Halal Goes Global

16
Chapter 3 – DRIVERS OF HALAL FOOD AND BEVERAGE MARKETS
DRIVERS OF HALAL FOOD AND
BEVERAGE MARKETS
The halal market is a complex and fragmented jigsaw
puzzle, still fluid and expanding. Variables based on
cultural assumptions, habits and preferences, different
interpretations of Shariah law and the global nature
of food-product supply chains add to this complexity.
To understand the growth and evolution of the halal
market, it is useful to focus on forces that are driving
this market forward.
Consumer awareness
Consumer awareness in the halal food sector has already
had a significant impact on the development of the
market over the past decade. Lifestyle changes across
generations, all over the world, have been reflected
in changes in shopping, cooking and dietary habits.
Awareness of the relationship between diet and health, on
the one hand, and the need for processed convenience
foods, on the other, have given rise to new subsectors of
the food market that have their counterparts in the halal
market.
Online connectivity via social media and access to corporate
websites have narrowed the gap between the manufacturer’s
practices and the customer’s preferences. This trend will
inevitably continue as the use of social media expands. Major
brands recognize the importance of Muslim consumers
and their preferences, and are now seeing familiar patterns
of niche markets becoming an expanding subset of the
mainstream markets, especially as populations become
more culturally diverse.
A survey of the US Muslim consumer market found
that a vast majority of respondents (85%) felt ignored
by the major brands and wanted to see more products,
and even marketing campaigns, directed towards them.
At the same time, major US corporations such as
Walmart and Costco have said they see the rise of the
Muslim market following the same growth patterns as the
Afro-American or Hispanic markets in the United States,
i.e. moving from small niche to significant slice of the
mainstream 7 .
There is a trend towards ‘majority minority’ markets –
that is, most of a market is made up of minorities with
their own specific preferences. As food retailers and
others face narrowing profit margins, manufacturers and
marketers are driven to look for viable niches with good
growth potential – criteria that closely match the halal
market profiles.
‘There is a trend towards ‘majority minority’
markets – that is, most of a market is made
up of minorities with their own specific
preferences.’
Economics
Halal industries and the general halal market have become
established elements in the economic landscape over
the past decade. Various projects, from government
development programmes to corporate initiatives, have
raised the economic profile of halal products. With many
sectors reaching saturation, the emergence of the halal
industries has coincided with the widespread quest for
new growth markets.
The growth of Islamic finance has also paved the way
for halal to be more readily appreciated. The concept
of an Islamic economy, or a halal ecosystem, is being
used with increasing regularity. Recognition that the halal
food market does not exist in isolation, but forms part
of a new economic and commercial paradigm
that incorporates other sectors, adds to its appeal.
Convergence between sectors – such as food and
travel, for example – coupled with more detailed and
reliable data, all strengthen the growth of this market.
These developments generate economic activity, creating
new jobs and opportunities for entrepreneurs and driving
export growth. They also create opportunities for research,
training, conferences and trade expos.
Public-private initiatives on halal, such as those in Malaysia
and Thailand, have had a significant economic impact
– even in their early stages – by promoting the growth of
SMEs and boosting exports. Dubai’s project to become the
Capital of the Islamic Economy has triggered a range of halal