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Sultan Mosque in Kampong Glam is one of Singapore’s iconic Malay/Muslim facilities. It is surrounded by shops catering to Muslim needs including clothing, pharmaceuticals, books, food and travel. (Photo: Norazreen Abd Haris)
From faith to fortune
With Islam set to be the world’s largest religion, a segment of Muslim consumers is rising. Demand for Muslim-friendly products is soaring, and Singapore is well placed to capitalise on the world’s biggest consumer trend of the next century — starting now.
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By: Norazreen binti Abd Haris
Christianity’s lead as the largest religion in the world may end in the next century, based on a study by Pew Research Center in 2015. The number of Muslims is expected to increase by 70% from 1.8 billion in 2015 to 3 billion by 2060, providing a major global business opportunity.
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The potential for growth in the Muslim segment is down to demographics. With Muslims having the lowest mean age, at 24 years old, their number is expected to increase further once this group starts to raise families.
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This growing market is not simply more of the same, because among Muslim consumers, there is distinction among types of food, products and services which are “halal" (permitted) and “haram” (forbidden), guided by Sharia Law – a way of life Muslims abide by.
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With that, the demand for halal and Muslim-friendly products is increasing.
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In the latest State of the Global Islamic Economy Report by Dubai Islamic Economy Development Center, in conjunction with Thomson Reuters, an estimated US$1,000 was spent on average by each Muslim on Muslim-friendly lifestyle goods and services in 2017. The expenditure amounted to about US$2.1 trillion, with food and beverages (F&B) accounting for more than half.
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This segment is growing fast and Muslims are now a majority in over 40 countries. In line with this, industry players increasingly cater to their needs.
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The fourth London Muslim Shopping Festival in April prides itself as being the biggest halal event in the United Kingdom. Mainstream exhibitors such as Sainsbury’s, Harrods and Selfridges were present at the annual event.
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In the United States, companies are also gearing up to embrace the Muslim market. I Heart Halal, a festival promoting a permissible lifestyle according to Islam, was held in Chicago for the first time last year.
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Tourism is also likely to boost revenue for Muslim-friendly businesses. Countries under the Association of Southeast Asian Nations is expected to welcome over 18 million Muslim visitors by 2020, based on Mastercard-CrescentRating Global Muslim Travel Index (GMTI) 2018.
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Closer to Singapore, Australia’s Cocos Islands are gearing up to be a Muslim-friendly attraction within the next two years, reported Berita Mediacorp.
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Singapore is even more promising. With its status as the top travel destination for non-Organisation of Islamic Cooperation countries, based on GMTI 2018, it offers greater prospects for businesses seeking to attract Muslim consumers.
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Besides the constant flow of visitors, more than 400,000 Muslim residents are aged 15 years and above, based on the latest census in 2010. So, demand for Muslim-friendly goods is constant.
Still, the Muslim market remains largely untouched, except for the F&B sector which is flooded thanks to low barriers to entry, said Azrulnizam Shah Sohaimi, executive director of the Singapore Malay Chamber of Commerce and Industry.
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The ease of renting a space, acquiring supplies and licenses makes the F&B sector an attractive entry point for entrepreneurs, according to the Restaurants Association of Singapore.
However, by looking at F&B trades exclusively, it is easy to miss the bigger picture of the larger Muslim market.
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“I would say that the F&B sector is a little bit congested but there are other opportunities opening up, such as all the other subcategories of halal, like tourism, logistics and pharmaceuticals,” says Azrulnizam.
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Given the rapid growth and significant amount spent by Muslims, businesses cannot ignore them any longer if they want to stay relevant. Instead, companies can get a head start against competitors by understanding current market conditions and Muslims’ consumer needs.
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The rise of middle-class Muslims
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A shift in Muslims’ identity also means businesses must adapt to target this segment. In the 1970s, the Malay community, made up of mostly Muslims, created a separate Islamic identity among middle-class Singaporeans to combat Westernisation, said Dr Norshahril Saat, a fellow at the Institute of Southeast Asian Studies.
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This Islamic identity, however, closely resembles the Arabic way of life. Today, people tend to confuse between being a good Muslim and being Arabised, said Dr Norshahril. As such, many Muslims in Singapore and beyond choose to adopt Arab culture to connect with their Islamic identity.
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For example, hundreds of local Muslims make an annual pilgrimage to Mecca. When they return, it is easy to identify them among the crowd gathered at Singapore’s Changi Airport. Unlike their family and friends who are dressed casually in t-shirts and pants, these returning pilgrims are decked mostly in white, loose fitting jubahs and abayas.
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Although these outfits are not traditional Malay costumes, they are worn by middle-income groups to express their Islamic identity as they connect to their religious roots.
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“I would say there is a gradual rise in Arabisation because it started off with the middle-class… So, it has a correlation to the rise of the middle-class in Singapore,” says Dr Norshahril.
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In other words, growing wealth is strongly associated with a closer embrace of a Muslim and Arab way of life. Middle-class Muslims are also the ones calling for more variety of Muslim-centric products, ranging from travel to clothing, cosmetics and pharmaceuticals.
“The F&B sector is a little bit congested but there are other opportunities opening up, such as all the other subcategories of halal, like tourism, logistics and pharmaceuticals.”
— Azrulnizam Shah Sohaimi, executive director of the Singapore Malay Chamber of Commerce and Industry
Last year, A Doing Business listing by The World Bank ranked Singapore third for starting a business and second for ease of doing it, making the Lion City one of the most ideal locations for new businesses looking to capture the Muslim segment.
US$1.3 trillion was spent on food and drinks by Muslims globally. It is a crucial sector for Muslim consumers, given their religious dietary restrictions which make it compulsory for them to consume only halal food.
In the pages that follow, the team has pulled together a collection of feature articles that further explain Singapore’s Muslim market and provide readers with a foundational understanding of Muslim-friendly products. These stories are catered to entrepreneurs seeking to tap into the growing Muslim segment.