Koppiku stirs up coffee market

Rajiv: At the end of the day, you don’t want to be chasing store openings if you can’t get your service level right or maintain product consistency.

IN the last few years, Malaysia’s coffee sector has been abuzz with activity. Competition has increasingly brewed, with established homegrown and international players racing to expand their share of a growing coffee-drinking market.

Yet that didn’t stop local coffee chain Koppiku from throwing its hat in the ring in 2023.

“I did ask myself, ‘Is there still room for another new coffee brand?’,” admits Rajiv Bhanot, Koppiku’s CEO and founder.

“It was deemed a very saturated space, so I was keen from day one to build something beyond just a beverage brand. I wanted to grow a household name that would stir up a sense of national pride and empower Malaysians from different walks of life,” he tells StarBiz 7.

The idea for the business came to the doctor-turned-entrepreneur after observing the exponential growth of the coffee landscape locally and in South-East Asia, as well as the shift of consumer tastes towards localised coffee offerings.

With a focus on affordability, accessibility and aspirational branding, Koppiku brings a range of locally inspired beverages that blends nostalgic flavours with innovation.

“Our R&D (research and development) team worked relentlessly to capture the local essence by playing with familiar ingredients that many of us Malaysians grew up with,” he shares.

For example, the menu features lattes with gula melaka, “Bandung Latte” with rose syrup, and “Cereal Latte” with a multigrain cereal topping.

With beverage prices that sit between RM4 and RM10, Koppiku seeks to tap into a segment of cost-conscious coffee consumers looking for trendy yet budget-friendly beverage options. Its pricing strategy reflects a core focus of the business: putting premium coffee within the reach of a wider set of Malaysians.

According to Rajiv, significant time and effort is devoted to refining processes at a store-level so that its outlets are able to sustainably maintain its high affordability without compromising on quality.

“Having a prudent and disciplined approach to our operations is one aspect that has allowed us to build this business while maintaining the price points we have,” he notes.

As a young business, listening to consumer feedback has been critical to Koppiku’s evolution and success. In April, the brand launched its own mobile app, enabling enhanced customer engagement and retention through promotions and loyalty programmes while providing detailed data on their preferences.

Such information has been key to pinning down the company’s target consumer demographics.

“The data from the past 22 months since opening has given us more clarity in the direction we want to take this brand,” he adds.

There’s also considerable emphasis on creating awareness for the brand through consumer-led content and social media virality, says Rajiv.

For this reason, considerable research and discussion went into the presentation and aesthetic appeal of the brand, from its eye-catching airstream outlets to its signature calming green corporate colour.

“A RM5 coffee at a kopitiam doesn’t have the aspirational value that a visually interesting, ‘Instagrammable’ beverage does. Having this element helps us get the brand out there in a very organic manner,” he explains.

Koppiku’s vibrant, media-savvy essence is further fuelled by its young, 400-strong team of store employees.

“For 95% of our baristas, this is the first job they’ve had. Being able to empower hundreds of Malaysians by giving them financial independence, training, and a career pathway within the organisation is also something that contributes to this aspirational part of the brand,” he says.

The CEO further stresses the importance of building a strong company culture in any business, which comes directly from the top-down.

“It’s remarkable to see how the culture at the HQ level is passed down to the baristas at the stores, which then gets extended to the beverages they produce, which are then enjoyed by the consumer,” he says.

Currently, Koppiku has 50 stores, of which 46 are in the Klang Valley. The company recently opened four outlets in Kuantan, and aims to continue expanding its presence across other cities in Malaysia.

However, Rajiv says he is not fixated on aggressive outlet expansion. At the moment, the focus is on choosing strategic locations with high footfall to forge stronger brand affinity with consumers.

“We want to keep building, but only with a manageable cadence of growth,” he notes. “At the end of the day, you don’t want to be chasing store openings if you can’t get your barista service level right or maintain product consistency for your customers.”

For him, it is crucial at this stage to continually adapt and improve the business’ playbook. Each phase, from brand ideation and conception, to building the first 10 stores, to reaching the 50-outlet mark, comes with its own set of unique challenges.

“The first bottleneck when we started involved finding locations and convincing landlords that we could bring them value. After that, it became about growing our stores and difficulties in hiring and training manpower,” he says.

Later on, the launch of the mobile app meant solving a range of tech-related issues. Now, the team is seeking more avenues to establish brand awareness, such as crafting culturally resonant events and collaborations.

“I love the startup environment, because you’re firefighting on a daily basis, and the problems you face keep evolving. To me, this is a good indication that, rather than staying stagnant with the same issue, the organisation is growing and moving in the right direction.”