Engaging the global Muslim consumer
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Engaging the global Muslim consumer



Engaging the global Muslim consumer

Engaging the global Muslim consumer
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Engaging the global Muslim consumer Engaging the global Muslim consumer Document Transcript

  • The Muslim opportunity:Engaging a globalconsumer groupby Samar BirwadkerAugust 2011
  • This PDF is designed to be printeddouble-sided to help you conserve paper.© 2011 Landor Associates.All rights reserved.Landor Associates is one of the world’sleading strategic brand consulting anddesign firms. Landor is part of WPP, one ofthe largest global communications servicescompanies. Visit us at landor.com.
  • The Muslim opportunityEngaging a globalconsumer groupWith consumption in many European • Arab Spring of 2011 proves Muslims are willing Samar Birwadker is senior insightscountries and the United States reaching to stand up for the freedom, individuality, fairness, manager in the San Francisco officea plateau, companies are turning to previously and equality that religious extremists repress. of Landor Associates.untapped global economies to fuel growth andbuild market share. In the search for the next • Over half the population of the “Next 11” countries, A slightly different version of thisChina or India, most brands have overlooked which Goldman Sachs considers promising article is forthcoming in MediaPost.a global opportunity that’s just as big, if not for investment and future growth, is Muslim.1 mediapost.combigger: Muslims. • The market for halal-compliant products orHow can global brands engage with Muslim services (meaning they conform to Islamic law)consumers? totals $2 trillion annually and is growing rapidly.2The opportunity • The global Muslim population is expected to grow at twice the rate of the rest of the world, andScattered across the world, Muslims are bound over 40 percent of the global Muslim populationby a mutual outlook, their Islamic faith or imaan. (or 11 percent of the total world population) is partThis group has long been falsely perceived as of the lucrative under-25 age group.3a marginal subset of the global market, lackingcritical mass to drive demand. But these percep- Understanding the Muslim belief systemtions are changing given an emerging Islamicidentity that is centered less around politics and In the United States and much of Europe, brandreligion and more around a shared purpose and managers are used to segmenting consumerslifestyle. The power and influence of Muslim based on demographics, psychographics, and lifeconsumers cannot be ignored: stages. Muslim consumers cannot be categorized Landor Associates 1 View slide
  • You don’t have to be a Muslim brand to appeal to Muslim consumers. Any brand that can help Muslims with their search for purity will succeed. by geography or income but instead by their level a large percentage of Muslims are liberal: of adherence to Islam. On the surface, Islam may often younger and more affluent, broad-minded, seem to be one of the least uniform religions: independent, assertive, and not very particular there are Sunnis, Shiites, Sufis, and several other about dated traditions that could keep them from movements in 72 countries, interpreting the faith living a globally relevant lifestyle. differently and practicing at varying levels. But in spite of their differences, the majority of Muslims Key takeaway: Muslims live a more cosmopolitan are bound together under a common imaan that lifestyle than many think and try to strike a balance defines not only their lifestyle and beliefs but also between adhering to their religious roots and their attitude toward consumption. succeeding in secular society. Brands should focus on speaking to and connecting with the moderates Commonalities: Most Islamic movements revolve and liberals who are poised to greatly influence the around the five pillars of Islam: declaration of faith, future of the global economy. daily prayers, fasting during Ramadan, charity, and pilgrimage to Mecca. Together, these pillars Engaging the Muslim consumer manifest through good deeds and lead the faithful along the path to purity. In Islam, achieving and Several global brands have successfully appealed maintaining purity of the body, mind, and soul is to Muslim consumers without compromising their a fundamental tenet for Muslims and is achieved brand promise or global relevance. Below are some by adherence to the religious practices that align broad-stroke strategies culled from these examples. with the pillars of their faith. This search for purity thus becomes a way of life and transcends religious Communicate a higher purpose rites and greatly influences the choices Muslims make in their daily lives. The five pillars of Islam You don’t have to be a Muslim brand to appeal are thus integral to the Muslim lifestyle, but are to Muslim consumers. Any brand that can help practiced to varying degrees across geographies Muslims with their search for purity will succeed. and economies. While many consumers around the world have Differences: Adherence to and interpretation of started to pay attention to substance, purpose, imaan spans a wide spectrum: from conservative and a sense of greater good in a brand’s promise, and devout all the way to ultra-liberal. By many Muslims have long ascribed to and value this estimates, the religious conservatives are a minority philosophy. For example, halal meat, in addition in the world’s Muslim population. The biggest group to being prepared in compliance with Islamic today is moderate: religious but tolerant of other customs, is expected to be organic, free-range, faiths, in favor of women’s empowerment, ambi- ethically raised, and humanely slaughtered— tious, open-minded, and willing to compromise issues that have only recently become important on religious doctrines to get ahead in life. And to other consumers.2 Samar Birwadker View slide
  • above Image captions use the “caption text” style. below Image captions use the “caption text” style.The Body Shop. In spite of its British heritage, opportunity, create a strong proposition, and back Nokia introduced a phone loaded withthe personal care brand has enjoyed considerable up the brand promise through flawless execution. several applications that appealed tosuccess in the Middle East. Known for its ethical Due to the unique nature of the Muslim audience, Muslims, including an Islamic organizerbusiness practices, natural ingredients, and policies brands must understand their specific needs to and an app that lets people send SMSagainst animal testing, The Body Shop resonates develop compelling propositions. greeting cards for Ramadan.with Muslim consumers. Nestlé. The brand became the biggest halal foodHSBC. The bank was the first in the world to manufacturer in the world with $3 billion in salesoffer financial products targeted to the lifestyle annually.4 One of the most ubiquitous consumerand needs of Muslim consumers. When it began packaged goods (CPG) companies in the Middleto offer sharia (Islamic law) products such as East, Nestlé is not seen as an outsider like manymortgages in Malaysia, HSBC found that over other global brands in the region. What’s the key50 percent of its customers were non-Muslims; to Nestlé’s success? It was one of the first brandsthe products resonated with customers looking to make sizable investments in Islamic countries,for a safe and conservative approach to financial taking the time to understand the needs of Muslimsmanagement. The sharia products turned out to be and develop propositions around them. It evena necessity for the times: Islamic law allows banks launched the “Taste of Home” ad campaign,to charge fees but prohibits charging interest or targeted toward Muslim consumers. Most impor-investing in highly leveraged companies. tantly, Nestlé has been involved in the community, and has backed up its brand promise with productInvest in your brand promise development and operational changes—for example, 85 of the company’s 456 factories have beenBrands that want to appeal to Muslims will have certified halal with more on the way.to follow the same steps they take to engageany other consumer group: identify the market Landor Associates 3
  • Differentiation (Construct of different, distinctive, unique, innovative, and dynamic) Perceptions of Islam in the United States Given the significance of Muslim consumers to We found that Islam as a brand is one of the the future of global brands, marketers and brand most “differentiated” (a construct of forward- managers must ask themselves: How much do looking and momentum traits), but also has the we really know about the motivations, behaviors, lowest “knowledge” (measure of brand intimacy and attitudes of this consumer segment? beyond awareness) among consumers. Since brand valuation research is a part of my What is the key takeaway here? My interpretation role at Landor and because I was raised in a is that Islam is perceived as different only Muslim household, I was curious to find out what because U.S. consumers have little comprehen- would happen if we considered Islam as a brand sion of it. Which begs the question: Since and compared its “equity” and perceptions with consumers have little understanding of Islam, other major religions/denominations. We tapped are brands caught in a similar myopia? Are brands into the BrandAsset® Valuator (BAV), Y&R’s speaking to this important consumer segment in proprietary global brand valuation research tool an appropriate tone and manner? Are brands and looked at the 2010 U.S. study. In the United speaking to Muslims at all? States, BAV measures over 3,500 brands annually on 70 key measures of brand equity and imagery.  Some localization goes a long way to Muslims worldwide. Nike eventually issued an  apology and recalled the product, avoiding a boycott.  It isn’t always practical for global brands to make  highly differentiating changes for specific consumer Although not incited by a brand’s actions, in another  groups; and sometimes, overall brand relevance controversy, a newspaper in Denmark published can be compromised. But there are a few examples derogatory depictions of the prophet Muhammad of large global brands that have managed to and caused Muslim consumers around the world The chart reflects data based on consumer stay true to their brand promise while appealing to boycott Danish products, eroding an estimated perceptions recorded in the 2010 U.S. BAV to Muslims. $2.6 billion in exports.5 study. The data was collected in the 4th quarter of 2010 with sample sizes ranging Nokia. Established in Finland, Nokia feels equally Seize the opportunity from 600–675 respondents rating each at home in Europe as it does in Malaysia, Egypt, or religion/denomination. Argentina. How does the brand do it? The telecom Muslims are the fastest-growing consumer giant has localized to make its “Connecting people” segment in the world, and any global brand promise relevant across geographies. In the Middle ignoring them is missing out on a huge growth East and Africa, for example, in 2007 Nokia made opportunity. To engage, brand managers must first an effort to appeal to Muslims by introducing a work to understand Muslims’ beliefs, values, and phone loaded with a number of relevant applica- lifestyle—and they may be pleasantly surprised tions, including an Islamic organizer with alarms at the crossover potential for Muslim-directed for the five daily prayers, two Islamic e-books, products and services. A few simple strategies and an e-card application that lets people send will reap big rewards. ■ SMS greeting cards for Ramadan. Sharpen sensibilities Global brands should make a serious effort not to offend any particular consumer segment and be mindful that Muslims not only have great purchas- ing power, but also the power to boycott. The Council of American-Islamic Relations threatened a boycott of Nike products following the release of the company’s Air Bakin’ shoe, which had a flame design on the back that read Allah (Arabic for “God”), and was deeply offensive4 Samar Birwadker
  • above HSBC was the first bank inEndnotes the world to offer financial products targeted to the lifestyle and needs of Muslim consumers.1 The Goldman Sachs Global Economics Department, BRICs and Beyond, “Beyond the BRICs: A Look at the ‘Next 11’” (Chapter 13) right Known for its ethical business November 2007. practices, natural ingredients, and Ed. note: The “Next 11” countries are: policies against animal testing, Bangladesh, Egypt, Indonesia, Iran, Korea, The Body Shop resonates with Mexico, Nigeria, Pakistan, Philippines, Turkey, Muslim consumers. and Vietnam2 Reuters, “World Halal Standard Would Help $2 Trillion Industry” (29 October 2009).3 Pew Research, “The Future of the Global Muslim Population” (January 2011).4 Gatsiounis, Ioannis and Carla Power, “Meeting the Halal Test,” forbes.com (16 April 2007). members.forbes.com/global/2007/0416/038. html?partner=yahoomag (accessed 11 July 2011).5 Esposito, John L. and Dalia Mogahed, “Islam and the West: Clash or Coexistence?” from Who Speaks for Islam, Gallup (27 March 2008). gallup.com/poll/105700/islam-west-clash- coexistence.aspx (accessed 11 July 2011). Landor Associates 5
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