Indonesia's Super App Bettering Lives of 2 Million Partners

GO-JEK

3. Good Health and Well-Being 8. Decent Work and Economic Growth 9. Industry, Innovation and Infrastructure

Overview

Through their courier and ojek (two wheeled transportation) ride-hailing services in Indonesia, Go-Jek revolutionized the transportation service industry in a country where mobility was limited and in need of improvements. Ojeks, or motorcycle taxis, are a common way to get around in Indonesia, where traffic can be extremely heavy. Go-Jek’s founder and CEO, Nadiem Makarim noticed the value ojeks added to Indonesia’s economy and local citizens, and he recognized a need to improve on this sector. The introduction of Go-jek gave communities better access for commuting, and it also gave ojek drivers greater access to customers.

By providing professional training and employment protection for previously informal workers, GO-JEK helps improve societal welfare. On top of that, contributing 3 Billion USD into Indonesia's economy as of 2018 improved its economic growth. Finally, through Innovation becoming a crucial role in people's and business' operations, GO-JEK has become a leader in technological innovation in Indonesia.

Authors

ariel wibowo

ariel wibowo

Esther Indiarto

Esther Indiarto

Tungga Basuki

Tungga Basuki

Grace Trask

Grace Trask

School

Loyola Marymount University

Loyola Marymount University

Professor

Jeff Thies

Jeff Thies

Innovation

Evolving and expanding from a simple call service, the launch of the Go-Jek app in 2015 provided ride sharing services, both with ojeks, and with cars, in an accessible, efficient, and easy to use manner. Continuing to evolve and grow beyond simple ride sharing and transportation, the app has become known as a super app. The Go-jek app is more than just an app, as it includes what typically would be found in many separate apps all under one platform. The app provides users with nineteen services spanning across multiple industries, and this number will only continue to grow. Go-jek has expanded beyond transportation and delivery services to laundry, house cleaning, and even home spa and massage services. The company even has their own e-money and mobile payments service, and a customer loyalty program, all available through the Go-jek app. As the company states and Siti Astrid Kusumawardhani reiterated, “Today, Go-jek has expanded, providing various products and services to cater different customer needs.” The amount of life improving services provided all fully integrated into one extraordinary application is an incredible accomplishment. Rather than having separate apps for Go-jek’s food delivery service and for Go-jek’s ride hailing service, both can be found in the same place. The same goes for every other Go-jek service. The app is basically its own virtual ecosystem of many uses and functions in one that allows customers in need of a basic service to easily find, connect, and communicate with local workers who will provide that service. A large team of designers, engineers, researchers, product managers, and other specialists joined forces and came together to develop the super app that could not have been done without specialists in many different areas. The team, which is led by Go-jek’s current Chief Technology Officer, Niranjan Paranjape, and consists of over two hundred engineers, works to make constant improvements and updates to the app.

A big component of Go-jek’s mission is to strengthen the daily lives of users and resolve everyday problems through technology, which goes beyond the services provided to users, but also includes strengthening the economy and providing over one million jobs in Southeast Asia. Go-jek has now expanded outside of Indonesia to Vietnam, Singapore, Thailand, and the Philippines, so the company is having a positive economic impact in multiple countries and over 200 cities. In addition to giving partners greater access to customers and creating new jobs for partners, Go-jek also focuses on improving the overall wellbeing and livelihoods of their driver partners. Welfare programs including insurance, education plan savings, low-cost credit packages, financial services, and other benefits are offered to driver partners through the Swadaya Program. Through the Go-jek app, the company can continue to innovate by providing additional services to consumers, and continuing to make technological strides that improve the lives of Go-jek partners and the millions of people using their app each day.

Indonesia's Super App Bettering Lives of 2 Million Partners

Inspiration

The founder, Nadiem Makarim himself has always been a regular user of motorcycle taxis (ojeks) to make deliveries and collect food for him. He thought ojek was very useful in avoiding Jakarta’s traffic that can get very bad most times of the week. However, at the same time, he also felt that sometimes it can be hard to hail an ojek when all of the ojeks that he personally knew are not available. Unlike taxis, ojeks are self-employed and most of the times are not under the supervision of a company, thus the only way to utilize ojek is to hail available ojeks that happen to pass by your area or call ojeks that you’ve used regularly. Because of this, Nadiem also mentioned that a lot of people were concerned and did not believe that ojeks could be professional and could be trusted, which definitely was something that he took into consideration before deciding on making Go-Jek not just a business idea and turning it to a reality. This was when the idea of changing the conventional way of hailing ojek came about. He was determined to change this perspective through Go-Jek. Hearing ojek driver's personal stories also made him realize how valuable and important this informal sector actually was to the country’s economy. Being an ojek can be a good part or full time job that still pays well and convenient for the part of the economy that are still struggling and/or needs extra cash. At the minimum, it can help people survive through the month until they get their next paycheck. Go-Jek therefore was created in seeing how beneficial it can be for both the customers and ojek drivers and that according to an interview with CNBC, Nadiem mentioned that “we built a product around the frictions that an average person experiences in their day to day life."

Overall impact

Gojek has impacted Indonesia in a big way through its innovations, affecting business, society, and the environment. Under the innovation, Go-jek has addressed a couple of different UN’s Sustainable Development goals, Decent work and Economic growth, Good health and Well Being, and industry, innovation, and infrastructure.

Gojek has improved the Indonesian economy, contributing almost $720 million USD annually towards the Indonesian economy. Go-jek helps the economy through its features, one of them being the Go-Food feature, which has improved partnered SME’s sales. 86% of Go-Jek’s SME partners has experienced a 5% increase in sales after partnering with Go-jek. The company is also helping businesses diversify their streams of income through Go-Food, getting revenue from deliveries instead of only retail or in shop purchases. Go-jek has expanded their operations to other south east Asian countries such as Thailand, Vietnam and the Philippines, improving sales for businesses in these countries, and eventually affecting economy in a positive way.

Having 1 million driver partners (77% of them being in between the ages 20-39 years old), has helped decrease the level of unemployment in Indonesia, and even increasing the average income for drivers to Rp. 3,31 Million opposed to the Rp 2,80 Million minimum wage workers receive monthly. Not only has Go-jek increased their drivers’ purchasing power, but they have also created the Swadaya program to give benefits for its drivers. The Swadaya Program gives benefits such as insurance, low cost credit packages, and education plan savings for Go-jek drivers. Go- has has also impacted the society, through increasing the worker’s quality of life through the flexibility of working hours for the drivers, giving these drivers family time.

Gojek has impacted the environment through increasing the overall welfare for the Indonesian people by providing jobs, and helping micro-entrepreneurs succeed through their Go-Food Feature. In just 3 years of launching the app, Go-jek currently has over 1 million drivers working under them while providing benefits, through the Swadaya program, and higher wages than the standard minimum. Go-jek has given jobs to more than 30,000 people who has never been able to get a job due to reasons such as physical limitations, and lack of education. Becoming Go-jek drivers help people,who were not able to work previously, earn money and be more productive to improve their standard of living. Gojek has also helped Micro-entrepreneurs to be more innovative through the App’s features. Using the Go-Food feature Entrepreneurs now are able to sell their products easier by partnering with go-jek and getting free advertisement by listing their businesses on the app. Gojek allows for a more positive work environment for indonesians by fostering the entrepreneurship spirit within Indonesians to develop new and interesting products, and creating jobs for people to form a more productive workforce.

Gojek has impacted the Indonesia in a positive way, both in the short term and in the long term. The short-term effects Go-jek has shown is the ability for Indonesian to have access to ride sharing services. The company’s go-Ride feature has given Indonesians to travel in a more time- efficient way by riding motorbikes, instead of cars, so that people can maneuver around traffic and reach their destinations faster. Also Go-jek has improved the Indonesian economy, adding $3 Billion USD in just 3 yearsfrom the introduction of the app. Long term benefits that Go-jek provides will be improving Indonesians’ living standards through providing jobs and benefits to their workers. Increased wages will have a snowball effect as people will now be able to afford a better education, leading to better jobs for the future generation. Go-jek also helps Indonesians live an easier life by being able to take care of errands and requesting for services from their smartphones.

Business benefit

Go-Jek has benefited businesses both internally and externally in Indonesia. As an evolution of what started as a logistics and ride hauling company in 2010 that focused on two-wheeled vehicular services, Go-Jek established their mobile application in 2015 which completely changed the direction the company went. Since the year the mobile application was established, logistics and ride-hailing was no longer their only source of cash flow, expanding to services that catered to everyday household and business necessities including business to consumer deliveries (Go-Food), business to business deliveries (Go-Box), and consumer to consumer deliveries (Go-Send).

Awarded as the first unicorn startup from Indonesia, Go-Jek has accumulated about 2 million drivers that work in Indonesia and 300,000 GO-FOOD merchants (97% being micro, small, and medium enterprises). Both of those attributes make up majority of Go-Jek’s 2 billion total transactions by end of 2018. Those attributes may justify why the company is being valued at 5 billion USD by the end of 2018.

Now, Go-Jek has expanded to partnerships with services with other employees to establish services that make up GO-LIFE, which caters to household help such as Go-Massage, Go-Clean, Go-Fix, and Go-Laundry to name a few. 19 Services make up Go-Jek’s business model all under either the Go-Jek app or Go-Life app. On top of the 19 services, Go-Jek also has cash flow from 1 e-money program and 1 loyalty program which helps customer retention by providing more incentives to use services provided by Go-Jek. Go-Jek’s cashless service named Go-Pay, incentivizes customers to use Go-Jek’s wallet service to pay for Go-Jek products because it usually has discounted prices. The loyalty program is very straightforward, you can get points for each transaction depending on the size and exchange it for coupons or gift cards, depending on what the merchants available are offering.

Externally, Go-Jek has been the life and blood of daily operations of many MSMEs (micro, small, and medium size enterprises). Besides MSMEs, Go-Jek is also the main form of delivery for business to consumers for all the large e-commerce sites in Indonesia, including Tokopedia, Bukalapak, and Shoppee.

GO-JEK has directly benefited the growth of MSME in Indonesia due its technology that increases consumer awareness of the MSME, the ease of processing transaction from point of sale to the home deliveries, ultimately leading to MSME merchants reporting an increase of an average of 345% in earnings/sales recorded by GO-FOOD partners.

Social and environmental benefit

What Go-Jek boasts within their societal benefit seemed to be the shift of consumer perspective that prior to the startup’s mobile application. The employees they work with, called ‘ojeks’ in Indonesia (where they got the name Go-Jek from) are self-employed two-wheel transporters who can be asked to take passenger to places or ask them to deliver things. Initially, ojeks are often seen as unprofessional and inconsistent because it was a job very accessible for most of the population, regardless of education. Ojeks has always been essential as a mode of logistics for Indonesia’s economy, but it was never conveniently accessible and reliable as it is now.

Now Go-Jek boasts 1.7 million two-wheel transporters, all wearing Go-Jek’s trademark light green colored jackets and helmets, processing 100 million transactions per month. As for the drivers, based on the fact sheet per March of 2019, “100% of driver partner’s quality of lives have increased.” For all driver partners of Go-Jek, between Go-Ride, Go-Life, and Go-Car, all had experienced monthly incomes above the minimum wage, ultimately leading to 8/10 partners claiming they can now send their children to school. In the grand scheme of things, 1.7 million drivers can also translate to 1.7 individuals getting educated and receive new skills that may propel them in the long run. Being technologically literate, develop people skills by meeting dozens of businesses and consumers on the daily, and experiencing a professional working environment, can improve the quality of life of the partners beyond their time with Go-Jek.

Interview

Siti Astrid Kusumawardhani, VP of Public Affairs

Keep this story going! Share below!

GO-JEK

GO-JEK

Jakarta, Greater Jakarta, ID

Business Website: www.go-jek.com

Year Founded: 2010

Number of Employees: 1001 to 5000

GO-JEK is a Super App that has 18 Application in one. Started off as a call center in 2010 that connected 'ojeks' (two-wheeled drivers) to consumers, developed a mobile app to do the same in 2015. The Mobile App became an essential for Indonesian's lives, serving all sorts of logistics that help business to business, business to consumer, and consumer to consumer. Now GO-JEK has apps that help with life's convenience, including cleaning service (GO-CLEAN), food delivery (GO-FOOD), cashless wallet (GO-PAY), and even home massage (GO-MASSAGE).