GLOBAL ENTREPRENEURSHIP

MARKETING STRATEGY OF LAGANI COFFEE SHOP

CASE STUDY: DEMANGAN STREET

Arranged by :

Syaroh Ardhana R. 20160510022

Fauziah Parisa 20160510085
Erzalina Manda K. 20160510092
Fachrizal Anshori B. 20160510093
Nadia Rossa Puteri 20160510109
Ilham Zukhruf 20160510143
Muhammad Ilham Akbar S. 20160510368

Global Entrepreneurship / IPIREL J

Lecturer : Wahyuni Kartika S, S.T., S.IP., M.Si

FACULTY OF SOCIAL AND POLITICS

UNIVERSITY OF MUHAMMADIYAH YOGYAKARTA
2019
 CHAPTER I
INTRODUCTION

A. Background

SLIDE 1
Enterpreneural activities has drive Indonesian economic development
>
The number of enterpreneural activities has developed rapidly
>
There are a high competition inside the enterpreneur world
>
Every actor in enterpreneur activities required to have enterpreneural spirit
(Creative, Innovative, ect.)

SLIDE 2
Demangan is one of enterpreneural activities center in Yogyakarta since 1998
»
The enterpreneural activities that developed there such as clothing, eatery, and
coffee shop
»
Coffee shop itself is generally a small and medium industry (IKM), one of
government program in the economic sector that developed rapidly in Demangan area
»
Lagani is one of the coffee dhop that facing the high competition among other
coffee shop in Demangan area.

SLIDE 3
Research Question :
How is Lagani’s strategy in maintaining its existence and competing with the
other coffee shops in Demangan Area?
Purpose

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 This research will show and determine a marketing strategy of an entrepreneur
to maintain their existence in the rapid business competition.

SLIDE 4
BENEFITS

For the management and the people behind Lagani coffe shop
For the writers of this research
For the DIY government
For the academicians
For the readers of this research

The economy in Indonesia is growing very rapidly. One of the supporting

factors for this development is the entrepreneurial activities in Indonesia. This
happens because entrepreneurship has become an activity that can generate many
benefits for the management if it runs properly. Seeing opportunities for promising
entrepreneurial activities, in this globalization era, the competition inside the
entrepreneur world, especially in Indonesia is very high.
Seeing these conditions, the actors in the world of entrepreneurs are
automatically required to have a good entrepreneurial spirit such as being creative and
innovative. In facing the competition, those entrepreneurs who do not have a good
entrepreneurial spirit will be left behind and eliminated among the intense
competition in the world of entrepreneurship.
The same thing happened in Demangan area, Sleman Regency, Special Region
of Yogyakarta. As an area that has become one of the centers of the growth and
development of entrepreneurial activities which began to develop rapidly since 1998,
Demangan is now an increasingly crowded area and filled with various
entrepreneurial activities. Some sectors of entrepreneurial activities are growing very
rapidly in that area are clothing, eatery, and coffee shops.
Not only increasing the quality of their products and services, the number of
the three entrepreneurial sectors also continue to increase until today. One of the three

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sectors that has increased significantly is a coffee shop. Coffee shop itself is generally
a small and medium industry (IKM), one of government program in the economic
sector. In 2000s, the existence of the coffee shops as one of the entrepreneurial
activities only amounted to approximately 6 places, while nowadays in 2019 the
number has reached 35 coffee shops. Of course, for a small area this amount of coffee
shop was so many (Umar,2018).
Seeing the large number of coffee shops in the Demangan area, of course,
every coffee shop in the area is required to be more creative and continue to innovate
so that they can maintain their existence. This is clearly also faced by a coffee shop in
the area that has been established since 2008, namely "Lagani". They changed their
original name, concept, and location, Lagani continues to serve the best coffee in
town. They keep trying to maintain their business among the competitions that
occurred. Therefore, in this study, we are very passionate in discussing the various
efforts and strategies initiated by Lagani to maintain its existence as one of the best
coffee shops in this area.

B. Research Question
How is Lagani’s strategy in maintaining its existence and competing with the
other coffee shops in Demangan Area?

C. Purpose
This research will show and determine a marketing strategy of an entrepreneur
to maintain their existence in the rapid business competition.

D. Benefits
1. For the management and the people behind Lagani the coffee shop, we
hope this research could be a general guidance to help them in reviewing
their strategy and maintaining their business. Besides, this research also
expected to become a assistance for them to evaluate both the lacks and
the strengths of their strategy, so that they can develop their business better
and become the best coffee shop in their area.
2. For the writers of this research, by this research, hopefully it could help the
writer in examining the whole material of entrepreneurship, the
consequences, and the strategy to run it.

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 3. For the DIY government, we hope that this research could be useful in
order to influence the policies that can support the existence of a small and
medium industry (IKM) by seeing the real phenomena that happened in
the field.
4. For the academicians, this research is expected to be one of materials for
writing and deepening the issues about entrepreneurship.
5. For the readers of this research, we do hope that this research can provide
more information about the whole concept of entrepreneur strategy,
entrepreneurship, and all the consequences that come within it.

CHAPTER II
THEORITICAL FRAMEWORK

A. Marketing

Marketing is all the activities that aims to facilitate the flow of goods or services
from the manufacturer to the consumer in the most efficient manner with a view to
create an effective demand. According to the American Marketing Association (MA,
Marketing is the activity, set of institutions, and processes for creating,
communicating, delivering, and exchanging offerings that have value for customers,
clients, partners, and society at large [ CITATION Kat08 \l 1033 ]. Marketing is
becoming one of the principal activities carried out by businessmen in his attempts to
maintain his survival, to thrive, and get profit. This means doing an activity sales and
purchases a product or service, based on the interests or the desire to buy and sell.

B. Marketing Strategy

According to Lamb, Hair dan McDaniel the marketing strategy as a useful

activity and a description of one or several target markets, it is also related on how to
develop and maintain a marketing mix that will result in customer satisfaction along
with the intended market. Designing a competitive marketing strategy can be started
by doing the analysis of competitors [ CITATION Cha01 \l 1033 ]. The company then
can generally compare between the values and customer satisfaction, with the value

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provided by the product, price, promotion and distribution (marketing mix) against
the competitors nearby.

C. Concept of Marketing Mix

According to Ms Charthy dalam Kotler dan Keller, marketing-mix tools of four

broad kinds, which it called the four Ps of marketing: product, price, place, and
promotion. The marketing mix have a four of a kind which is called 4P: product,
price, place, and promotion [ CITATION Phi12 \l 1033 ]. There are four types where
the 4P are actually intertwined with one another to achieve objectives in the target
market which is a strategy that is executed by the company. As for the understanding
of each of the marketing mix variables are described below:

A. Product
A product is anything that can meet or satisfy the needs and desires of human
beings either tangible or intangible.

B. Price
An amount of money that the customer paid for a particular product. The
company determines the price based on the list prices, discount, discounted rates,
periods, payment, terms of credit.

C. Place
An area where the entrepreneurs conduct the various activities of the
company to make the product, so that product can be consumed and available for
customers.

D. Promotion
Include all of the activities in the company in order to communicate and
endorse its products to the market target. The example of various promotion
forms are sales promotions, advertising, salespeople, public relations, direct
marketing.

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 CHAPTER III
METHODOLOGY

3.1. Place and Time of Research

This research was conducted second times. The first interview was held on
Wednesday March 6 2019 at Jl. Cendrawasih No. 8 or known as Demangan Street.
The second interview was conducted on Wednesday, March 20, 2019 at Lagani coffee
shop which located in the same area of Demangan Street. The location is selected
based on assigned placements in the class. Generally, Demangan Street is one of the
popular business area in Yogyakarta. We did find so many clothing stores, coffee
shops, restaurants, etc.
3.2. Types and Data Sources
In this research, collecting the data used two types of primary and secondary data.
1. Primary Data
Primary data analysis was obtained from both the interviews with a street
vendors and the owner of Lagani Coffee Shop.

2. Secondary data
Secondary data was obtained from some reliable sources such as related
articles, news, and internet.

3.3. Method of collecting data

Data collection methods are done by conducting two ways:

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 1. Direct Observation
Our group directly visited the location and did some observations towards the
place, products, and all the things that are related with our research.
2. Direct Interview
Our group did direct interviews with the owner of Lagani coffee shop as our
main study research, and the street vendor as our other perspectives towards
Demangan area.

CHAPTER IV
RESULT AND DISCUSSION

4.1. Marketing strategy

The trend of coffee shop in Yogyakarta is really high in the recent years.
Many entrepreneurs try to expand their business by opening their own coffee shops.
Not only the expert of business, we can also see a lot of young generation have been
starting their business from coffee shop. In Demangan Area for example, we can find
a lot of business emerge: clothing and culinary business are the major business in this
area.

In conducting this research, we have managed an interview with one of the

successful entrepreneurs in Demangan Street. He is the owner the Lagani coffee shop,
Journey Coffee Shop, 7 Soul Distro, and Flashy Distro. In this research, we would
like to focus on Lagani coffee shop only. Apparently, this coffee shop is the most
successful and most growing business of him. The business competition in
Yogyakarta, especially in Demangan Street is really competitive. The entrepreneurs
are forced to be more active and creative in implementing their Marketing Strategy.

1. Product

The products that Lagani Coffee Shop offer to the customers is the product
that all the coffee lovers need. Lagani Coffee Shop provides a variety of coffee and

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also non-coffee based. Not only focusing on the trend that is happening on today, the
quality of their products also become their first concern. Since Lagani Coffee Shop
established in 2008, they absolutely have a big priority on their loyal consumers.
Therefore, the quality and consistency of their products are being number one. Lagani
coffee shop always maintains the quality of their coffee, they are always processing
and roasting their seed of themselves instead of using an easy way by roasting in other
places.

2. Price

Since the business competitions in Jalan Demangan are getting strict and
competitive, the price of their products has become a crucial thing. A business of
course does not want to lower their price by decreasing their quality, they also will not
let their consumers go and chose their competitors. To calculate an affordable coffee
without having to decrease the quality of the products is a really tricky strategy.
Lagani thinks that the business competition in Demangan Street, especially the coffee
shop competitors are surprisingly beneficial for their business. Demangan Street is
known as a business sector, the price of their products will not extremely down. That
is why the price of Lagani coffee shop is quite affordable and able to compete with
the other coffee shops in that are, the range of the price starts from Rp. 12,000, -.

3. Place

Lagani has a total three stores around Demangan, which are located in Jl.
Cendrawasih No. 4, Demangan, Jl. Komplek Colombo No. 45, Demangan, and also
Journey Coffee The clothing distro is located in Jl. Komplek Colombo No. 37,
Mrican, Caturtunggal, and Yogyakarta. The reason why Lagani is divided into three
coffee shops is because they have not found a big place for their coffee shop. Even
though they have three shops, they are still in the same management and having their
own loyal customer in each area. Therefore, a customer could choose their favorite
place to enjoy Lagani coffee. The owner of Lagani are planning to find a big and
cozy place in order to unite three Lagani into one coffee shop only.

4. Promotion

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 Promotion is an important activity that every business actor should conduct in
order to introduce their product to the wider customers. There are various ways of
promotion done by the marketing team of Lagani. The promotion strategy that Lagani
Coffee Shop took is by joining the coffee events held in Yogyakarta or out town,
giving a promo discount for the customer monthly, opening booth, and becoming a
sponsor in some big events. Lagani also did some online promotion and actively run
their social media such as Instagram.

4.2. Analysis Results of Marketing Strategy

In recent years, the coffee industry in Indonesia has been experiencing rapid
progress. If coffee used to be identical with gentlemen's drinks, coffee is now
becoming one of the favorite drinks of all people, especially the millennial generation.
Coffee with a variety of variants is a mandatory drink when hanging out with friends
or meeting colleagues.
A. The Name
One of the legendary coffee shops that attracks us to do some research is
Lagani Coffee Shop. This coffeeshop was built since 2008 and originally called as
“Flow Coffee Shop” which located in Jl. Cendrawasih no. 04, Demangan, Yogyakarta.
The name ‘Flow’ was then officially changed into ‘Lagani’ in 2010 as a renewal
strategy to give a novelty image. Lagani itself was initially derived from the word
‘Lagani Auna’ which commonly known as another name of ‘Kamboja Tree’. They
believe that the name Lagani sounds cacthier and will attrack more customers
eversince.
Based on the results of direct interview with the co-owner, Lagani itself has
become one of the main four pioneers that initiates the establishment of Coffee Shop
in Demangan street. There are at least 35 coffee shops in 2019 and Lagani still
maintains its existence. Lagani itself actually also engaged in the clothing stores.
There are many local clothing brands that are being supervised under Lagani, they are
Seven Souls, Local, Skaters, and Flashy. Unlike the clothing stores that experiencing
decrease in profits since 2016, coffee shops remain exist and do not lose their loyal
customers.
B. The Consistency of the Taste

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 The competitiveness of coffee shops in Demangan Street itself is not really
significant. On the contrary, the owner of Lagani felt so grateful due to the growth of
Coffeeshop numbers around them. The higher number of coffee shops in Demangan,
the more people will come and stop by. It actually also gives the Lagani opportunities
to do some promotions. From this standpoint, it could be concluded that Lagani itself
is not being bothered by the existence of another coffee shops.
However, Lagani believes that every coffee shop has their own characteristics.
For Lagani, it is very important for them to maintain their consistency in taste. This is
achieved through the quality of their main ingredient where the seeds of coffee are
supplied from Aceh, Sumatera. Eventually, competition is very fierce in this segment.
Lagani believes that they have a unique taste in their coffee as they have received
many good responses from the local coffee lovers.
“We maintain the consistency and quality of our coffee,” said the Lagani co-
owner.
C. The Ambience and Facilities
As university students, we have the freedom to work anywhere — but that does
not mean that all workspaces are created equal. In fact, there are some environments
and ambience that are just better suited to getting the work done. For these last two
years, there are quite a few options for the student who are wandering around a city
with a laptop and a to-do list. We could stop by and rent a spot in something what
they commonly called as a 'co-working space', or we can choose a coffee shop as our
destination.
This is another level of competitiveness for Lagani. As a response towards this
problem, Lagani started to put their attention on their ambience and facilities. Since
there were many demands to keep up their facilities like many other workspaces,
Lagani provided more electrical outlets and non-smoking room for their customers.
Other than that, Lagani also tried to improve their service and cozy ambience so their
customers will feel like they are home while doing their work or just hanging out with
their relatives.

D. Participation in Big Events

In order to make the brand ‘Lagani Coffee shop’ become more well-known,
they also actively participate in some Big Events. They occasionally make a booth
and give a special promotion for the customers that stop by. From this exhibition

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booth, it allows Lagani to introduce their story, sales team, and more importantly their
speciality of their coffee. Moreover, Lagani also actively becomes a sponsorship for
many events.
The government also supports the local coffee shops by not making strict
policy for the the establishment. The coffe shops do not even have to pay for the land
taxes. Since 2017, the government engaged the Tourism and PT KAI to held a
national Coffee shops gathering, and Lagani is one of the special guests that is
annually invited to participate.

CONCLUSION

Entrepreneurs are innovators, and thousands of Indonesians are looking to

startup businesses each year despite knowing the risks behind it. We can see that the
economic activities are significantly growing every day and the economic products
offered on the market are also diverse, even the demands from market itself constantly
change. A very good response from consumers then encourage the entrepreneurs to
become more creative in implementing their market strategy.

Business is not only about the process of the products packaging and then
distribute it to the consumers, indeed, it is so much more than that. Business is also
about how to maintain the quality of a product, decide the most rational price, and
how the creativity of innovation could follow the trend or market demands. These are
one of the things that should be considered by all the entrepreneurs, including the
strategic place to settle a market.
We can look at the Demangan area of Yogyakarta, this area is known as one of
the centers of economic rotation in Yogyakarta besides Malioboro. In Demangan
Street for example, we can find a lot of business emerge: clothing and culinary
business are the major business in this area. The development of coffee shops are
growing as significant as the clothing distro. Until today, there are around 35 coffee
shops exist in this area.

From what we have observed in Lagani coffee shop, they are still
maintaining their business by implementing some marketing strategy. Started from

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changing their name and location, they are still prioritizing the consistency and the
product quality. They are also actively trying to participate in big events and doing
promotion in exhibition booths. Since they already have their loyal customers, they
keep trying not to disappoint them by serving the best coffee in town.

SUGGESTION

We think one of the most important things that should be upgraded in Lagani
is its facilities. Many people nowadays are not only looking for coffee while doing
their project or work, they are also looking for a cozy, private, and creative
environment. Currently, entrepreneurs are starting to combine their coffee shops as
co-working spaces. The concept of co-working has actually emerged in many big
cities such as Bandung, Surabaya, Jakarta, Yogyakarta, and some other big cities in
Indonesia.

What really makes co-working spaces important is because it allows workers

or students to rent workplaces with per-hour rent. With this concept of co-working
space, Lagani will not only provide the customers the best taste of coffee, but also an
ambience that is convenient to become a productive area. Not only that, it is possible
that the target of customers from the concept of co-working space will be wider
according to the market demands.

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Documentary:

Pict. 1 (Group Photo after did an Interview with a Street Vendor)

March 6, 2019

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Pict. 2 (Group Photo with the owner of Lagani Coffe Shop)
March, 20 2019

Pict. 3 (Interview Section with the owner Lagani Coffe Shop)

March, 20 2019

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Pict. 4 (Discussion Group/analyzing field research)
March, 24 2019

Bibliography

Maddox, K. (2008, January). American Marketing

Association.
Retrieved from New Edition of American Marketing.

Charles W. Lamb, J. F. (2001). Marketing. Salemba Empat.

Retrieved april 1, 2019,

Pasigai, M. A. (2009). PENTINGNYA KONSEP DAN STRATEGI

PEMASARAN. JURNAL ILMU EKONOMI STUDI
PEMBANGUNAN, 51.

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Philip Kotler, K. L. (2012). Marketing Management (Vol. 14).
New Jersey: Prentice Hall.

Umar, M. (2018, march 13). Shocking Lab Background

(S.L Salma H., Interviewer)

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