Check out this customer’s experience of trying GrabTaxi for the first time in 2014

Before there was Grab, there was GrabTaxi. Here’s an account of a customer’s experience when the ride-hailing app was freshly launched in Singapore.

Hawyee is a research associate at the Lee Kuan Yew School of Public Policy in Singapore. Opinions expressed here are his own.

Friday was the first time I used the taxi booking app GrabTaxi to book a cab. I had a lunch appointment to go to and it had just started raining. None of the official apps from the taxi companies – Comfort, Trans-Cab, and SMRT – were successful in getting me a cab. The third try with GrabTaxi was successful. The cab arrived in a minute. On the way to lunch, I asked the driver about his experience with GrabTaxi and here’s what I found out.

GrabTaxi has a rapidly growing number of cab drivers using its app

Comfort, Singapore’s largest taxi company, has around 16,600 cabs plying the road. GrabTaxi has 10,000 registered drivers now in the country, making it the second largest ‘taxi operator’; and it’s rapidly signing up more drivers.

The way GrabTaxi broke into the Singapore market was by solving a demand and supply problem. When it launched, it absorbed the booking fee for commuters — the best it could do since it didn’t have a mechanism to pay commuters. On top of the normal booking charges, the company paid drivers a bonus of about $6 for each booking accepted. This in effect quadrupled the drivers’ cut from a normal booking. These two strategies allowed it to build up a large supply of both commuters and drivers from early on.

The driver I spoke to now takes more than 10 jobs a day from GrabTaxi, but only two from Comfort. The number of bookings now available through GrabTaxi is now so good that some taxi drivers are buying new phones just to be able to take GrabTaxi bookings (since the driver app is only available for Android phones currently).

GrabTaxi in Singapore easily completes more than 200,000 bookings a week now with its present fleet of drivers. It is arranging regular meetings with LTA to show the authorities that it has a higher rate of success in matching drivers to commuters than the current fleet operators.

GrabTaxi is more commuter- and driver-friendly

GrabTaxi’s app is fast. Because it is constantly updated on the locations of its drivers, it knows exactly which drivers to tender a booking to. All drivers within a certain radius of a booking is given a chance to bid. A notification pops up on each driver’s phone, and if many drivers bid for a job, the conflict is immediately resolved by Grab Taxi’s servers and the successful driver is notified immediately, and so is the commuter.

When a booking is made by a commuter, the phone shows in real-time a list of cabs being offered the job. Once a match is made, the commuter’s and the driver’s phone numbers are immediately made available to each other so that they can communicate about any unexpected issues. Dialing can be done from within the app.

Because drivers and commuters are likely to be using 3G devices, the response times are much faster than those from the operator’s terminals, which are on the much slower GPRS. This eliminates annoyances such as many drivers turning up for the same job or commuters getting on another cab because they think their booking was not successful.

For the commuter, using GrabTaxi eliminates the hassle of trying to book cabs using three or four different apps when he’s in a hurry for a taxi. Moreover, the real time feedback that a booking is unsuccessful means that the commuter can immediately try the booking again. Unlike Comfort’s app, Grab Taxi does not ask the commuter to “try again in ten minutes” (probably because Comfort’s servers are overloaded, or they do not want unsuccessful bookings to mar a KPI which LTA monitors).

GrabTaxi has changed the power dynamics between drivers and the cab companies

GrabTaxi operates a high-margin business

Comfort has to compete or die