Halal Perspectives – Understanding the Muslim Customer

The Halal Journal’s Research Director, Hajj Abdalhamid Evans presentation at the 3rd International Food Marketing Forum held in Dubai on 21-23 February.

By Hajj Abdalhamid Evans, http://www.halaljournal.com
Posted, May 15, 2005

It is one of the universal truths of business that one of the most important keys to success is an accurate understanding of the customer. Whatever you produce, trade or offer, without the customer there is no business.

I find it highly significant that this topic, ‘Understanding the Muslim Customer’ should be a topic of interest at the Middle Eastern Food Marketing Forum this year. I am certain that ten years ago – or even five – this topic would not be on the table. So what has changed? The Muslims have been eating halal food for more than one thousand four hundred years, so why is this now a topic?

Our perception of this matter at The Halal Journal is that we are at the cusp of a new market paradigm, the birth of a global halal market. We are of the opinion that the Halal represents an emerging market force that will, over the next decade or two, exert a powerful influence on the food market in a manner that has not yet been fully anticipated.

Profiling the Muslim Customer

Who are the Muslim customers? Where do they live? What do they buy? How much do they spend? How do they make their decisions?

The Muslim customers are of course high-income individuals with large families from the Arabian peninsula. They are also middle-income Turkish or Egyptian families, businessmen in the modern cities of China, Indian traders in Johannesburg or Durban, third generation Pakistani lawyers in the UK, street-vendors from Tangiers in Paris, Bosnians living in Amsterdam, Lebanese in Australia, black Americans in New York and Washington, middle-class European families.

The Muslim customer is the most complex and diverse market demographic imaginable. The Muslim customer lives all over the world, straddling all income brackets. The Muslim customer eats the widest range of foods from curries to kebabs, pizza to haute cuisine, dim sum to burgers. They cook at home for huge family gatherings, and eat out in 5-star restaurants, hawker’s stalls, bistro’s and fast food chains. The Muslim customer is one person out of four, and frankly, could be anyone at all, from anywhere in the world.

And yet, this diverse, amorphous and almost indefinable group of people are bound together by the strongest of bonds, by the command of their Creator:

“Oh mankind! Eat from the earth that which is halal (lawful) and (tayyib) wholesome.”

This means that the food must be
a. Permitted, i.e. not pig, blood, carrion, having claws or talons, killed by strangulation, a violent blow or a fall, gored or killed by wild animals
b. If it is animal, it must be slaughtered according to specific parameters of Islamic law
c. Be it animal, vegetable, fruit, grain or seafood, it must be ‘tayyib’, i.e. good, wholesome, healthy, untainted during the stages of processing, packaging, storage, transportation or transaction.

These parameters define the eating habits and by extension, the purchasing preferences of two billion people around the world. These parameters are, essentially, non-negotiable; they are unmoved by fad or fashion, they are not subject to age, income or geography, and are all the more powerful by not being enforced. They are the parameters of a people who choose, freely, to eat what is lawful.

A Powerful Market Sector

Commercially, the Muslim consumers constitute the core of what is perhaps the largest market sector in the food industry. The numbers are of course impressive, but the growth rates are more so. Europe’s Muslim population of around 25 million increased at a rate of 140% over the last 10 years, America’s by 25%, Australia’s by 250%. Asia’s one billion Muslims increased by 12% over the same period, and a quarter of them are in the high growth-engine areas of India and China. This is not a market to ignore.

However, these already impressive figures are augmented by several factors which stem from the fact that it is not just the Muslims who purchase and consume halal foods. Significant, and so far unquantified numbers of non-Muslims eat halal food, partly by coincidence, but increasingly by choice. Food producers from all parts of the world have made the conscious decision to ‘go halal’ with their product range. And why not? A huge sector of the market insists on it, and the rest are all happy to eat it as well.

Meat producers in Australia are increasing the percentage of halal export produce. 80% of all lamb exported from New Zealand is halal. If you travel to Cape Town, you will notice that all chicken on sale is halal. In the UK, there are approximately three million Muslims, and yet, according to Dr Salim of the UK Food Safety Authority, there are six million consumers of halal meat. A recent delegation from Japan to Brazil to purchase chickens for import, insisted on halal. Increasingly, European Supermarkets have halal sections.

What must be kept in mind here is that Halal does not simply refer to no pork or alcohol; it does not either simply refer to meat, but, in this context to food in general.

Halal – a wide Market Spectrum

Furthermore, Halal encompasses several market forces and incorporates them within its existing parameters, and significantly, within the scope of its immediately approaching growth areas. Leaving aside, for a moment, the matter of religion, the current growth sectors of the food market include the following

. Healthy food. Arguably the fastest growing sector of the food market. In the US, for example, Wholefoods, a one store start-up in the 70’s is now a 3.7 billion dollar company with 26,000 employees. It recorded an average growth over the last 5 years of 19%, compared with the 2.5% of the general grocery market.
. Ethnic Foods. According to Algodal, the leading ethnic food consultants in Paris, ethnic food sales in Europe are doubling every 4 years, with Southern Europe about 5 years behind Northern Europe. This phenomenon cuts across income levels. It was urban, and is now provincial; it was the single portion yuppie market, but now the yuppie has a family; on average 3.4 ethnic meals per person are consumed weekly; 1 out of every 2 new restaurants in Paris offers ethnic food.
. Assimilation. Foreign foods become assimilated and local tastes change, encouraged by global tourism and reverse colonisation. Couscous is now seen as a French dish; curry is the number one take away meal in the UK; kebabs are a typical German staple;
. Ethical & Environmental. Supermarkets are increasingly offering organic label foods, environmentally friendly and ‘Fair Trade’ products, reflecting the consumers concerns with these issues. Vegetarian is often as much an animal welfare choice as health issue, and today’s consumer is an increasingly aware consumer.
. Safety Issues. Mad Cow Disease and Avian Flu have had a greater impact on the meat and poultry markets recently than any other force, fuelling the already hot debates about animal welfare on one hand, and the politics of food on the other. One suspected case, let alone an outbreak, can have a dramatic impact on export earnings.

These issues fall within the broader parameters of the Halal; there is a natural zone of overlap. Halal incorporates the healthy, the ethnic, the environmentally friendly, the ethical; halal has clearly become assimilated into all cultures around the world from Washington to Beijing.

Safety First

However, it is on the primary issue of safety that we may well see the greatest impact of Halal on the global meat market. The devastating economic impact of Mad Cow Disease has revealed a disturbing element of the industrialisation of the global meat market, a market in which it has become increasingly difficult to determine what a product actually contains, or where it comes from. As a senior executive from one of the largest animal feed producers in Europe recently commented, BSE is an economic disease. The desire to find the cheapest way to produce the biggest animals led, inevitably, to the inclusion of animal proteins in the feed, and the cheapest source of animal protein is the waste, including brain and central nervous system tissue, from the slaughterhouse floor.

This issue alone indicates why, in the relatively near future, a halal standard will prove to be superior to current food controls such as HACCP. Halal is the only control methodology which takes into account the origin and composition of the animal feed.

In Malaysia, for example, with the longest-established Government-issued Halal Certification in the world, we are seeing the emergence of Halal Industrial Food Parks, reserved for Halal food producers and related businesses. These initiatives have in turn led to the emergence of Halal logistics providers such as Halal cold storage and transportation companies offering Halal supply chain control management, and most recently to the creation of a Halal Free Trade Zone at the Port of Tanjung Pelapas in Johor Bahru.

Other initiatives include a college for training in Halal food management, standards and certification, and Halal auditing to verify halal compliance from the farm to the plate.

I mentioned previously that although meat is the market leader in terms of halal, it is not just a matter of meat. It is now commonplace to see a Halal logo on other food items – milk, bread, juices and soft drinks, sauces, prepared meals etc. The Halal logo has become a symbol of quality assurance as well as religious compliance, and this is now spreading to toiletries, cosmetics and even starting to touch on pharmaceutical and medicinal products as well.

A New Market Identifier

Halal represents a very large and rapidly expanding market segment. More importantly, it is a new force of market organisation and identification. Its core fundamentals are not going to change; they are going to expand and steadily incorporate many of the market trends and indicators that I have previously mentioned. Some form of global Halal standard is inevitable, and we anticipate that it will be driven into existence by the market, not the politicians. Once established, it will be a very powerful market force.

Islam is the fastest growing religion on earth, both by birth and adoption. It is estimated that by 2010, the Muslim population will exceed 3 billion. Current estimates as to the value of the global halal food market, based on how much the Muslims spend per capita per diem, range from 150 to 500 billion dollars annually. These figures of course do not take into account the growing numbers of non-Muslims who eat halal food. Our assessment is that the market is actually too large to measure, and it is growing all the time.

In our view, halal represents a new market paradigm that goes far beyond food. It incorporates an entire realm of goods and services. Halal ultimately represents an market for halal goods and services produced in a halal way, sold in halal arenas according to halal transactions, using halal currencies.

Halal food is the tip of the iceberg of the impact of Islam on commerce, a convergence that will form one of the defining forces of the coming decades.

Reproduced with Permission.
First appeared in Halal Journal (http://www.halaljournal.com), February 2005


About this entry