Ride-hailing was hit hard by COVID-19. Grab’s Russell Cohen on how the company adapted. – ProWellTech
Ride-hailing services around the world have been hit hard by the COVID-19 pandemic, and Grab was no exception. The company is one of the most popular tech startups in Southeast Asia, where it operates in eight countries. Its transportation business suffered a sharp decline in March and April, following the implementation of movement limitation orders.
But the company had the advantage of already managing several logistics services on demand. During Disrupt, Russell Cohen, chief executive of operations at Grab’s group, talked about how the company adapted its technology to an unprecedented crisis (video is embedded below).
“We sat as a leadership team at the beginning of the crisis and we could see, particularly in Southeast Asia, that the scale of the challenge was so immense,” Cohen said.
Grab’s driver app already allowed them to toggle between car delivery requests and on-demand delivery requests. As a result of COVID-19, more than 149,000 drivers have started making on-demand deliveries for the first time, with Singapore, Malaysia and Thailand having the most conversions. That number included tens of thousands of new drivers who joined the platform to recoup the earnings lost during the pandemic.
The challenge was to upgrade its delivery services to meet the dramatic increase in demand from consumers and even merchants who needed a new way to reach customers. In March and April, Cohen said just under 80,000 small businesses joined his platform. Many had never sold online before, so Grab accelerated the release of a self-service feature, making it easier for merchants to embark on their own.
“This is a huge sector of the Southeast Asian economy that has actually been digitized in a matter of weeks,” Cohen said.
Many of the new merchants had previously only accepted cash payments, so Grab had to set them up for digital payments, a process made easier because the company’s financial unit, Grab Financial, already offers services like Grab Pay for cashless payments. mobile wallets and remittance services.
Grab also released a new package of tools called Grab Merchant, which allowed merchants to build businesses online by submitting licenses and certifications online, and includes features such as analytics.
Modeling for uncertainty in the “new normal”
Part of Grab’s COVID-19 strategy involved partnering with municipalities and local governments in several countries to make deliveries more efficient. For example, it partnered with the Singapore government to expand a pilot program, called GrabExpress Car, originally launched in September, which enabled more vehicles than Grab to be used for food and grocery deliveries. Previously, many of these deliveries were handled only by motorcycles.
The situation in each of Grab’s markets – Singapore, Cambodia, Indonesia, Malaysia, Myanmar, Philippines, Thailand and Vietnam – is still evolving. Some markets have lifted block orders, while others continue to face new outbreaks.
Cohen said ride-hailing is gradually recovering in many of Grab’s markets. But the company is preparing for an uncertain future by modeling different scenarios, taking into account potential closures and lasting changes in consumer and merchant behavior.
“Unpredictability is something we think about a lot,” Cohen said. Its models include those in which deliveries are a much larger part of its business, because even in countries where movement restrictions have been lifted, customers still prefer to shop online.
COVID-19 has also accelerated the adoption of digital payments in several Grab markets. For example, Grab launched its GrabPay card in the Philippines three months ago, as more people are starting to use contactless payments in response to COVID-19 concerns.
In terms of on-demand deliveries, the company is expanding its same-day courier service, GrabExpress, and is adapting the technology originally created for ride-pooling to help drivers plan pickups and deliveries more efficiently. This will help reduce the cost of delivery services as consumers remain price-conscious due to the economic impact of the pandemic.
“Buying behaviors have changed, so for us, when we think about the supply side, the driver side, that means we need to make sure our fleet is flexible,” he said.