The Evolution of Indonesia’s Ride-Hailing Industry 

Indonesia’s most popular ride-hailing platforms are aiming to be trailblazers in the areas of delivery, hospitality, and even fintech.

July 2021 , by YCPS Marketing & Communication Group

Last May 2021 Indonesia’s most popular ride-hailing platform GoJek announced its merger with Tokopedia, a technology service company, to further expand its reach and range of services beyond its original value. The deal, according to The Jakarta Globe, will unify GoJek’s service-based platform and Tokopedia’s e-commerce marketplace to form GoTo, a new entity already estimated at a value of around 18 billion USD.   

GoJek’s rapid expansion comes to no surprise: 2018 data from Statista puts it at 79% market share in Indonesia, far beyond its closest competitors. Over the past few years it has expanded its services to include food delivery, courier servicing, and bill payments; the Tokopedia merger deal is slated to help its expansion towards a more “all-in-one” app approach. Grab, its closest local competitor, has also taken a similar path by branding itself as a “mega app.” 

The popularity of ride-hailing in Indonesia has led to the creation of a robust and thriving industry centered on providing affordable and accessible transportation for all. But with the onset of the COVID-19 pandemic, these platforms have had to shift towards other services—and are, with this change, creating an entirely new industry set to change the landscape of Indonesia’s economy. 

A Faster Pivot Due to COVID-19 
Both Grab and GoJek were already offering non-transport services prior to the onset of the pandemic, but it was the nationwide lockdown that allowed both platforms to pivot to other services with ease. With their ride-hailing features severely crippled due to quarantine restrictions, Grab expressed its intentions to grow its delivery services. In March 2020 The Jakarta Post reported that Grab would be focusing on its GrabMart grocery delivery feature, along with promoting its concierge assistant program GrabAssistant. GoJek also saw a similar downturn in its ride-hailing services and an increase in usage for its GoFood delivery platform and GoSend courier service.  

But while both apps’ focus on food and retail delivery helped recoup any possible losses, it was GoJek’s e-wallet feature, GoPay, that thrust it further into the number one spot. The 2020 lockdown saw a major increase in digital payment adoption, with e-wallets being the most popular method used by Indonesians. In fact, Bank Indonesia estimates the value of 2020 electronic money transactions at 201 trillion IRD (13.95 billion USD), growing by 38% from 2019.  

In December 2020, GoJek announced a 160 million USD investment in Bank Jago, a local technology-based bank. The partnership aimed to make financial inclusion a larger priority for the GoJek platform, and would allow GoJek customers to use the app to instantly open a Bank Jago account. The fintech boom not only allowed for constant flow of goods and services, it also allowed GoJek to expand into a new, untapped business segment. 

Opportunity in the Evolution of Ride-Hailing 
GoJek’s runaway success is also inspiring a new generation of Indonesian start-ups. The country boasts a youthful median age of 29.7 and no shortage in opportunities for business development as it looks to accelerate digital transformation across its rapidly urbanizing cities. Potential partners can look to the GoJek blueprint to develop their own platforms and businesses, and help Indonesia recover from the effects of 2020. 

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