The global Muslim community, today, is comprised of diverse, socio-culturally influenced, consumer groups i.e.: each segment, that makes up the global Muslim consumers, is from a specific set of social, cultural values and practices.
These socio-cultural characteristics influence and affect the decison making behaviour of the Muslim consumer with regards to his/her need fulfilment and brand preferences.
The question, today is, “brand” important to the Muslim consumer? Or are we trying to make do, the best we can, with what’s available as ‘halal’ certified brands?
As consumers, brands are of high importance to the Muslim consumer. Here’s some feedback from a recent forum discussion:
1.’Brand value is not important it is more of status symbol for individual, rightly said it is social driver of having to fit in with the peer group.”
2. “…Muslims personally that will only buy name brand clothing whether it is Islamic or Western styles”.
3. “I go for brands however never undermine quality and value for money.”
4. “Brands will always be part of our lives, Muslim or not, but as humans, we are inclined to buy them as the companies are good in their marketing strategies, making out that this or that particular item is something we can’t live without!”
As one can see the perception of what is a brand is similar as with other consumer segments. In addition ‘quality’ and ‘price’, are strongly associated with the brands’ identity in developing the perception. In fact there exists a mental parameter/checklist of quality vs. price when making a purchase decision. And there are other, clear, influencers in this psychological brand selection process.
But probing deeper what comes out is the lack of clarity with regards to ‘halal brands’.
Currently, we justify (rationalise) why we are using the brands that we use in our daily lives. And one of the key reasons for that is because of:
(A) Unavailability of halal brands for daily use i.e.: cosmetics for men and women. It’s a category which currently has a few brands. But these are geographically limited. Whilst the need exists, probably financing, production and marketing logistics inhibit the existing players from taking their products on a regional and global scale.
(B) Varying disposable income of the global Muslim community: This is a key factor in affecting marketing forecasting and possible business growth. Data available shows that the Muslim purchasing power is not in sync with the population concentration but just the reverse. Therefore current manufacturers have gravitated towards the centres where the available disposable income is high and there has been a re-surgence in awareness of using halal certified products and where the Muslim community is willing to pay a premium for “halal”.
However, this does becomes a deterrent (but not an obstacle), when we need to take the same product to another region/country, where the purchasing power is not so high and yet the need exists.
(C) Certification: The lack of a global halal certification or acceptance of one common and accepted standard leads to the cumbersome process of having to obtain halal certifications both in the country of manufacture as well as in the country the brand is being marketed. This often has acted as a deterrent to many aspiring businesses.
(D) Financing: In order to operate on a regional and global scale, financing for the businesses become a critical factor. However, Islamic Finance is yet to look into the overall Halal category fully, as a potential investment avenue (it is coming about, so there is light at the end of the tunnel). But, at present, lack of financing has led to businesses having to operate on a smaller scale and either as a fully-export unit or restricted to geographically limited marketing that possible within its opeartional cash flow limits.
So, with 23% of the world, requiring halal brands the question remains– are “brands” important to the Ummah?
If the answer is in the positive, then it’s time that the Islamic Finance industry and the global Halal industry bodies, jointly, approach development of specific halal categories–fashion, pharmaceuticals, hospitality– over and above the halal food industry. And from the consumer side, the consumer bodies, assist entreprenuers in obtaining financial assistance in order to make available brand choices.
Needless to say, the single most important benefit arising out of such an endeveour would be the enormous economic benefit that would come about which would benefit business and society in a positive manner on a macro level.
However if the answer is negative then, I guess we’ll be the only global community where brands are not important.