Understanding what Muslim consumers want

Monash University Malaysia takes a multidisciplinary approach towards research in Islamic marketing to delve deeper into what constitutes halal, and how it affects consumer behaviour.

Associate Professor Dr Muhd Yunus Ali

Islamic marketing may be a relatively new specialisation in the world of marketing but it is nonetheless a critical one, considering the burgeoning Muslim population, and correspondingly, market for halal products and services globally.

According to the State of the Global Islamic Economy 2014 - 2015 Report by the Dubai Islamic Economy Development Centre, Thomson Reuters and DinarStandard, global Muslim spending on food and beverage increased 10.8% year-on-year to US$1.29 trillion in 2013.

Closer to home, figures by the Malaysia External Trade Development Corporation (MATRADE) showed the country’s total halal exports for first half of 2015 valued at RM19.5 billion, up 3.6% from the same period a year earlier.

With 1.6 billion Muslims worldwide – a fifth of the world’s total population – and more than half of Malaysia’s 30 million citizens being Muslim, one simply cannot afford to ignore the Muslim market, which many still consider a “niche consumer segment”.

“Those who marginalise Muslim consumers will be the ultimate losers, as even multinational corporations are beginning to focus on the Muslim consumer. The market is growing significantly and consumer awareness is growing fast because of social media,” says Monash University Malaysia Associate  Professor Dr Muhd Yunus Ali.

Globally-recognised Islamic marketing research

As the director of graduate studies for 5 years at the university, Yunus was tasked with developing the PhD and graduate programme, and in 2011, he began developing the Islamic marketing units for advanced level undergraduates of the Bachelor of Business and Commerce programme.

Islamic marketing research is still in its infancy. That’s a challenge that is discussed at major conferences on Islamic marketing. The positive thing is that mainstream marketing and business journals have acknowledged the potential growth of Islamic markets in spite of this,” he says,  adding that he was recently invited to submit a book proposal on Islamic marketing by UK-based publisher Routledge.

Yunus’ research efforts in the field of Islamic marketing have been recognised internationally, most recently named the Islamic Marketer of the Year Award by the International Islamic Marketing Association (IIMA) at the 7th Global Islamic Marketing Conference in Casablanca, Morocco on May 5th  for his contributions to the research and education on Islamic Marketing.

“It was an unexpected win but the chair of IIMA encouraged me, saying that this is recognition of what I have worked on so far. I’m happy to have involved my colleagues and students in my journey thus far, as my students contribute to the research,” says Yunus, who is a member of the  IIMA executive committee.

Six months earlier, three groups of Yunus’ Islamic marketing students from the School of Business were selected to present at the Academy for Global Business Advancement’s 12th World Congress, which was held in University Malaysia Pahang in November 2015.

One of the research papers that Yunus co-wrote with his students, entitled, Muslim Consumers’ Halal Consumption: The Role of Emotional and Religiosity Factors in Buying Attention, won the Best Paper Award of the conference.

Multidisciplinary approach towards halal products

“Currently, we’re building an Islamic business education programme at Monash under the halal ecosystem platform. We’ve established a multidisciplinary research platform and we’re collaborating with external partners too. In the long run, we plan to offer a major in Islamic Business in the School of Business and to establish a halal centre of excellence at  Monash,” says Yunus.

So far, the halal ecosystem has already developed five units of Islamic Business including Islamic marketing for business undergraduates. The plan is to develop a total of 8 units for the Islamic Business major programme, which will incorporate research from Monash’s other academic schools.

Halal, he says, involves entire management systems, hence the need for multidisciplinary research.

“The School of Medicine is looking at the effects of hormones in meat when slaughtered in the halal way versus the non-halal way, while the Pharmacy department is looking at identifying ingredients in pharmaceutical products to see whether they are halal or not,” Yunus explains.

Yunus has been completing a research project on Muslim consumers’ halal brand selection behaviour, which is funded by the Ministry of Education under the Fundamental Research Grant Scheme (FRGS). “For this project, initially we started with focus groups, and we used the data as a basis to design eye-tracking to monitor the visual movement of consumers’  eyes. This is to see how many people concentrate on the halal logo and other brand selection cues, for how long, how easily observable the logo is on good packaging and how it helps influence purchasing behaviour,” he explains.

He is currently applying for a research grant from the Ministry of Science, Technology and Innovation (MOSTI) for extension of his current area of research, which employs advanced behavioural science methodology.

From the electroencephalogram (EEG) brain activity recorded, Yunus then observes how much of the brain is concentrating and analysing information – which helps researchers understand how purchasing decisions are made. Based on the findings, the next step is to design packaging that makes it easy  for consumers to find information they are looking for, and to hopefully commercialise the packaging design.

Challenges in the field of Islamic marketing

One of the main challenges in Islamic marketing is satisfying the needs of the diverse Islamic market, which is not a homogenous one.

“A recent research showed there are conservative Muslims, ‘New-Age’ Muslims, liberal Muslims and social pragmatist Muslims. Their expectations are different. Marketing is not only about selling products but understanding their needs and ways of interpreting information. Increasing  market potential is to get the information about your market, and then translating that information into designing products and services for consumers,” he says.

Another problem faced by Islamic marketers is the lack of a unified halal standard that is accepted internationally, as different countries abide by their respective halal certification. “In Islam, there are different schools of thought and religious scholars have different opinions. Another project we plan to look into is how to develop a halal score to rank the different certification for integrity,” he says.

While Malaysia enjoys good government support for halal products and is internationally recognised as among the pioneers in establishing a halal standard, its weakness lies in the implementation stage, Yunus says.

“Every time there is a change in state government, there are different agendas so efforts differ by state. Every state has halal manufacturing hubs but they are underutilised. There also needs to be stronger effort in marketing Malaysian products internationally,” he quips.