- International coffee chains are eyeing Saudi Arabia, the Middle East’s new coffee hotspot
- But it’s local brands like Barn’s and Half Million who are leading the way with explosive growth through social media
- Half Million reportedly launched with just $130 in 2018 and now boasts 56 stores across over 14 cities
LATELY, the Saudi coffee scene has been quietly but aggressively making its mark. One particular homegrown brand stands out, which has been rapidly growing.
Since its founding in 2018, Half Million has expanded at an extraordinary pace, now boasting 59 stores across 14 cities in the Kingdom.
Its popularity, driven by strategic branding and a social media-driven marketing campaign, reflects not only the country’s growing appetite for coffee but also a wider trend: the rise of national Saudi brands that understand and cater to local preferences.
As Half Million opens its doors to the international market – most notably with its new store on Oxford Street, one of London’s most famous shopping areas – it’s clear that this homegrown Saudi brand is eyeing a much bigger stage.
Half Million’s journey from a single store in Riyadh to an international presence in just six years is emblematic of the brand’s aggressive expansion strategy. Founded in 2018, the chain has rapidly scaled its operations, across the Kingdom. Its recent foray into London, with a shop on the iconic Oxford Street, signals its intent to establish itself beyond the borders of Saudi Arabia.
What is interesting is what sets Half Million apart in an increasingly crowded market.
At first glance, the coffee may not be what wins over its loyal customers. Reviews often highlight that the product itself is not spectacular. Instead, it is the brand’s polished aesthetic and aspirational marketing that have captivated Saudi consumers. The chain has mastered the art of selling more than just coffee; it sells a lifestyle.
The story that is marketed is a humble, heroic one – two friends “marched into the business world with a capital of only 500,000 SR” (the equivalent of around $130) – the reason behind the name. Whether or not this is true (some tell a different story), it is now a full blown enterprise that associates itself with the glitz and glamour of wealthy influencers.
“The entrepreneurs who started Half Million come from very wealthy backgrounds,” says an anonymous Saudi green coffee trader.
“So they could afford taking a hit for a while until they started making money. They were able to play the price war game and open a bunch of locations – many of them premium – while offering cheaper prices for their coffee than others. That’s one of the main reasons they rose to success. The quality isn’t the best, but they made up for that with competitive pricing.”
Central to their strategy, and that of other local brands, is the brand’s symbiotic relationship with social media influencers. Half Million’s success is intertwined with Saudi Arabia’s affluent, social media-savvy youth, who are quick to embrace the latest trends.
The company’s marketing strategy leans heavily on platforms like Snapchat and Instagram (it has 327 K followers), where influencers with large followings share photos of themselves sipping Half Million coffee between their trips to global luxury destinations like Courchevel or Los Angeles.
The brand has capitalised on this lifestyle association, positioning itself as the go-to coffee chain for the aspirational Saudi middle class who want to emulate the luxury experiences they see online. Half Million’s rapid expansion is a testament to how well it has understood and exploited these social dynamics.
Understanding the local market
Half Million’s success is not an anomaly. Its rise is part of a broader trend in Saudi Arabia, where local brands are flourishing in a market that has historically been dominated by international chains.
The Kingdom’s coffee consumption has skyrocketed in recent years, particularly among young Saudis who see coffee shops not just as places to grab a quick drink, but as social hubs where they can meet friends, work remotely, and be seen.
In 2022, Saudi Arabia’s branded coffee shop market grew by 18.5% to reach 3,550 outlets. Saudi Arabia is positioned among the top 10 highest coffee-consuming countries, with demand exceeding 80,000 tonnes per year.
As Saudi Arabia modernises, fueled by the ambitious Vision 2030 plan, a sense of national pride is also driving the success of local brands. Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), launched Saudi Coffee Company in May 2022 – which is investing $319 million over the next ten years to support the growth of the national coffee industry – from production to consumption.
This is where Half Million and Barn’s – the largest chain in the country with 700 stores – have found their sweet spot. It’s not just selling coffee; it’s selling a lifestyle that combines local culture with global aspirations. It knows how to cater to the luxury tastes of Saudis while maintaining accessibility for the average consumer.
Despite opening its 400th store in the Kingdom in 2023, Starbucks is struggling to compete with local brands – also due to geopolitical unrest in the region and boycotts over perceived support for Israel’s ongoing military offensive in Gaza.
While Starbucks may focus on its consistent global offering, Half Million understands that the Saudi market craves a blend of familiarity and aspirational novelty.
“We Saudi people started to support local brands because they have our standards,” says Badr Alkurashi, R&D Manager at Saudi Coffee Company.
Homegrown chains like Half Million have an edge over global competitors like Starbucks because they are more attuned to the unique cultural nuances of the Saudi market. Local brands are better positioned to cater to these preferences, from menu items that reflect local tastes to marketing that resonates with the younger, social-media-driven consumer base.
“They won over Starbucks because it’s an American brand – not a local brand,” says anonymous. “So people want to support ‘local.’ Half Million customers are after the lifestyle and glamour, not so much the taste or quality. If it looks good and tastes ok and is affordable, that’s a winning recipe.”
It’s also worth noting that the size of the Saudi market dwarfs that of its regional neighbours. The UAE, often seen as a hub of luxury and innovation in the Gulf, is comparatively small. Saudi Arabia, with its large population and rising disposable incomes, presents a much larger and more lucrative opportunity for brands like Half Million.
Coffee consumption is booming, and with it, the potential for sales. Even with its rapid expansion, Half Million is still just scratching the surface of the Kingdom’s demand for premium, experience-driven coffee.
Can Half Million and other Saudi brands sustain their growth?
While Half Million’s growth has been impressive, it begs the question: can this momentum be sustained?
For a brand that is pouring significant resources into expansion, the operational costs—particularly in a city like London—are not small. Rent, labour, and sourcing high-quality ingredients all add up, and it’s not entirely clear how Half Million plans to maintain profitability in a market where foot traffic, particularly outside of peak hours, can be inconsistent.
One potential strategy is to emulate the trajectory of international coffee brands like Blue Bottle, which scaled aggressively before selling to Nestlé in 2017.
With investors becoming increasingly excited about the prospects of homegrown Saudi brands, Half Million may be positioning itself for a similar exit. Venture capital has already played a significant role in the growth of other coffee chains, such as Blank Street in the U.S.
Half Million could be looking to capitalise on a similar strategy, growing quickly to build brand recognition and customer loyalty before seeking investment from a major player in the global coffee industry.
“The entrepreneurs behind Half Million are a very well-known and rich family, and their business strategy is low profit with high volume in all sectors,” says Badr. “They are incredibly well established in terms of product, services, consistent quality, locations, and prices.”
However, the Saudi market presents some unique challenges. While influencer-driven marketing has propelled Half Million’s rise, it’s uncertain how long this strategy can hold.
Social media trends are notoriously fickle, and what is in vogue today may not be tomorrow. The brand’s reliance on influencers, while effective now, could be a double-edged sword if the winds of social media change. Its website presence is also minimal, with the bulk of its marketing taking place on social media platforms. This reliance on social media, while great for short-term brand awareness, may not be enough to sustain long-term customer loyalty.
Despite these challenges, Half Million’s aggressive expansion—both in Saudi Arabia and abroad—signals its ambitions to become a major player in the global coffee market.
“They can sustain their growth in the long term because they have gotten to a point where they’re like Dunkin Donuts or one of those brands that people just want regardless of not being the best,” says anonymous.
Investors appear willing to bet on the brand and coffee in general, seeing it as a potential Saudi success story with the ability to export its winning formula internationally. Whether or not this strategy will pay off in the long term remains to be seen, but for now, Half Million is riding a wave of rapid growth and influencer-driven success that shows no sign of slowing down.
Half Million is more than just a coffee chain – it’s a reflection of Saudi Arabia’s broader transformation. As the Kingdom modernises and its consumer landscape shifts, homegrown brands like Half Million are at the forefront of a new wave of Saudi entrepreneurship.
The brand’s rapid expansion, influencer-driven marketing, and international ambitions signal that it is ready to compete on a global stage. But with high operating costs, a fickle social media landscape, and fierce competition, the question remains: can Half Million sustain its remarkable growth?
For now, it seems, the brand is intent on making its mark – not just in Saudi Arabia, but across the world.
Coffee Intelligence
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