Should Gojek prioritize expanding to new cities or deepening services in existing markets?

Introduction

The trade-off we're examining today is whether Gojek should prioritize expanding to new cities or deepening services in existing markets. This decision is crucial for Gojek's growth strategy and resource allocation. I'll analyze this trade-off by considering market dynamics, user needs, and business objectives.

Step 1

Clarifying Questions (3 minutes)

• What's Gojek's current market share in existing cities?

• Why it matters: Understanding market penetration helps assess growth potential.
• Hypothetical answer: 30% market share in major cities.
• Impact: High market share might favor deepening services; low share could suggest expansion.

• What's the competitive landscape in potential new cities?

• Why it matters: Informs the difficulty and cost of entering new markets.
• Hypothetical answer: Strong local competitors in most potential new cities.
• Impact: High competition might favor focusing on existing markets.

• How saturated are current service offerings in existing markets?

• Why it matters: Indicates potential for service expansion vs. market expansion.
• Hypothetical answer: Core services well-established, but room for new offerings.
• Impact: Unsaturated markets might favor deepening services.

• What's the projected growth rate of existing markets vs. potential new markets?

• Why it matters: Helps compare growth opportunities.
• Hypothetical answer: Existing markets growing at 15%, new markets at 25%.
• Impact: Higher growth in new markets might favor expansion.

• What's our current customer acquisition cost (CAC) in existing vs. potential new markets?

• Why it matters: Indicates efficiency of growth in different scenarios.
• Hypothetical answer: CAC 30% higher in new markets.
• Impact: Lower CAC in existing markets might favor deepening services.