Grab customer experience savaged as report identifies ‘stunning pace’ of fall from ‘local hero’ status

Research firm Forrester has delivered a withering critique of Grab’s controversial Singapore deal with Uber and warned other digital monopolies to learn from the failings of the ride hailing firm.

Grab has already fallen foul of the competition regulator after it, and Uber, were each fined S$6.5m following an investigation into the transaction.

The probe by the Competition and Consumer Commission Singapore concluded that the sale of Uber’s South East Asia business to Grab in exchange for a 27.5% stake in its rival adversely effected consumers and drivers.

While the CCCS hit Grab in the pocket, the Forrester analysis on the importance of the customer experience was a more savage assessment.

The report said that as promotions were reduced, and fares increased in the aftermath of the Uber deal – which has been denied by Grab – the perception of Grab “started to shift from that of a scrappy local startup focused on customers to a dominant market leader focused on the bottom line”.

Critically, Grab failed to understand the “powerlessness” felt by customers and drivers, who felt “suppressed and forgotten”, Forrester said.

“Grab triggered an explosive emotional reaction that undermined its market position and spread like a virus,” the report said. “Human beings are analogue and still driven by emotions. Understanding customers emotional triggers allows digital businesses to boost success and sidestep dangerous pitfalls.”

Brands should also take heed of Grab’s timing when it allowed a price change to “go through” soon after the merger, while alterations to its rewards programme were introduced “almost overnight”.

While “unpleasant messages” are sometimes unavoidable, brands can control how and when they are delivered to customers, Forrester said.

Grab, it found, “unnecessarily stoked customer complaints”, alienated loyal customers and “caused considerable damage”.

“Backing off of or temporarily reversing those changes would have earned customers’ goodwill,” it said.

The authors of the report, Tom Mouhsian and Dane Anderson, stressed that “good intentions and reassuring words” must be backed up by actions. They described Grab CEO Anthony Tan as a “young, inspirational Malaysian leader” who has demonstrated a “genuine desire that customers come first”.

Anthony Tan: Genuine

“However, Grab’s CX performance since the Uber merger  showed that even the best intentions are not enough,” the report said. “Sustainable success requires a comprehensive operational reboot and strong CX management.”

Forrester, which interviewed drivers and customers for the report, said firms must build a “customer-obsessed” operating model and earn the trust of the public.

It added that diversifying into other business areas, such as Grab with GrabPay and GrabFood, was “not a right, but a privilege requiring customer permission built with strong CX, delivered consistently over time.”

“Customer trust is precarious and earned daily,” it said. “Organisations earn it or burn out.”

In its conclusion, Mouhsian and Anderson, said Grab’s experience “showcases the importance of customer experiences to all companies, including high-flying digital disruptors”.

“The stunning pace with which Grab fell from its unquestioned position as a local digital hero should remind all eBusiness leaders that their customers are in charge,” it said.

“Organizations must learn to reliably and consistently deliver the right CX at the right time.”

Strategic foundations that ignore the importance of a customer-obsessed model that delivers strong CX “will eventually collapse,” the report said.

“If Grab doesn’t adjust course and execute, it will learn the power of customer obsession and CX the hard way.”

Responding to the criticism, the head of Grab Singapore Lim Kell told Mumbrella: “We acknowledge there’s a lot more we can do and we are making every effort to improve our services and customer experience. We will work harder to rebuild our relationship with users in South East Asia.”.


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