JAKARTA -- Go-Jek, a smartphone app that hails motorcycle taxis, or "ojeks," as they are known here, has been a sensation in Indonesia's capital since its launch in January. It has become so popular that traditional taxi companies are gearing up for increased competition from the app. Go-Jek Indonesia CEO Nadiem Makarim recently spoke with the Nikkei Asian Review about his plans to expand into e-commerce as well.
Q: How did you come up with the idea for Go-Jek?
A: I founded the idea of Go-Jek based on my own personal needs living in Jakarta. I realized that time was the most precious commodity for living in this traffic-stricken city. So I took ojeks everywhere.
But ojeks were a highly undervalued asset. This was because of huge market inefficiency, whereby they could do so much more during the time that they are willing to work. But there wasn't a level of trust, and there was no supporting technology. So we created a mobile application that connected the drivers to customers.
Q: What has been the response to the new service?
A: We have grown from 1,000 drivers (in January, when the app was launched)
to 10,000 now. We have expanded to four cities. We really did not expect the market to respond the way it did. Smartphone penetration was high, traffic was getting worse and people wanted on-demand everything, so I think we got lucky and our team executed very well.
A: My focus is in Indonesia. I want to show how this model can become an innovation in how we do logistics and e-commerce in the future. I think the shopping function in Go-Jek is especially a game changer, because it creates e-commerce potential without any inventory risk, and without any delivery cost, which is paid by the customer.
Q: What are your expansion plans?
Everyone is thinking about going online, but with Go-Jek, we take you online without you even knowing. In Go-Food (a food delivery service using Go-Jek drivers), we listed 15,000 restaurants. Overnight, we moved the Indonesian food industry online. It was simply because we had a huge fleet that was able to buy food from any restaurant. We're going to do the same with groceries and supermarkets.
Q: Is competition heating up?
A: We are hyper local, so we're not really worried about foreign competitors coming in. Ultimately, in this kind of sector, it is not only money that counts. Your execution ability actually matters more. And that is where our team has a distinct advantage. We have a huge passion for Indonesia.
Interviewed by Nikkei staff writer Wataru Suzuki