Tackling the Brand Risk in marketing to the global Muslim community

1. The Halal Journal | Nov+Dec 2010 | 24
Words by
Joy AbdullahMARKETING TO GLOBAL MUSLIMS
Identifying and understanding brand risks
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2. The Halal Journal | Nov+Dec 2010 | 25
What lead to this
phenomenon?
In the past decade, Asia’s one
billion-strong Muslim population
has grown by 12 per cent. In
Europe, the gain is closer to
140 per cent, rapidly outpacing
the rest of the population.
More than 30 million Muslims
live in the Russian Federation.
In Britain, Muslims are the
quickest-growing segment of
the middle class, chalking up
an average of 3.4 children
against the national average of
1.9. At current growth rate it
is projected that 50 per cent of
the world’s population will be
Muslims by 2050; resulting in
an already discernable shift in
global economic power. In four
years, the GDP (Gross Domestic
Product) of BRIC (Brazil,
Russia, India and China) plus
Indonesia, Turkey and Mexico
will be 11 per cent higher than
that of the current G7 countries.
With such critical mass,
has come spending power. The
Halal food category is estimated
at USD560 billion, in which
America’s eight million Muslims
spend a reported USD170
billion annually while, those
in the UK fork out USD31.5
billion, and those in France
another USD7.1 billion a year.
Other key categories like Islamic
finance are estimated to be at
USD400 billion and growing at
about 15 per cent a year. The
availability of new products and
services and a rising demand
for mainstream products and
services is making the global
Muslim market a very attractive
segment for brand marketers.
What does Halal mean today?
Traditionally, the term
“Halal” was associated with
the dietary requirements of
the Muslim community. It
meant avoiding pork and
alcohol and buying specially
slaughtered meat. But now,
young global Muslims, with
strong purchasing powers are
hungry for more mainstream
products and services that fulfil
their specific needs—giving rise
to a host of categories under
the umbrella of Halal category.
Who are today’s Global
Muslim Consumers?
70 per cent of the Arab world is
under 25-years-old, while two-
thirds of the Muslim community
in Europe and North America is
under 30. Given this “youth” of
the global Muslim community,
it is no wonder that categories
like cosmetics and fashion is
becoming more and more
popular. Halal cosmetics are one
of the fastest growing sectors of
the Halal industry, worth around
USD560 million annually (as
per Epoc Messe Frankfurt).
Identifying the risks
For a brand entering this market,
the planning requirements are
not any different from entering
any other market or segment--
identifying the key markets,
researching the impact of the
existing product portfolio on
the Muslim community of
that market, evaluating the
competitions’ actions in order
to benchmark and obtain best
practices and finally doing an
opportunity cost analysis to
obtain earnings and brand
sustainability—are all but a
must in planning for establishing
a successful brand. But the
key is in understanding the
psyche and emotional needs of
the young Muslim consumer.
Especially given that they
are online and tech-savvy.
Quoting the Marketing
Week, “Muslim consumers
are a growing, influential and
extremely loyal group, making
them a desirable market
for mainstream brands. But
reaching them requires more
than launching Shariah-
The global Muslim consumer market segment
is intriguing marketers across product categories
as the global Halal industry has exploded!
Spanning from food, to fashion, to finance and
pharmaceuticals, Halal today is big business, and
multinationals and independent entrepreneurs are
scrambling for a piece of the USD2 trillion market
(as estimated by the global consulting group AT Kearney).
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3. The Halal Journal | Nov+Dec 2010 | 26
compliant products. Making
inroads to this sector takes deep
understanding of the values of
this community and building
the brand from there. They’re
young, ambitious and worth at
least USD2 trillion globally”.
The key words above are
“deep understanding of the
values of this community and
building the brand from there”.
The foundation of which is
in the concept of Halal itself
that goes beyond just food and
drink, and is a way of life.
“Young Muslims are, for
want of a better phrase, ‘more
Muslim’ than their parents,”
says Lisa Mabe of Hewar
Communications-Washington
DC. “They do feel as though
wearing their religion on their
sleeve is a way to say ‘Hey,
this is who we are and this
is what Islam stands for.’”
This is the key point in
developing a strong brand
identity for the global
Muslim segment where the
differentiation from other
consumer segments comes
in. Understanding and
applying this concept in
developing the brand involves
evaluating closely the risks and
organisational demands that
are involved in the process.
The risks should not be
underestimated. They should
be thoroughly studied and
evaluated on two levels:
1. Product/ Brand level
A product and brand risk
analysis considers the impact
that targeting the Muslim
consumers might have on
the organisation’s core global
brand if the product is sold
in the western markets of
UK, Europe and USA.
Why such product and brand
risk analysis is necessary:
(a) In Europe, the popular
French burger chain, Quick,
announced its intention
recently to boost its Halal-
only outlets from eight to 22
to meet demand; it was hit
from all sides. Right-wing
politicians accused it of selling
out its mainstream clientele,
while Islamic groups branded
the gesture pointless, unless
its restaurants become Halal
through-and-through.
(b) In Birmingham UK,
Domino’s Pizza chain
ditched its Halal-only menu
after just eighteen months,
when sales of the pork-
free pizzas plummeted.
(c) Nike failed miserably
with the launch of its 1996
line of Air basketball shoes.
The brand logo, a flame-like
graphic of the word ‘air’, was
deemed by the Council on
American-Islamic Relations
to look too similar to the
Arabic script of ‘Allah’. Nike
was forced to recall 38,000
shoes, scrap the logo and
make its apologies in the
form of sports facilities for
Islamic schools and free Nike
products to Muslim charities.
2. Corporate level
A corporate level risk analysis
takes into account a wider
view of potential transnational
consumer activism thereby
enabling the organisation to
be prepared to deal with at
least three potential threats—
social, political and financial.
(A) Social Risk:
by virtue of their numerical
strength and purchasing
power, the Muslim consumer
can choose “not to buy”.
Such “not to buy” acts are
not uncommon. Recall the
indignation and, subsequently,
the impact the global Muslim
community had over the
publication of cartoons of our
beloved Prophet (p.b.u.h.) in
a Danish newspaper. The
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4. The Halal Journal | Nov+Dec 2010 | 27
hj
About the Author:
With dual expertise in strategic business planning and brand marketing, Joy Abdullah is a Brand
Enabler and is one of the directors at Daily Baraka Ltd – a business and brand marketing
consultancy based in the UK with the objective of enabling organisations to deliver quality products
and services to the global Muslim community. Such synthesis of strategic planning enables Joy to
aid brands in having a strong reputation, clear image and efficient delivery. By using ethics, values,
governance requirements and desired brand objectives in corporate planning, Joy minimises potential
risks a brand may face, in developing the brand’s experience (to its stakeholders). He has strong
knowledge of ASEAN & Indian markets. He has written many articles on the importance of ethical
brand marketing encompassing brand reputation management, employee-brand relationship and
CSR. His articles can be viewed at www.dailybaraka.eu and at www.opalesque.com/index.php/
archiveOIFI. Daily Baraka: “We enable brands, whether they are our own brands or ones for which
we consult, that are Halal and specifically target to fulfil the needs of the global Muslim community.”
subsequent lack of political
and cultural empathy led
to a widespread boycott of
Danish products to the extent
that even western retailers
removed Danish products
from their shelves due to fear
of negative repercussions.
Such risk of “backlash” exists
if the organisations are seen
to be “exploiting” the Muslim
consumer. With the rise of
social media, and “interest
communities” being online
24/7 blurring geographical and
cultural distinctions, a backlash
(on a brand) can spread like
bushfire through the global
Muslim community in a matter
of hours, thus affecting the
brand not in just one specific
region but globally across
the markets it is present in.
(B) Political Risk:
Given the rising awareness
of Islam, and a new found
resurgence of the Muslim
identity, governments across
Muslim countries have
responded with regulatory
changes. Malaysia, for
example, has created its
competitive advantage by
promoting Halal foods,
Islamic Finance and Halal
tourism. Kuwait had its first
women ministers a year ago
(ref: www.guardian.co.uk).
(C) Financial Risk:
An existing organisation has
to evaluate the potential
‘fallout’ that may occur
through alienating the existing
consumer base by entering the
Muslim consumer segment
AND also has to evaluate
potential revenue loss from
not correctly serving the
Muslim consumer. This
needs to be balanced out
versus the projected revenue
growth expected from serving
the Muslim segment.
Given that, today, Muslim
consumers are radically
reshaping the face of mass
consumerism and that the
umbrella category of Halal
will grow far beyond its anchor
product of food and finance
to include housing, cars,
furniture, holidays, and so on,
all developed in accordance
with Shariah principles.
Marketing to the global
Muslim community would
have to ensure, re-assuring
the Muslim consumers, that
the brand offered is not just
a “marketing ploy” but a
genuine approach, in sync
with Islamic values and
principles in all aspects of
the brand’s operations.
Towards this, communicating
transparently, acknowledging
Muslims in the brand
communication, providing
a beneficial, relevant and
meaningful brand experience
will enable a brand to reduce
and control risk to a great extent.
“Young Muslims are ‘more
Muslim’ than their parents,”
says Lisa Mabe of Hewar
Communications-Washington DC.
“They do feel as though
wearing their religion on
their sleeve is a way to say
‘Hey, this is who we
are and this is what
Islam stands for.’”
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