Oriental Kopi drops CNY service charge hike following backlash

Malaysian coffee chain Oriental Kopi has apologised for its plan to hike its service charge during the upcoming Chinese New Year. In a statement on Facebook, the company said it is sorry for the troubles caused.

It added that its service fee will remain unchanged and that no adjustments will be made during the Chinese New Year period. Oriental Kopi stated that it is committed to providing its customers with the best. 

The price hike was first announced on 20 January and saw that its service charge would increase from 10% to 15%, excluding the 6% sales and service tax. Member of parliament Jimmy Puah posted a photo of the notice on Facebook, asking if it was reasonable and legal under the law, and if it will set a precedence for price hikes during every festive season. 

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The coffee brand quickly received backlash from netizens, with sentiments being 98% negative and 2% positive, according to media intelligence firm DATAXET Nama. Most comments criticised Oriental Kopi’s service charge hike, linking it to IPO-linked financial tactics (30%), overhyped food quality (22%), and perceived marketing manipulation (12%).

Some netizens have called for a boycott of the company (17%), while a small 12% of netizens showed concerns regarding employee welfare and questioned whether staff, particularly foreign workers, received fair wages from service charges. 

A small minority defended the hike as justified for holiday labour costs (2%) or praised the retraction.

In tandem, the brand's word cloud reflected public concern over pricing, service charges, and consumer sentiment towards Oriental Kopi. Key terms such as “customers,” “rakyat,” “price,” “service,” and “charge” highlighted frustrations over affordability, particularly during Chinese New Year.

The mention of “boycott” suggested calls for action from dissatisfied customers, said DATXET Nama. At the same time, “pay” referred not just to rising costs but also to debates over foreign worker wages—whether they received double pay on public holidays—and the fairness of service tax charges.

Meanwhile, “premium” stemmed from Oriental Kopi’s 71% stock price surge on its ACE Market debut, fuelling perceptions of arrogance and justifying premium pricing and service tax hikes. The discussion underscored growing scrutiny over business practices, profit motives, and fairness in pricing, reinforcing the need for clearer communication and consumer trust-building, added DATAXET Nama. 

Following Oriental Kopi's statement, MP Puah put out a statement commending Oriental Kopi for doing the "right thing" by reverting their decision to retain their service charges to 10% instead of increasing it to 15% during the festive season. "If the decision to increase the service charges during festive season has gone through, it could have set a dangerous precedent, enabling restaurants to use similar justifications to increase service charges during every festive season. Undoubtedly this is a win for all consumers, who deserve fair treatment and pricing. This will enable all consumers to celebrate during festive season without worrying on any increase on spending," said Puah.

"As the rakyat are aware, the government has been working tirelessly to kerb any increase on cost of living and control food prices, and we hope that restaurants, including Oriental Kopi, will cooperate to align their business models to the government's direction," he added.

In conversation with A+M. Joey Gan, regional VP of PRecious Communications Malaysia said that she never quite understood the idea of businesses hiking during the festive season - specifically during Chinese New Year and only during Chinese New Year. "Sure, fewer businesses operate during the first few days, and demand goes up, but scarcity doesn’t have to mean exploitation," said Gan.

"When fewer competitors are open, you already have a larger catchment of customers. That alone is an opportunity to boost profits without resorting to higher prices. Instead of squeezing consumers during a time of celebration, why not focus on delivering value and building loyalty? Besides, restaurants and eateries in malls tend to stay open all year round anyway. So why would Oriental raise prices is beyond me."

How it could've been better communicated

Syed Mohammed Idid, general manager, strategic communications and stakeholder engagement of West Coast Expressway said there are a number of ways brands can better communicate their pricing strategies during festive seasons such as CNY. 

1. Transparency: Brands should clearly explain the reasoning behind any service charge changes, especially during peak times. If increased service charges are due to higher operating costs during the holiday season, communicating this openly can foster understanding and tolerance among customers.

2. Customer engagement: Engaging with customers through surveys or social media to gauge their feelings on pricing can be beneficial. This involvement can help brands understand customer sentiment and avoid backlash.

3. Timing and framing: When announcing price changes, timing and wording are crucial. Brands should consider the emotions surrounding festive seasons. Presenting price changes in a positive light (e.g., highlighting the added value or service) can soften the impact.

4. Promotional offers: Instead of just increasing prices, brands could introduce limited-time promotions or discounts tied to the festive season that highlight the special occasion and make customers feel valued.

5. Active listening: After any backlash, brands should actively listen to customer feedback and be willing to adapt. Acknowledging concerns can help rebuild trust and maintain customer loyalty.

"For future situations, a proactive approach that emphasises these points could help brands avoid similar incidents and maintain a positive relationship with their customers," said Syed.

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