How Grab can benefit from rebound in SEA tourism

As Southeast Asian countries reopen their borders in the post-pandemic era, Grab is positioning itself to benefit from the surge in inbound tourism.

The move puts the regional super app in the ranks of Klook, AirAsia, and Alipay+, which collectively operate a patchwork of services that facilitate travel bookings, local experiences, and cross-border digital payments.

At a press event last week, Grab announced that its app is now available in three languages – Chinese, Korean, and Japanese – and unveiled a slew of new travel features.

The firm estimates that on average, tourists spend twice what locals do on transport per day, making them a high-value segment.

“Post-pandemic, travelers are increasingly desiring food delivery. They’re much more comfortable with food delivery while on holiday,” Russell Cohen, group managing director for operations at Grab, said at the event.

Using Bali as an example, he shared that travelers to the Indonesian holiday island contributed 15% to the super app’s food delivery sales volume in March, going up from 10% in December 2022.

A holiday home in Bali, Indonesia / Photo credit: Catriona Ward

As such, Grab is poised to benefit from its status as Southeast Asia’s dominant platform for ride hailing and food delivery, as well as from its investments in mapping and other areas.

The company’s range of services, which include transport, ecommerce, food delivery, and digital payments, is available in eight countries across the region. They will come in handy for the many international tourists who tend to visit more than one country when holidaying in Southeast Asia.

Travelers need to download just one app, giving Grab an advantage over players that offer only one service.

Tourist numbers yet to reach 2019 highs

Tourism accounts for around US$393 billion of Southeast Asia’s gross domestic product (GDP) and employs 16 million people in the region.

Visitor arrivals plummeted during the pandemic, and while numbers have recovered from the lows of 2020, they have yet to scale pre-pandemic heights.

Case in point: Thailand, the region’s most popular tourist destination, expects to welcome over 30 million visitors this year, but that’s still 25% off its 2019 high.

One of the missing elements? Chinese tourists. In 2019, 11 million of them visited the kingdom, while only 7 to 8 million are expected to visit this year. This has already been revised upwards from 5 million.

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