We stand on the crest of a wave that is the rise of a global Muslim market.
In the 2014 –15 State of the GLOBAL ISLAMIC ECONOMY Report by Thomson Reuters, it is stated that the organisation “…estimates that the global expenditure of Muslim consumers on food and lifestyle sectors grew 9.5% from previous years’ estimates to $2 trillion in 2013 and is expected to reach $3.7 trillion by 2019 at a compound annual growth rate of 10.8%. This forms the potential core market for Halal Food and lifestyle sectors.”
Download the report (State of the GLOBAL ISLAMIC ECONOMY) HERE!
The Muslim market is expected to grow in fashion, food, lifestyle, media and recreation, pharmaceuticals and cosmetics and the financial sector.
But how do we access this market? How do we ride the wave down and reap the benefits of a burgeoning market?
The answer is simple: You have to understand the values that drive the decisions of the consumers in the marketplace.
Ask yourself: What are the values of Muslim consumers that are DIFFERENT than what mainstream marketplace is not addressing? More importantly, if you are currently operating in the mainstream, ask yourself, “What business practices are considered inappropriate in the Islamic tradition?”
There are two words that dominate the market decisions of Muslim consumers: Halal and Haram. Halal refers to everything that is allowed by the tenants of the faith and Haram is everything that is not allowed by the tenants of the faith. These two words represent the core value of what motivates and drives a Muslim’s actions. It is also what drives lifestyle choices for all muslims from what they wear, to what they eat, even to how they finance their homes.
A Muslim happens to be thirsty, and you offer him a glass of alcoholic drink and a glass of water. Why would he choose water over the alcoholic drink? Both is capable of quenching his thirst. But is it thirstist that dictated his action of choosing the water over the alcoholic drink or perhaps something else? A Muslim happens to be hungry, and you offer him a plate of food with meat that was slaughtered according to the sharia principles and one was not. Why would he choose to eat the meat that was slaughtered according to the sharia principles and not the other? Both plate of food is capable of satisfying his hunger, but he chooses one over the other. Again what is it that dictates or governs his choice? If you can figure out and understand what this element is then you will have unlocked the secrets to this trillion dollar market.
Let’s look at four examples of how this works (or didn’t work out for a major chain):
Example 1: Women’s Fashion and the Muslim Market
In 2004 I started a fashion label targeting Muslim women looking for modest, yet modern and fashionable clothing. The fashion label, called Islamic Design House, hit upon a previously untapped wellspring of need of these women who didn’t have alternative clothing options. We hit upon something, because after 10 years we are now trading in over 60 countries worldwide with over one million people in our fan base on social media.
Why were we so successful? At the time we started Islamic Design House, very few mainstream brands (western brands) had yet to conceive the potential of the Muslim market so didn’t offer any trendy, fashionable clothing options for young Muslim women. This untapped market is a niche that is a fast growing consumer base. Not only did we create a product that resonated with the consumer, but we also understood how to market within this growing niche.
Example 2: A Food Chain that Failed At The Muslim Market
For many years I lived in a part of London that was primarily Muslim based, though from many different ethnic backgrounds. Some budding entrepreneur bought a chain franchise and put it in the community. After a few years, that McDonald’s closed down due to poor business. How could one of the world’s largest food chains, with only a 5% failure rate fail in one of the world’s largest cities?
The answer was profound. The McDonald’s store failed because its surrounding market was mostly Muslim and the McDonald’s did not serve Halal meat. Its burgers did not come from beef that was slaughtered according to the sharia principles. So no matter what McDonald would do, be it improve their customer service, the cleanliness of their store, offer discounts, or any other strategy they adopted, it would not have turned the business around unless they addressed a fundamental decision making value held by the people in their catchment area.
Example 3: A Food Chain that excelled at accessing the Muslim Market
In the same community as the aforementioned McDonald’s, there was a KFC. In 2009 I saw a sign that indicated that the store was closing. Much like the issue with McDonald’s, the KFC store did not serve Halal meat. This closure did not surprise me, what did surprise me is that the KFC reopened a few months later. It became so wildly successful that it stayed open I every night till 12am in the morning, that’s how packed and busy it got. KFC profoundly changed their traditional business model to accommodate the needs of their customers- KFC introduced chicken that was halal, i.e slaughtered according to the sharia principles of slaughtering. Now KFC has over 90 stores in London which serve Halal Chicken and every single of the stores are profiting from the new found business. Again, I am aware of this because one of my friend was involved as a lead lawyer in the project KFC undertook to go halal.
Example 4: The Shopping Mall Food Court that Learned the Hard Way
I have one of the biggest Westfield’s shopping malls 10 minutes drive from my house. When it first opened about 2 years ago, they were allowing free parking to drive traffic. This led to a lot of foot traffic. Like all malls, they have a food court selling all types of food from around the world. Not a single store was serving halal food except one Indian restaurant, owned by a Muslim. His restaurant was, being the only halal serving restaurant, the choice for all the Muslims who came to the mall.
The other restaurateurs, noticing his success, followed suit and now 95% of the restaurants are all serving halal meat. This is an excellent example about how the market shifted the supply, so much so that many of the restaurateurs take extra care to keep all their pork based products away from the halal meat, even taking extra care to keep utensils separate.
How to turn your business into a Muslim-friendly business.
The Muslim market is driven by the core values of halal and haram. Understanding what is halal will help you in deciding what business practices you should adopt to drive, delight and inspire the muslim marketplace. Creating products that specifically target a lifestyle that is halal will allow you to access a specific niche that no one, as of yet, is filling in this rapidly growing marketplace.