Yahoo Finance The world’s fastest-growing population is also a massively untapped food and fashion market
Imagine a group of more than 1 billion consumers who are underserved in the conventional marketplace yet eager to purchase goods that suit their particular lifestyle. Wouldn’t you want in?
A report by Euromonitor estimates that Muslims will make up more than a quarter of the world’s population by 2030. According to The Economist, the global Islamic market was worth over $3.6 trillion in 2013, and the market is projected to be worth over $5 trillion by 2020.
The global Muslim population has diverse tastes and interests, but it also has a number of religious requirements that color its purchases. The principles of Islamic law inform the purchasing decisions of Muslims in many areas, but these requirements are not always directly met in the global marketplace. And Muslims around the world are waiting for more suppliers to step up.
Islam is meant to be a way of life, not just a series of practices and traditions, so the governing rules permeate every moment of a Muslim’s day, from food to clothing, investments to insurance. While there is global variability in how strictly you adhere to these systems, many Muslims such as myself must ensure that we as consumers only buy what is considered halal (permissible) and not haram (forbidden).
Supply has simply not caught up with demand for Muslim-friendly products. By looking more closely at markets like food and fashion, we can bring the huge opportunity into focus and highlight the growth potential for the world’s Islamic populace.
Halal food
The halal food market is projected to be worth $1.6 trillion by 2018. This sector is also estimated to be growing faster than the conventional food market, and could exceed 17% of the world food market by 2018.
Observant Muslims are only allowed to consume meat that has been slaughtered according to the prescribed halal method. This means that Muslims must seek out products that are safe to consume. Often, this means searching for the familiar crescent moon and star symbol designating a product halal.
Halal procedures include requirements that the butcher’s knife must be sharp, the neck of the animal should not be broken or completely cut off, at least three of the four veins in the neck must be cut during the slaughtering process, and there should be no contamination with non-halal meat. And it goes beyond buying correctly slaughtered meat: This also means that something as seemingly innocuous as a gummy bear may not be permissible if the gelatine used in the gum is made from animal products that are not halal.
The halal food market is projected to be worth $1.6 trillion by 2018. Some Muslims believe that kosher-certified food can be substituted for halal products because of similarities in the slaughtering process; as there are many more kosher offerings than halal, it’s not uncommon to sometimes opt for kosher products instead. However, this is not ideal, because the two standards do differ, and kosher is therefore not a perfect substitute. (For example, a Muslim must slaughter the animal for the meat to be halal, and a specific prayer must be said at the time of slaughter.)
Countries with high Muslim populations cannot always rear all the meat that they want to eat because of geographic reasons or because their populations outnumber the size of their animal husbandry industry. These countries must import a lot of halal meat from other nations, which provides a huge opportunity for non-Muslim-majority countries to meet this demand. For example, Brazil, America, Australia, Pakistan, India, and Ethiopia all export halal meat to Dubai.
Because of the high Muslim population in the region, southeast Asia is also a general hub for Islamic products. Japan is beginning to get in on the halal action with food producers applying for halal certification from religious bodies, and China is on this path, too. Japan in particular is hoping to tap into external markets including Singapore, which has a Muslim population of around 15%.
Ogilvy Noor, an Islamic branding company, advises that apart from halal meat requirements, manufacturers should also look at offering organic, free-range, and ethical products to Muslim consumers. The organic market intersects with the halal market, so there are opportunities for natural growth in this area. The US company Whole Earth Meats is tapping this market already, with products advertised as “local, grass-fed, free-range, organic, humanely-raised, family farmed, Halal meats and poultry.”
The market appeal of these products is potentially broader than just religious adherents. Because of the perception that halal food is subject to stricter controls, halal food is sometimes preferred by non-Muslim consumers, too. For example, animals slaughtered in a halal manner basically undergo two health checks instead of one: the usual regulatory health check of its country of origin, as well as a check by the halal certification authority. The method of slaughter, in which the blood is drained from the animal, is also thought by some to be healthier.
Islamic Fashion
According to a Thomson Reuters report, around $266 billion was spent on clothing and footwear by Muslim consumers in 2013. This amounts to around 12% of total global expenditure on clothing (a 10% increase from 2012). The market for Muslim fashion is projected to account for over 14% of the global fashion market by 2019.
While the market for e-commerce in this arena is still relatively small, it is also growing faster than conventional fashion sales online; it expanded at a rate of 25.4% in 2013, as compared to 5.8% growth in conventional fashion-related e-commerce.
Around $266 billion was spent on clothing and footwear by Muslim consumers in 2013. Demographics also play a role in this burgeoning market. While the average age of citizens is around 30 in majority-Muslim countries, Europe and the US has an average population age of 44. Because the purchasing power of young consumers should grow over time, the market for Muslim goods will thrive for years to come.
In the context of Islamic law, requirements for dress are more modest than much of traditional fashion. Men should be covered from navel to knee, and women should cover all that is apparent, which generally entails wearing loose-fitting clothing on all visible skin aside from the face, and often covering the hair as well. There is much debate around whether the full-face covering is obligatory or merely recommended. The word hijab has come to refer to headscarfs generally, but its literal translation from Arabic is closer to “covering” or “curtain.” Scholars debating the translation and interpretation of the Qur’anic injunction have not always agreed on how much women have to cover.
This means there is no universal wardrobe for a Muslim woman. Muslim women wear colorful salwaar kameez in India, abayas in Dubai, long shirts and coats in Turkey, and Western clothing in South Africa, the US, and the UK with modifications for modesty.
A few years ago, there were limited options for modest dress, but now major fashion houses and boutique brands are fusing fashion with modesty. For example, Dolce & Gabbana has launched an abaya and hijab line, and in countries like Dubai, the range of expensive abayas is astonishing; flowing designs, Swarovski-embellished, and produced in an assortment of fabrics, these abayas are not your average black cloak. Louella, the start-up modest fashion line founded by the US Olympic fencer Ibtihaj Muhammad is one of the exciting new companies operating in this space.
There is also potential for growth in the cosmetics industry, where food and fashion collide. As women unintentionally consume some of their lipstick over the course of the day, it must be halal because some lipsticks contain animal fat. Some Muslims stick to producers who go vegan, but again, that really limits the range of beauty products. The halal cosmetics industry is a largely untouched market.
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While the market for Muslim-friendly products has been developing over the years, there is still a lot of room for growth as the Muslim consumer base continues to increase. Opportunities for companies to enter this market abound, regardless of the organization’s location or religious persuasion.
You can follow Aneesa on Twitter at @aneesabodiat. Learn how to write for Quartz Ideas. We welcome your comments at ideas@qz.com.
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