Jakarta has the fourth-longest user time engagement on navigation platform Waze of any city in Asia-Pacific with an average of 81 minutes and an average driving distance of 30 km. Given the city’s notorious traffic conditions, the convenience of GPS technology in mobile map applications has seen it gradually become a part of people’s daily lives. These facts are valuable assets for community-based navigation platform Waze in building its business in Indonesia, where the company is exploring solutions that it can offer to both users and advertisers.
Waze is a mobile navigation app that provides real-time traffic data. Wazers (the term for Waze users) report traffic updates, which will be verified by Waze’s GPS technology. Notifications of issues such as road closures, speed cameras, police checkpoints, and accidents and other hazards will appear on the Waze map for everyone to see. Therefore, allowing Waze to suggest alternative routes so users can save time by avoiding congestion.
Waze was founded by Amir Shinar, Ehud Shabtai, and Uri Levine in 2007, originally in Israel. Google acquired the company in 2013 for $1.3 billion, and since then Waze has been synergizing with Google Maps. Google Maps is built for B2B purposes, mainly for discovery content where all kinds of locations and transportation alternatives are registered. Waze works on a B2C model, learns user behavior and gathers community reports for its navigation platform. Waze’s real-time traffic updates are sourced for Google Maps, and likewise Maps’ landmarks complete the map on Waze.
Currently, Waze has 4.2 million users in Indonesia, growing at 5-10% annually—and organically. They are mostly in big cities in Java and Bali, Sumatra (Medan, Palembang, Lampung), and Sulawesi (Makassar, Manado). Although the app has been available in Indonesia for a few years, it was only in January 2018 that Waze set up a direct representative office in Jakarta, and along with that appointed Marlin Siahaan as the first Waze country manager for Indonesia.
“Since we began our business here in 2018, there are three things that we have paid attention to: users, business, and user behavior,” says Marlin.
The community of users is an asset that reflects the core strength of Waze. Some users are more active and “passionately into maps”, which Waze categorizes as the “editorial community”, and grants them access to edit the map. These are the ones who have opened the routes on Waze since the app first entered Indonesia, and until now update local traffic regulations like the routes for the odd-even license plate regulations, speed camera spots, and toll pricing. In return, Waze empowers the community by inviting the members to annual gatherings on a national scale, and some to regional and global events, so they can share their contribution to Waze in their respective countries.
Owning such data allows Waze to form partnerships with government institutions, where they are facilitated with a cloud system called “Waze Cities for Data” to exchange and update data. Marlin cites Waze Indonesia working with several regional/local governments such as the Jakarta Smart City and Jabar (West Java) Smart City, Dishub (Jakarta Transportation Agency), and TV stations such as Berita Satu and Metro TV.
While the government partnerships come at no cost, Waze’s business comes from advertising on the app. It is called a “mobility marketing solution”, which provides online-to-offline (O2O) solutions—learning user behavior online for a better approach and driving them to the location.
The most famous type of ad is the “branded pin”, which Marlin says is similar to a store’s signage, and will be visible on the map in the form of an advertiser’s logo. The main purpose is to make users aware of the business’ location. Marlin says that this is the kind of “micro moment” that Waze is trying to offer to both users and advertisers. While on Waze’s official website one branded pin costs $2, Marlin says that in Indonesia it offers a cheaper price of $1.
“We’re kind of different compared with other digital platforms, and we name our advertising platform Digital OOH, or the digital billboard. When you are driving, you see advertisements on a billboard or hear them on the radio, and now you can find them while you’re using Waze.”
Waze categorizes its business partners into two; Key Accounts, which are big brands with many outlets and targeting the general public; and small and medium businesses (SMBs), which usually aim for people only in their surrounding area. Waze has a local team to directly communicate with Key Accounts, while SMBs are still handled by the global team. SMBs can also purchase Waze ad slots online with a credit card, and they will be given access to a cloud system dashboard to manage their campaign results and spending.
“Since we are still focusing on Key Accounts, they make up the majority of our partners […] But looking at the trend in Indonesia, I see that SMBs are another potential. Our team at Google has begun to approach SMB partners through the Gapura Digital program, where we teach them about building a more impactful business […] For example, they can use Google My Business to list their business locations on Google Maps, and advertise them on Waze.”
When Waze Indonesia began to promote its advertising business last year, it only focused on three sectors: quick service restaurants (QSRs) like McDonald’s and Pizza Hut, fuel companies like Pertamina and Shell, and automotive businesses like Toyota. However, starting this year more industries have shown significant interest, such as fast-moving consumer goods (FMCGs) like Unilever and Nestlé, which has grown almost 2.5 times larger compared to the aforementioned sectors. There are also banking and finance companies such as Mandiri, BCA and BNI, since they have numerous outlets across the country.
Although Marlin declined to reveal Waze’s growth target for Indonesia next year, she says that Waze will focus on the number of partners that it plans to approach instead of the total revenue. She aims to have three to five advertisers from the retail industry—fashion retailers such as H&M, Matahari, and Zara, opticians, supermarkets and minimarkets, and property.
Waze is planning to launch a new advertising platform “Buy Online Pickup in Store (BOPIS)”. By clicking the advertiser’s banner on Waze, users will be directed to the advertiser’s app, allowing them to order and pay. The feature is already available in the US, and will run for trial in Asia-Pacific soon. She also hinted at possible plans for Waze Carpool to operate in Indonesia, or at least in Asia Pacific, without elaborating.
“What we truly focus on is building our business here and maintaining the community, because once we set it on the right direction, we can proceed to our next strategy. Right now we are trying to build our users’ behavior in using Waze—checking the map every day—as well as making our partners aware of Waze’s business solutions in advertising. That’s why since the beginning of our establishment here, we have yet to focus on expanding our user base as it’s not Google’s way.”