The story of Go-Jek
People in Jakarta, Indonesia’s capital, spend on average the equivalent of ten years of their lives commuting. The best way to avoid three hours in peak-hour traffic jams is to use the ojek, a motorcycle taxi.
Go-Jek started as an ojek-ordering call centre. In 2014, the Go-Jek smartphone app was launched in order to generate a network effect and keep drivers busy outside the rush hour. Thus the basic taxi operations were supplemented by couriers and meal delivery services.
Broadening the scope
More new services were soon added: grocery delivery, cleaning service, booking of spa treatments. Recently, Go-Jek also moved into the fintech field and is now offering an e-wallet (approximately 64% of Indonesians have no access to banking services), according to a report on the INSEAD business school website.
Lessons to learn
- While Uber spent money on promotion and price cuts, Go-Jek focused its marketing efforts on drivers. It carried out driver recruitment events at basketball stadiums, thus suddenly acquiring drivers in their thousands.
- Uber regards its drivers as independent contractors. Go-Jek, on the other hand, wants them to feel like an integral part of the organisation and even provides a loan to drivers who can’t afford a smartphone.
- Understanding the local environment has helped as well. By concentrating on the ojek, Go-Jek avoided direct competition with existing taxis and also circumvented national transport regulations (which apply only to four-wheeled vehicles).
- When the Ministry of Transportation banned such transport apps, the Indonesian president overturned the ban. The political capital of the organisation has also proved useful: it is now perceived as a patriotic symbol.
What comes next? The app wants to expand to the Philippines and Thailand, both of which face similar logistical challenges with severe traffic jams.
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