Digitalised modes of transport have been prevalent in today’s contemporary society, especially with the emergence of GO-JEK which have revolutionised on-demand services. This innovative company has caused disruptions and transformations on the digital gig economy by utilizing internet platforms and technologies to better facilitate service providers across the Indonesian Archipelago.
The first part of the essay will dive into the general operations of GO-JEK as well as the history behind the origins of this highly successful ride-hailing application. This essay also discusses GO-JEK’s business model, internet ecology and how it challenges and disrupts existing norms through internet transformations.
What is GO-JEK?
GOJEK. A Super App. by Life at GO-JEK
GO-JEK is a multi-service app that started off as an on-demand transportation business. The name GO-JEK derived from the word “ojek” – which means unlicensed motorbike taxi in Indonesian – as motorcycles are viewed as a prominent mode of transportation amongst locals.
The Indonesian based app enables motorcyclists to sign up as registered ojek drivers, allowing the effective matching of various gig works across different services with their customer’s demands via the online platform (De Ruyter & Rachmawati, 2020). The company is part of the ‘gig economy’, which Wood et. Al (2019) theorised as an economic emergence towards platform work transacted online but delivered locally, requiring the physical presence of the employee.
Following their huge success by 2016, they adopted 12 separate services ranging from logistics and couriers via GO-SEND, grocery and shopping services via GO-SHOP, to lifestyle services such as on-demand massages via GO-MASSAGE (Ford & Honan, 2017) possible through which Malawani et. al (2020) described as a unique phenomenon of human-computer interaction’.
History of GOJEK
GO-JEK began as a motorbike booking call centre back in 2010 that aimed to connect prospective customers with ojek drivers more effectively by telephone. The founder, Nadiem Makarim, developed this concept whilst observing the ineffective exchange of motorists and consumers– drivers would wait long periods of time for potential customers, while customers spend time looking for these ojeks therefore, wasting both parties’ time and productivity.
Hence, GO-JEK’s purpose was to better improve the connectivity and efficiency between riders and consumers as well as to provide alternative transport services in major cities like Jakarta that still lacks pedestrian facilities and public transport coverage (Saffan & Rizki, 2018). Makarim also hopes to provide solutions to Jakarta’s congestion problems by encouraging a habit shift from using private vehicles to public transport like online ojek (Suatmadi, et. al, 2019).
The company became a mobile-based application in 2015, launching new services outside on-demand transport and began expanding its market and recruits (Prananda et.al, 2020). However, allegations arise regarding the unregulated area of ‘online transportation services’, local authorities questioned GO-JEK’s lack of strict supervision by the government – that led to the condemnation of their operations in Padang, and to a greater extent a short ban by the Transport Ministry in 2015 (Azzuhri et. al, 2018).
Their pervasiveness resulted in massive demonstrations by traditional ojek drivers and taxis company, as their income has been negatively affected by online drivers’ subsidised rates.
The growth of GO-JEK challenges the norms of everyday mobility services – threatening and causing unfair price competitions of existing conventional transport providers. GO-JEK’s operations have hence been highly monitored by the local government and the Ministry of Transport (Bidari, 2018).
Similarly, Indonesia’s neighbour Singapore enforced a transport regulatory framework called the P2P Passenger Transport bill allowing the government to regulate ride-hail service fares and impose mandatory licensing requirements for ride-hailing operators (Kit, 2019).
GO-JEK’s Disruptive Innovation Business Model
Every company has a scheme to generate revenue, called a business model – a great one revolutionises their markets and industries, drives growth through customer value proposition (Johnson et. al, n.d., p.58). GO-JEK’s mobile and internet-based business model facilitate the building of a strong network of users; motorbike and car owners, food merchants, various service providers, and their customers.
Their innovative app merges multiple on-demand services into a single app while filling the gap between the high supply of ojek drivers and needs in the market (Kurniawati & Khoririna, 2020). The app is also accessible to all IOS and Android devices.
A noteworthy factor is their user-friendly layout that enables users to easily navigate across different services. A study compared GO-JEK and its main competitor Grab’s interfaces and found that GO-JEK’s app design developed more positive user experiences, with higher visual attractions and customer convenience, efficiency and better perception of benefits (Maharani et. al, 2017). Users can effortlessly select the service they demand while equally receiving customised and engaging advertisements, as well as information relevant to their purchase history, interests and previous location data.
As customers grew accustomed to GO-JEK’s interface, it facilitated the introduction of newly integrated technologies and services within the app seamlessly, like GO-PAY: an e-wallet service, a form of financial technology, embedded on the app. The invention of an incentive scheme called GO-POINTS helped encourage repeated purchases, increased user satisfaction and interactivity (Amirio, 2017).
#CeritaGOJEK – Irfan by GO-JEK Indonesia
Being the first Indonesian start-up company to reach decacorn level allowed GO-JEK to embed a nationalist tone as part of their business model to create a positive brand image and identity. GO-JEK implements storytelling marketing strategies to build brand equity through creation of various social media campaigns such as #CeritaGOJEK (‘story of GO-JEK’), further inspiring narratives on how GO-JEK driver communities have contributed towards social change.
The connection between their technology (app) and its gig workers’ (e.g drivers) participation has not only fostered personal connection but also transformed the interactions within the company, its beneficiaries, and consumers, to a more transparent and collaborative exchange (Utami, 2019).
All in all, GO-JEK has become a part of the Indonesian urban culture, a verb common in everyday conversations like ‘We can just GO-JEK’ or ‘Let’s GO-JEK!’. It is a testament towards GO-JEK’s triumphant innovative business model, developing an ecosystem that integrates various technologies and services that brings value to its users..
How GO-JEK services fit in everyday life:
Its Internet Ecology
Looi (2008) refers to “Internet ecology” as a digitalised learning system where different interacting agents, foster information sharing and creation while developing diverse relationships. GO-JEK’s ecology in the gig economy comprises of its users, suppliers, owners, regulators, partners and competitors.
This is GO-JEK’s internet ecology:
The company’s direct competitor is Malaysia’s Grab, that offers multiple identical services to GO-JEK. Uber is not listed as a competitor as their Southeast Asia operations are sold to Grab in 2018 (Rusell, 2018).
Other indirect competitors that include digital payment gateway company Dana and OVO for GO-PAY, online grocery service Happyfresh for GO-MART and GO-SHOP, national courier company such as JNE, Tiki, Indonesian Post with GO-SEND, and the longstanding public transport services and taxi company, Blue Bird. All indirect competitors offer similar services to GO-JEK, however, only specialises in one of the many on-demand services that GO-JEK provides.
The major suppliers are their driver-partners, consisting of registered motorcycle and cars owners. Other suppliers are their GO-FOOD merchants that sell food and beverages via the app, therefore providing consumers with a wide array of cuisines and sustenance to choose and order from.
In terms of Internet Infrastructure and software suppliers, GO-JEK partnered up with Google Cloud Platform (GCP) to analyse multifarious data rapidly. It utilises the Google Maps Platform to supply better optimisation of routes and time estimation of drivers’ arrival (Google Cloud, n.d.).
Everyday users are consumers, drive-partners, merchants, service providers that rely on the app to generate revenue from the numerous orders for demanded services notified and received through the app. Its regulators are the Transportation and Communications Ministry, and Indonesian Consumers Association.
Additionally, GO-JEK has formed partnerships with various companies like BlueBird and Unilever. Other partners in term of GPS, entertainment, bill payment and national partners that are integrated into the app’s features.
GOJEK – A transformative disruptive innovation with real societal impact
GO-JEK forms new contemporary wants and needs of Indonesian society (Suseno, 2018). Thus, it is evident that GO-JEK is considered what Christensen (1997) theorised as a ‘disruptive innovation’ – companies that make use of new technologies and business models, causing friction to the archaic structures of the market.
Part of GO-JEK’s innovation is expanding its application from primarily ride-hailing, into a ‘Super-app’ – offering more than 20 services today, integrating different technologies, covering niche markets and services online. It serves as a one-stop multiservice platform from transportation-based such as medicine deliveries with GO-MED, to everyday needs like online fuel delivery via GO-PERTAMINA and beauty services (e.g hairstyling, make-up) with GO-GLAM.
Additionally, the app is also embedded with e-wallet technology that can be used to pay electricity bills via GO-BILLS, purchase movie tickets in GO-TIX or to top-up phone credits with GO-PULSA. Thus, GO-JEK challenges its national and international competitors to expand their service provision outside of the typical delivery services.
Another transformation driven by GO-JEK, is their ability to create more social capital by establishing social connections with various organisations. GO-JEK developed partnerships with former competitor, Blue Bird, Indonesia’s largest taxi operator – to collaborate in technology, payment and promotion as well as to mutually contribute to the acceleration of Indonesia’s digital economy. Hence, GO-JEK’s partnership forces its local competitor Grab to reanalyse their current business model to gain more dominance on the streets.
It is clear that GO-JEK is disrupting the transportation scene in Indonesia, however, its influences have expanded outside of just online transport services – it has reached the bus system run by the municipal government of Jakarta. The feature is called “GO-BUSWAY”, an initiative to provide passengers with updated bus schedules, their arrival time and location by equipping the buses with GO-JEK’S technology and GPS infrastructure.
The system offered through the GO-JEK app is quintessential to ensure the safety of commuters. GO-JEK’s support from the government allows them to have political advantages amongst its competitors such as navigating local regulatory laws and receiving endorsements from influential authorities.
Before the ubiquitous presence of GO-JEK, it was unusual to consider an ojek (motorbike taxi) as a formal activity or employment. However, it has become a common job in today’s Indonesian digital street economy, as the rise of GO-JEK and online transport services provide opportunities to earn higher income expenditures – which attracted existing motorbike owners and taxis from all educational backgrounds and ages to register.
Overall GO-JEK’s economic contribution to the economy:
According to the study conducted by the Demographic Board, ojek partners have received higher income opportunities and higher average minimum wage after partnering with GO-JEK. Therefore, not only did GO-JEK’s transformative effect create employment opportunities, it also promoted a shift in general societal perceptions of ojeks They were acknowledged as playing a significant role in everyday tasks of the community: as essential workers.
Ultimately, the company is revolutionary in utilising the digital gig economy, facilitating mobility solutions accessibly whilst creating substantial socio-economic impact. Every user involved with the establishment gain benefits and value: customers can access a network of service providers conveniently, while drive partners, GO-FOOD Merchants and other service providers, are being connected to these customers effectively which increases their reach and income.
Overall, GO-JEK’s disruptions in the online transportation industry have brought various internet transformations. It has formed an innovative business model that revolutionises mobile apps through multiple service provisions, interactive and engaging interfaces while taking advantage of ubiquitous smartphone usage to create a more accessible and convenient ecosystem for all its users.
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