CHAPTER I INTRODUCTION

1.1 Research Object Overview

1.1.1 Waze Overview

Waze is a navigation and community-based traffic app, which is designed for drivers first and foremost. Waze was designed to navigate driver to the desired destination by wealth of user reported data. Waze was born in 2008 and who has more than 250 products and owned popular platform such as Youtube and has bought Waze in 2013.

Figure 1.1 Waze Logo Source: www.waze.com The app was first developed and popularized by Waze Mobile, an Israeli company founded by Ehud Shabtai, Amir Shinar and Uri Levine, funded by two Israeli venture capital firms, Magma and Vertex, and an early-stage American venture capital firm Bluerun Ventures before it was owned by Google. Now Waze is the app used by drivers all around the world and provide 50 languages which can be customized based on the country the user living in.

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Figure 1.2 Waze User Interface Source: Author There are several facilities the users can get in Waze, including: a. Live traffic reporting alert by users b. A plethora of voice navigation options, including celebrity voice c. Remembers commonly used routes, frequent destinations, and commute times d. Re-routing aggressively to save time e. Not only for cars, Waze is also has a motorcycle mode f. Traffic jam countdown g. Cop notifications h. integration so the users can drive while listen to music at the same time i. Provide planned drive for the future event j. Spots parking spots, gas stations, restaurants or even coffee shops k. The user can talk to Waze instead of typing l. Speed warning m. Minimize the time in traffic by finding the fastest road possible

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1.1.2 Vision and Mission

Vision To get the millions of drivers out on the roads to work together towards a common goal; outsmarting traffic and getting everyone the best route to work and back, every day. Mission To help people create local driving communities that work together to improve the quality of everyone's daily driving.

1.2 Research Background

Indonesia is the fourth largerst country in the world after China, India and United States. According to Spectaor Index, Indonesia has over 256 million people living all across the region. Indonesia is predicted reaching its peak in 2062 with 324,76 million people. (Databoks, 2018) According to factsofindonesia.com, with a population growth rate of 3 million per year, Indonesia has been successfully become the overpopulated country. Over population have both postive and negative effect. For the bright side, Indonesia has a large number of human reources and labors, grow a competitive spirit for entrepreneurship and can become the market for potentially productive result. But, for the dark side Indonesia has a quite cornerning amount of employment which is 6,87 million people, high level of poverty and also a very bad mobility problem. One of the simple example of mobility problem is a traffic congestion. According to brookings.edu, rising traffic congestion is an inescapable condition in large and growing metropolitan areas across the world. That statement in fact is currently happening in Indonesia’s metropolitan cities. Jakarta for example, right now the capital city of Indonesia is on the 12th position in The 100 Most Congested Cities in the World. Jakarta citizens has to spent the average of 63 hours on the road per year, not only jakarta, another cities such as Bandung with the average of 46 hours per year, Malang at the 85th position with the average of 46 hours on the road per year, followed by Yogyakarta witch increased its

3 position from the 86th to 60th , also Padang with the average of 45 hours spent on the road and lastly Pontianak whith its 93rd position are all in the set of the lists. (DetikOto, 2018)

Table 1.1 Top 3 Countries With The Most Congested Traffic In The World Rank Country Average Peak Hours Spent in Congestion 1 Thailand 56 2 Indonesia 51 3 Colombia 49

Source: The chart was made by the author based on the INRIX Reasearch 2017 For the overall score, Indonesia as a whole was ranked 2nd after Thailand with the average of 51 hours spent on the road. This is a sign traffic congestion has become a big concern in Indonesia, the inhabitants of Indonesia need a tool to facilitate space and mobilization to move places in long distance or close range. Based on the survey result done by Asosiasi Penyelenggara Jasa Internet Indonesia (APJII) 2017, The internet users peneteration in Indonesia is 143,26 Million people from the total population of 262 Million people, this means the internet users in Indonesia is more than a half of the population existed, which is 54,68%.

Figure 1.3 Indonesia Internet Users Penetration in 2017

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Source: APJII Survey Result 2017, available on: http://apjii.or.id/survei There are several devices the users can use to access the internet but based on the data collected by APJII the internet users in Indonesia is dominated by /Personal Tablet users, which is 44,16% out of 100%. With a high of smartphone/Personal Tablet users in Indonesia, it directly affect the growth of application downloads. Today's applications are available in various platforms from messaging, social, gaming, online transportation as well as navigation applications. The emergency of downloading traffic and navigation applications began because of the increasingly progressive building of roads and congestion as the author mentioned earlier. One of the most popular navigation applications downloaded in Indonesia is Waze. In fact when Waze was claimed by Google in 2013, the application has grown rapidly ever since. According to Tribuntechno, Waze is in the 2nd position as the most downloaded navigation application in Indonesia which is 5,6% downloads. Table 1.2 Download Percentage Of Popular Navigation Apps Navigation Application Download Percentage Name 65% Waze 5,6% 1,4% ROUTER 66 Navigation 1% GPS Navigation and Map 0,5%

Source: The chart was made by the author based on Tribuntechno Article 2016 According to Senior Director of Communication of Waze, Julie Mosler, Waze began in 2008, when a man was frustated about the GPS he had. He though a traditional GPS could be imporved by tracking local driver’s speed and allowing them to add incidents like car accidents or traffic jams.

5 Waze is the biggest community-based traffic and navigation app. It can contribute to provide traffic information and accidents that occur on the road. The users can use Waze anywhere, anytime at any occasions. Compared to other navigating apps, Waze is a driving focused navigation so it fits for those who has a vehicle or a passanger of the vehicle to use Waze for the easier mobility. Waze offers some cool features. The users can edit or add the latest road maps and routes to be more accurate and shorten mileage, the users can rely on wealth of user-reported data by other users, spot road hazards, gas stations, restaurants and also adjusting its recommendations in real time so the users can get the fastest way possible to get to the destination and avoid traffic. It recommends user to go to alternative roads so user can save the time and it is updated every seconds depend on the current situation the road is at the moment. Globally, Waze now has over 100 Million active users from 185 countries across the globe. In Indonesia, the growth of Waze is quite significant form year to year, it reached over 750.000 active users back in 2013, and in 2015 the number had increased consistently until it reached over 1.5 Million active users and now Waze in 2018 has reached over 4 million active users who use the application at least twice a day. (Marlin, 2018) On average, Navigation apps do not you as much data especially when they are really useful. But compared to other popular navigation app, which is Google Maps, Waze seems to be the best in terms of data usage. According to Country Manager Waze Indonesia, the average usage of Waze is around one hour twenty minutes until one hour thirty minutes, meanwhile the average of any other app is only at fifty minutes maximum per use. This is pointing at the fact the users are using Waze for a long trip and need Waze as the guide. The motive of why the user is using Waze because it can save the time on the road, it is relevant to their slogan which is, “save your time five minutes a day”.

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1.2 1 0.8 0.6 Google Maps 0.4 Waze 0.2 0 Per 20 minutes Per 10 miles

Figure 1.4 Data Usage Popular Navigation App

Source: the figure was made by the author from WhistleOut (2018) According to Marlin, Waze is the navigation platform where the users already know where they are going, basically, the users want to avoid the mad traffic in the area so Waze has become the solution for the users to find the more convienience road trip from traffic. The ulitization of Waze really fits for crowded cities, such as Jakarta, Bandung and Bali. Moreover, Jakarta is on the list of 10 cities targeted to be the smart cities. (Paige, 2014). Fully aware of the benefit of Waze, Principal Governance of DKI Jakarta has coorperate with Waze since 2014, and it is not limited by the time, so Principal Governance of DKI Jakarta will always open about the idea Waze has to offer in the future. Waze helps to anticipate chronic Captital City’s congestion, by integrating traffic data sourced directly from Provincial Government of DKI Jakarta about the traffic conditions, traffic accitdents, and Government activities. Provincial Government of DKI Jakarta claimed even though TMC Polda Metro Jaya has its own mobile application, but It has not fully reach the standard of the users need about the data and the function is still very minimal so the use of Waze is very helpful, it’s free and actual. (DailySocialid, 2014) does not stop there, here are the list of some projects Waze has to maximize its function in Indonesia: 1) Waze partners with the Smart City of Jakarta 2) Waze partners with Principal Governance of DKI Jakarta to build Intellegent Traffic System (ITS)

7 3) Waze parnets with Asian Games 2018 and recruiting Dian Sastro as the voiceover during the event 4) Waze applicationlies the odd-even rule for Jakarta’s users 5) Waze partners with PT. Pertamina (Persero) to notice the users if the gas station provides the ‘premium’ type of fuel oil or not. This will applies especially in Jawa, Madura, dan Bali 6) Waze parnets with several broadcasters such as Television Brodcaster In 2014, Indonesian Waze users has become the top 10 biggest Waze users in the World (DailySocialid, 2014) in 2017, Jakarta holds the title as the 2nd biggest Waze users in ASEAN after Kuala Lumpur, according to Moda Weng, Waze Global Strategic Partnetship Manager of Waze, the huge growth of Waze Users is because the problem of traffic congestion in Jakarta (liputan6.com, 2017). Waze has 50 communities that are actively volunteering and once a year Waze organizes community gatherings for these communities and Waze targets 4,1 Million users in Indonesia this year, and now is focused on continuing to add the user downloader. So, the business target is the user and the business can grow. (Tempo.co, 2018) This year Waze focused on quick service restaurants (QSR), automotive and fuel. Waze is also planned to be penetrated in other industries such as banking or FMCG (fast moving consumer goods) because according to Marlin, people must take a drink in the car, so FMCG has the potential to be approached and also banks have many branches, ATMs, and e-money for used on the toll road. Those are the plans Waze will excecute to hold their current position and expand the business in Indonesia. Regarding the explanation above on how well the reception and adaptation of Waze as the community-based Traffic and Navigation app in Indonesia, the author would like to do research title “UNDERSTANDING THE FACTORS INFLUENCING CONTINUANCE INTENTION OF TECHNOLOGY ADOPTION ON COMMUNITY-BASED TRAFFIC AND NAVIGATION APP USERS IN INDONESIA USING MODIFIED UTAUT 2 (ON WAZE APPLICATION)” the author choose Waze as the object of this research because Waze is one of the most used and also the 2nd most downloaded navigation

8 application in Indonesia, Waze is also on the list of top 10 biggest users in the world. The author also has the curiousity to analyze the Continuence Intention of Waze application users in Indonesia since the fast growth of Waze application in Indonesia. Also, Waze application has never become the object and analyzed before in Indonesia by using UTAUT2 method, so the author hope this research will fill the blank by conducting the research regarding Community-based Traffic and Navigation Application.

1.3 Problem Statement

Indonesia has such a bad congestion because of the overpopulation factor influencing it. The growth of huge population also affecting the increasing number of internet users in Indonesia, and nowadays people tends to use internet to make their life easier on every errands, no exception for the mobility problem. For solving the mobility problem, people use navigation app which can be downloaded directly on their phone. Waze is one of the most popular navigation application in Indonesia. The successful growth of Waze is proven by the fact that Waze is the 2nd most downloaded navigation application in Indonesia, on the list of top 10 biggest users in the world and Indonesia also holds the title as the 2nd biggest Waze users (Jakarta) in ASEAN. Waze has made its greatest move to cooperate with gorvenment and big companies in Indonesia to solve bad congestion in the cities all over Indonesia. For instance, Waze coorperated with Principal Governance of DKI Jakarta since 2014 until now, Waze partners with the Smart City of Jakarta and also partners with PT. Pertamina Persero. Those projects proven the adoption of Waze is really welcomed in Indonesia. In 2018, waze users’ in Indonesia has reached over 4 million active users that use the application at least twice a day. Until today, Waze continues to help the users to solve it right away with the facility that is given inside the app. By the successful growth of Waze in Indonesia, there has to be several factors influencing it. But even though Waze application has been downloaded and used by many, there is none of a study that anaylze the factors incfluencing users to use Waze application continuously for the traffic congestion solution in Indonesia. Therefore, Waze needs to realize there are factors that can influence

9 the continuance usage of Waze application itself, so it is necessary for the author to identify the variables that are taken into the consideration as the factors influencing the continuance intention in adopting Waze in Indonesia.

1.4 Research Questions

To make the research clear and directed, also to find the right variables which encourages the users to continuously use Waze, the author did a literalure review from the previous studies and find out the most fitted theory for this research is using UTAUT2, but there is a variable that has not been included in the UTAUT2 model, which is ‘Content’. Thus, the model used in this research is Modified UTAUT2 with the additional ‘Content’ as the new variable, adapt and modified Berhavioral Intention to Continuance Intention and Experience is eliminated as the moderate variable because this research is a cross sectional study. So, the research questions are formulated as follows: 1. Based on the modified UTAUT2 model (Performance Expectancy, Effort Expectancy, Social Influence, Facilitating Conditions, Hedonic Motivation, Price Value, Habit and Content) how much is the tendency of consumer's assessment to continuously using Waze application in Indonesia? 2. How strong is the continuance intention of consumers towards Waze application in Indonesia? 3. Based on modified UTAUT2 model, what are the factors influencing consumers’ continuance intention in the context of Waze application in Indonesia? 4. Do age and gender have an impact on the factors of modified UTAUT2 model which influence Waze application users on continously using Waze application in Indonesia? 5. Can this research model of modified UTAUT2 be used for predicting the continuance intention of Waze application in Indonesia?

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1.5 Research Objectives

In line with the research questions above, the objectives of the research are: 1. To analyze how much is the tendency of consumer's assessment to continuously using Waze application in Indonesia (Performance Expectancy, Effort Expectancy, Social Influence, Facilitating Conditions, Hedonic Motivation, Price Value, Habit and Content). 2. To analyze how strong is the continuance intention of consumers towards Waze application in Indonesia. 3. To test the factors influencing continuance intention on using Waze application in Indonesia based on the modified UTAUT2 model. 4. To test if age and gender have an impact on the factors of modified UTAUT2 model which influence Waze application users on continously using Waze in Indonesia. 5. To test wether this research model of modified UTAUT2 be used for predicting the continuance intention of Waze application in Indonesia.

1.6 Significant of the Study

1.6.1 Academic Aspect

The result of this research is expected to be able to contribute to increase the understanding of the continuance intention of technology adoption on Waze users in Indonesia. This study is using modified UTAUT2 model by adding the variable Content and does not include variable Experience as the moderating variable to predict Continuance Intention for ‘Waze’ as the object. Waze as an object in general, has not been used in the previous UTAUT2 research. So the author hope the result of this research can fill the gap in the presence of literature related to continuance intention of Waze adoption in Indonesia by using modified UTAUT2 model.

1.6.2 Business Aspect

The result of this research will be helpful for the navigation applications especially for Google and Waze to know user’s perspective about Waze. Also, to

11 give recommendations to Waze on what is needed to be improved about the application in order to expand the business and develop the business strategy by understanding the factors influencing the continuance intention of Waze application users. For the companies who run similar applications, the result of this research hopefully can be the guidance to fix deficiencies and improve the marketing strategy for their product.

1.7 Research Scope

1.7.1 Location and Object of Study

The location of the study is in Indonesia and the cities selected are Jakarta, Bandung, Malang, Yogyakarta, Padang and Pontianak, which are on the list of The 100 Most Congested Cities in the World. The object of the study is Waze users and this research is using purpose sampling method so the users have to alteast use Waze for three months and in the age between 15-60 years old.

1.7.2 Time and Period

The period of this study started from September 2018 until December 2018.

1.8 Systematic of Writing

Systematic of writing in this study are divided into five chapters as follows: CHAPTER I INTRODUCTION: This chapter is describing the review of the research object, research background, problem statement, research objective, and scope of research. CHAPTER II LITERATURE REVIEW: This chapter contains a description of literature review, theories related to research and solution of the problem, theoretical framework and scope of the study. CHAPTER III RESEARCH METHODOLOGY: This chapter contains the type of research used, the operationalization of variables and measurement scales, phases of the research, population and sample, data collection validity, and reliability test, and data analysis techniques. CHAPTER IV RESULT AND DISCUSSION: The Research Result and Data Analysis This chapter describes the characteristic respondent, result of research

12 and discussion about the result of research itself. CHAPTER V CONCLUSION AND SUGGESTION: This last part of chapter contains conclusion, limitation of the study and suggestions for future researchers.

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