group, which is ranked second Be has 12.4% of the local ride-hailing market, while Gojek, from Indonesia, controls 12.3% The following report looks at the ride-hailing industry and provides a comprehensive overview of Grab as well as an examination of its operations in terms of parts: Situation Analysis Company Introduction Marketing Strategy Conclusion Tools of analysis include Market Trend, Growth, PESTLE, Market Share, Marketing Strategy and Marketing Mix Grab's analysis reveals its value chain and competitive advantages beyond industry averages In general, comparative performance is good at Technology, Quantity of Drivers, Strong Regional Presence, Safety and Security, Loyalty Programs, Localized Operations and Strategic Partnerships The report finds that Grab's prospects in its present position are favorable since it offers the shortest wait time, the greatest number of drivers, and the best technological quality SITUATION ANALYSIS 1.1 Market summary Asian companies predominantly rule the ride-hailing sector in Vietnam Following Uber's exit from the Southeast Asia region, including Vietnam, Grab – a Singaporean super app – emerged as the leading ride-hailing platform in the country, holding over 70 percent of the market share Additional major players include Indonesian Gojek (formerly known as GoViet) and Vietnamese startup Be Group The Vietnam Ride-Hailing Market is forecasted to grow at a CAGR of 22.10% between 2023 and 2028, reaching a market size of USD 2.61 billion by 2028 The COVID-19 pandemic disrupted numerous industries, including transportation, and impacted the Vietnam ride-hailing business However, when COVID-19 cases diminish, the market stabilizes, and ride-hailing service use among passengers increases The ride-hailing companies have improved options and expanded operations to be offered in mobile applications The shift has the potential to enhance public charging infrastructure and increase consumer exposure to EVs Consequently, Hanoi is expected to grow at a higher rate than other cities in Vietnam 1.2 Demographics 1.3 Market Growth The revenue of the ride-hailing and taxi segment in Vietnam increased slowly from 2017 to 2019 from 2.6 to 3.1 million US dollars before falling to 2.1 million US dollars in 2020 The plummeting of the revenue in 2020 was explained by the impact of the COVID pandemic However, in the context of the epidemic and social distancing, to retain customers and maintain operations during the pandemic, many businesses have promoted the development of delivery and market and household services in 2021 The revenue of the ride-hailing and taxi segment in Vietnam will increase in 2021 to reach 3,115 million US dollars, and growth was stable in the following years and predicted to reach 4,5 million US dollars in 2025 The Vietnam Ride-Hailing Market size is expected to grow from USD 0.96 billion in 2023 to USD 2.61 billion by 2028, at a CAGR of 22.10% during the forecast period (2023-2028) 1.4 Market Trend 1.5 Macro environmental factors that have impacts on the business (According to PESTLE model): Political + Legal The Ministry of Transport's pilot plan to use science and technology to manage transport activities under contracts in 2016 led to the development of the technology taxi model, pioneered by Grab This allowed Grab to increase its market share and driver numbers However, due to unclear policies between technology providers and transportation businesses, Grab does not face taxes, business conditions, logos, employee taxes, or driver training This caused a growing conflict between technology cars - Grab and traditional taxis - Vinasun The Ministry of Transport has stopped the pilot phase of Grab and established a new legal corridor, Decree 10/2020, effective April 1, 2020, to promote competition and promote long-term business operations Economic Vietnam has achieved significant achievements in economic development and improving people's lives However, as the majority of Vietnamese people are still at the middle and low income with an average GDP per capita of 3,759 USD, Grab difficulty determines what types of services suit their budgets when forming business strategy Then, they solve problems by adapting products and services to the local area, offering low-cost services to the market Grab can still conduct business in Vietnam and be profitable that suits the economic situation and affordability of consumers Document continues below Discover more from: Principle of Marketing MAR 211 Trường Đại học… 999+ documents Go to course International 22 15 59 51 marketing strategy… Principle of… 97% (97) 200 câu trắc nghiệm Marketing có đáp án Principle of… 96% (813) Phan tich chien luoc marketing TH Principle of… 100% (21) PHÂN TÍCH CHIẾN LƯỢC MARKETING… Principle of… 97% (60) 41 Chapter 12 - Test bank Social Principle 100% (16) In 2014, GrabTaxi was launched in the Vietnamese markets of Ho of…Chi Minh and Hanoi However, regarding VTV statistics, the number of motorbikes in Vietnam in 2018 reached more than 58 million vehicles and account for 86% of motorbikes participating in traffic in 2019, showing that the demand for motorbikes in Vietnam is the main one Grab has quickly deployed GrabBike service toMarketing integrate into CĂN BẢN society Principle of… 100% (16) While Uber allowed only people with credit cards to use Uber's services in order to control cash flow, the habit of using cash at that time was still the most popular in Vietnamese consumer culture Thus, Grab lets consumers pay in cash when entering the Vietnamese market, which makes them more willing to use the service Finally, a large number of consumers have been sucked away by Grab Technological According to Statista's survey in May 2021, Vietnam is in the top 10 countries with the highest number of smartphones in the world, about 61.3 million As the cost of using 3G, 4G and Internet in Vietnam is the cheapest with 3,000 VND/GB of high-speed 4G, Grab can strongly approach customers In the 4.0 era, online payment methods are gradually expanding, Grab deploys many other methods such as ATM cards, credit cards, Momo and Moca e-wallets to help customers pay conveniently and quickly Especially the birth of GrabPay, GrabPay Credit, Grabchat shows that Grab thoroughly applies technology to services Environment Grab's environmental performance is a key consideration in its expansion plans in Vietnam As a leading ride-hailing platform, Grab potentially impacts air quality, traffic congestion, and other environmental factors in the countries However, the company has shown a commitment to addressing these issues through initiatives by reducing its carbon footprint and promoting sustainable transportation solutions 1.6 Competition (Market Share) In Vietnam, Grab remains the leading platform accounting for 73% of the market share in 2019 The following positions are Be with 16%, Gojek with 10% respectively COMPANY INTRODUCTION 2.1 Mission In 2019 in Jakarta, Indonesia, Grab set the goal of implementing the mission "Technology for Community" according to the roadmap to 2025 2.2 Vision In 2018 in Ho Chi Minh City, Grab officially announced: "Smart city aims for a future that includes seamless transportation, food delivery, logistics, and non-cash payments for Southeast Asia people through one app.” 2.3 Sale Grab Vietnam's revenue in 2018 reached 2,194 billion VND and increased to 6,384 billion VND in 2022 In recent years, Grab Vietnam has generated about 19,067 billion VND in revenue 2.4 Cost 2.5 Profits In 2022, Grab Vietnam achieved revenue of 6,384 billion VND and pre-tax profit of 329 billion VND Previously, Grab Vietnam's first profit was in 2020, reaching 243.4 billion VND Grab’s users in Vietnam Cre: Statista - Demographic: Grab's overall target is Vietnamese people of both genders First segment is the 25-50 age range, who are middle to high-income earners such as self-employed, working professionals, jobless, and retirees The second target market focuses on those aged 18 to 24 with occupations such as students, part-time workers, and employed - Geographic: Grab capture their target audience all densely populated urban cities in Vietnam like Ho Chi Minh, Hanoi, Bac Ninh, Quang Ninh, Hai Phong, Hue - Da Nang, Lam Dong, Bien Hoa - Vung Tau City, Ho Chi Minh City, Can Tho City, Depending on the location, Grab applies transportation services with different prices (Lich.H., 2017) - Psychographic: Grab’s primary target market under psychographic factors will be self-actualizers (A Maslow, 1943), who prioritize their wants to enjoy the ride, not just as a means of transport On the other hand, the secondary target market are pleased conformers whereby they prioritize their needs over wants, where the rides are essential ● PAIN POINTS After conducting a survey to find out customer’s pain points, here are the results: 10 - Driver Availability: Depending on the time of day and location, users may sometimes find it challenging to secure a ride promptly, leading to longer wait times Safety Concerns: Users may worry about the behavior of drivers and the security of their rides, especially commuting at night Surge Pricing: High demand periods often makes rides more expensive, which affect cost-conscious customers Payment Methods: Issues with cashless payments or misunderstanding the payment process can lead to difficulties for customers Inaccurate Addresses: Users providing inaccurate pickup or drop-off locations causes confusion and delays for both drivers and passengers ● CRITICAL SUCCESS FACTORS As Tam et al (2018) studies about Grab overtaking Uber: There are three turning points with provided by three success factors to explain Grab achievement over time as follow: - Partnership with local taxis: Grab firstly encountered the company with 30 taxis, the first partner and the first group of drivers using their platform At first, there was no local ride-hailing regulation, Grab played a vital role for linking between licensed taxi drivers, private freelance drivers, and customers by themselves as they attracted more drivers and built trust from local ventures (Lee, 2014) - Solving real social pain points: Grab originally addressed safety and service quality issues in the industry Unlike Uber mainly serving high-end customers (Tam et al, 2018), Grab accepted cash payments and produced real-time location sharing, an emergency button to contact the nearest police station - Positioning brand consistent with target customers: Grab positions itself as a casual brand, Grab wanted people to remember them with a distinctive green color It ranges from the brand identity to the drivers' uniform, giving the viewer a sense of closeness and friendliness - Technological innovation: Grab makes use of technology to provide clients instant trip booking, position-tracking of the car, fare and simple payment 11 3.2 VALUE CHAIN COMPARISON ● VALUE CHAIN Grab Inbound Logistics + Connects drivers with passengers + Includes the development and maintenance of the Grab app, as well as the infrastructure required to support the platform Be Group Gojek + Be is making efforts to attract more drivers by establishing a community of Be drivers with many preferential policies It can be said that this is a highlight of Be + Managing and onboarding drivers, ensuring the availability of vehicles, and coordinating the delivery of goods and services Operations + The coordination of transportation services between drivers and passengers helps manage ride requests and ensures smooth platform operations + Be Group has Vietnam Prosperity Joint Stock Commercial Bank (VPBank Code: VPB) - one of Be Group's strategic partners behind financially supporting this start-up and operations + Matching of drivers with passengers or delivery orders, managing the digital platform, infrastructure, and ensuring a smooth, efficient service experience Outbound Logistics + The distribution of data and information between drivers and clients to provide real-time updates on ride requests, driver locations, and arrival times estimation + Exchange and give feedback between the consumer and Be Group during the service usage via the Be application + Gojek's digital platform facilitates the coordination and tracking of the timely and accurate transportation or the delivery of goods Marketing & Sales + Focus on attracting and retaining both drivers and passengers, including advertising campaigns, promotions, and loyalty programs + Focus on a digital banking model to provide banking solutions for customers on the platform + Focus on attracting both drivers and customers to use the platform via advertising campaigns, referral programs, partnerships with merchants, and promotions Services + Providing a seamless and convenient experience for both drivers and passengers with customer support, dispute resolution, and ensuring the safety and quality of the transportation services offered + Cooperate with airlines, hotel groups, bus, train, to provide multimedia solutions, one schedule, one payment to become Vietnam's national transport platform in the coming years + Offering motorbike ride-hailing (GoRide), courier (GoSend), and personal shopping (GoMart) services 12 ● CORE COMPETENCE Connect many drivers, wide coverage everywhere: + Increase convenience for customers in terms of traffic jams and rush hours, many Grab drivers in many places save time traveling and waiting for customers - Technology Capacity: + Grab integrates many features on one application, such as food-drinks ordering, delivery, driver connection as well as offers a range of payment and financial services with mobile wallets, digital payments, even financial products like insurance and loans - Reasonable Service: + Unlike traditional taxis with fixed human resources, Grab is creative in applying the sharing economic model, using available resources, Grab drivers are freelancers and have the means, so Grab does not need to pay a lot of money to buy a car for consignment => These factors help Grab become Southeast Asia's leading super app, with a wide user base and a valuation of over $10 billion By offering multiple services through a single app, Grab aims to provide a seamless and integrated experience to its users - - - - - ● COMPETITIVE ADVANTAGES Strong Regional Presence: + Grab operates in multiple countries across Southeast Asia, including Singapore, Malaysia, Indonesia, Thailand, Vietnam, and the Philippines This extensive regional presence gives Grab a wide customer base and allows it to leverage economies of scale The number of the driver is large: + Comparing in terms of income and bonus discounts between Grab, GoJek, and Be in the market, Grab will be slightly better because Grab's cost per ride will be higher Because of high fares, Grab drivers' income is also higher than that of their two competitors Hence, the number of recruit drivers of Grab is very large Safety and Security: + Prioritizes safety and security measures for both passengers and drivers It implements features such as driver background checks, real-time GPS tracking, and an in-app emergency button These measures help build trust and confidence among users Customer Loyalty Programs: + Grab has implemented customer loyalty programs such as GrabRewards, that offer benefits and discounts to loyal customers to foster customer retention 13 - - Localized Operations and Strategic Partnerships: + Grab has formed partnerships with various organizations, cooperates with many local companies and has strong strategic partners, helping them take full advantage of specific markets and optimize services + For instance, it has collaborated with financial institutions to offer digital payment solutions and with local governments to provide transportation solutions for underserved areas + With Moca wallet on Grab app, the payment is settled automatically, so it can get off and get going as soon as it reaches its destination + It offers motorcycle taxis (known as GrabBike) in countries where they are popular and adapts its services to comply with local regulations High-technology: + Grab incorporates GPS technology to provide accurate and efficient navigation for drivers + Grab utilizes advanced algorithms to efficiently match drivers with passengers and delivery partners with customers These algorithms consider factors such as distance, availability, and other relevant criteria to optimize the experience for both drivers and passengers So, it can minimize the time of waiting during rush hours 3.3 POSITIONING Grab strives to be a superapp, providing customers the greatest services in the quickest amount of time ● POINTS OF PARITY Famous technology companies offer ride-hailing services and expand its products including food, grocery and package deliveries through online applications ● POINTS OF DIFFERENCES - High discount and incentive policy - Ride more and flexibly transportation methods - Short waiting time - High technology (location, application, map) ● VALUE PROPOSITION (PRICE, BENEFITS) Every organization tends to provide value to their clients and partners in one or more ways Grab has made its mark in the market - It provides on-time trips and can be scheduled online without any trouble - Customers and companies use an app to access secure and dependable financial services such as loans, online transfers via e-wallets, insurance, and so on - Grab hopes to address customers' economic difficulties by striving for an Everyday Everything App for people of Southeast Asia - Service providers such as drivers and delivery men will benefit from the additional revenue 14 - Allowing and giving incentives in the form of awards, presents to other consumers Parcel, meal, and daily grocery deliveries are all made at the customer's specified time intervals ● PERCEPTUAL MAP ● BRAND MANTRA “Whateveryouneed,justGrabit!” Freedom - Safety - Liberality 15 3.4 MARKETING MIX GRAB PRODUCT BE GOJEK - GrabCar - GrabCar Plus - Be Car - BeCar Rent - Go Ride - GrabBike - GrabBike Plus - Be Taxi - Green SM Taxi, Green SM Lux - GoCar - GoCar XL Protect - Grab Taxi - BeBike - Green SM Bike - Grab Economy - Be Delivery - GrabExpress, Grab Food - Be Food - Grab Mart, Grab Gifts, GrabPay, GrabPay Credits - Be Flight Booking PRICE Priceatrushhour(7pm) withthesamelocation anddestination Priceatrushhour(7pm) withthesamelocationand destination 16 - Gosend - GoFood Priceatrushhour(7pm) withthesamelocationand destination Grab offers rapid rides at a reasonable rate and implements a dynamic pricing model for its service which adjusts their prices within seconds Be provides affordable and most competitive prices Despite rush hours and the bad weather, Be still maintains the same price instead of raising it Besides, Be offers “Be Loyalty” which creates special offers and benefits for users using services on Be applications Additionally, Grab offers member benefits to honor customers GoJek firstly used the competitor-based pricing method which is cheaper than Grab 10% to 30% Then, employing a market penetration pricing approach by giving incentives and promotions Lastly, Gojek used a dynamic pricing model after 17 establishing a strong market position PEOPLE (Number of Drivers) PLACE 250.000 (Waiting time: 3-5 mins) Indirect Distribution Customers easily and quickly use Grab services through the Grab app on their own devices 100.000 (Waiting time: Max 15 mins) Indirect Distribution Be Group gives services via the enterprise's mobile application Be uses the customer's Grab analyzes the previous location to find the closest passenger records then drivers informs drivers to go to the main passenger area PROMOTION Grab affects customers' emotions and perceptions through advertising campaigns and social media marketing Be Group runs marketing campaigns on websites, applications, and social media platforms These campaigns develop connections with clients, especially the youth “Tạm biệt năm cũ, đón năm đủ” Marketing Stunt A Grab commercial TVC offered the message "Thank you for a year together" when discussing Covid-19 pandemic It was a year where prosperity is no longer important and no one is left behind Grab advertisements are always filled with sympathetic stories that keep them in Source:Facebook the public's hearts “Grab liên hồn Deal – Cần chiều” Building creative, limited, even sensational experiences for customers like ‘Berow 18 200.000 (Waiting time: Max 10 mins) Indirect Distribution Customers with their personal devices can find and download Gojek’s app with no difficulty Gojek assesses the customer's location and recommends peak hours, locations with high travel demand to drivers Online marketing is a technique in Gojek's marketing strategy that cares not just about its customers and partners, but also about contributing to society "Antibacterial X3" GoCar vehicles are all equipped with air purifiers with the message "Antibacterial X3 - Safe with GoCar" to enhance protection for users on every trip The launch campaign collabed with Ambassador Son Tung M-TP This combination brings Gojek's