Global brands are waking up to the massive opportunities of the worldwide Muslim market but many still misunderstand or ignore the potential of a burgeoning sector that is young, highly educated and collectively has enormous spending power.
The world’s 1.6 billion Muslims constitute a largely untapped commercial market, the Muslim Lifestyle Expo conference in London heard on Thursday. The halal market is worth $2.1tn (£1.5tn) annually worldwide, and is increasing at $500bn a year.
“A huge opportunity is being missed by corporate brands, but [the market] is being taken by storm by young Muslim startups,” said Shelina Janmohamed, vice-president of Ogilvy Noor, an Islamic branding agency.
She pointed to recent indications that global brands were beginning to target Muslims. A decision by Marks & Spencer to sell a range of ‘burkinis’ – full-cover swimsuits – in the UK last month prompted heated debate. H&M, one of the world’s biggest fashion chains, attracted attention with an ad featuring a model in a hijab last year. Tesco ran a promotion for the Muslim holy month of Ramadan last June – although it was ridiculed when one store included smokey bacon flavoured crisps in its display.
But there was still a long way to go, said Janmohamed. “One of the complaints we hear is that Muslim consumers feel they are not engaged with, as businesses do not reach out to them,” she said.
Tabish Hasan, chief executive of the US-based Muslim Ad Network, compared the failure of major brands to tap into the Muslim market now to a similar disregard of the potential of the Hispanic market in the US in the 1980s. “Now those brands can’t afford not to engage with the Hispanic market,” he said. “The Muslim lifestyle market is moving in the same direction – it’s so big, it has so much spending power. It’s just a matter of time.”
Janmohamed said her company’s research had found that more than 90% of Muslim consumers said their faith had some influence on purchases. They wanted food, beverages and personal products to be sharia-compliant, but showed more flexibility in products and services such as finance, insurance and travel.
Although most wanted acknowledgement and engagement from global businesses, some worried that corporations were motivated by the chance to profit from the Muslim market, she told the Guardian.
Some big brands had faced a backlash against initiatives aimed at reaching Muslims, said Hasan. He cited a well-known US chain whose inclusion in publicity material of the greeting Eid Mubarak, to celebrate a Muslim festival was met with a storm of criticism. “It has made a lot of companies hesitate.”
Janmohamed said Muslim consumers broadly fell into two groups: futurists and traditionalists. Futurists combined faith and modernity. “They’re proud to express their Muslim identity, but are also brand-conscious and brand-loyal. They are open to the world, very tech-savvy and very engaged in social media.” Futurists – also described as “Generation M” – were younger and had influence disproportionate to their numbers, she added.
Navid Akhtar, chief executive of the Islamic television production company Alchemiya, sketched out a similar group, which he dubbed global urban Muslims, or “gummies”. They were “hyperdiverse, spiritual rather than Religious-with-a-capital-R, educated, transnational – their family may be originally from Pakistan but now could be scattered across Canada, South Africa and the UK – they have a high disposable income, and the vast majority are English speakers.”
A key subset of gummies was “mipsters” – Muslim hipsters, aged between 16 and 24, whose hallmarks were identity, image, fashion, friendship and education, he added.
Young Muslim entrepreneurs were responsible for an explosion in small business startups marketing products and services, particularly in the spheres of fashion, cosmetics and personal products, and food. “When a young Muslim consumer doesn’t find a product that they are looking for on the high street, their instinct is to go and create it themselves,” said Janmohamed. “Consumer power determines what works.”
Altaf Alim of fashion brand Aab said his company wanted to bring the quality, presentation, packaging and customer experience of an upmarket western store to Muslim consumers. Until Aab was launched eight years ago, women had little choice but to buy hijabs and abayas from market stalls. “What was missing was an aspirational lifestyle brand. There was no premium option,” he said.
Serendipity Tailormade, another upmarket Muslim business, offers halal holidays and tours to a growing market. “You can’t go to Kuoni or Trailfinders and expect them to understand that you don’t want alcohol in your hotel room,” said Nabil Shariff. His company’s typical customer was aged 24-32, professional, with a keen appetite for travel. About 70% were honeymooners. Demand for halal-friendly hotels well outstripped supply, he said.
Other Muslim startups included the London Beard Company, which sells halal beard oils, Saaf skincare products, and The Halal Guys, originally a New York fast-food cart which now has 200 restaurants in development in the US, Malaysia, Philippines, Canada and Indonesia.
Women were particularly well placed to start businesses, said Shariff. “The sisterhood network is massive. Any woman who wants to go into business has a huge network sitting right under her nose. Personally I think there are greater opportunities to start a business as a Muslim woman than a man because of the reach they have,” he said.
Originally published on www.theguardian.com