Competing in Global Markets Assignment No: 1

Group No: 6 Date of Submission: 18-JUN-18

1. Is the Halal revolution making the world a ‘flat’ place for consuming food? Does taste
surpass cultural and institutional barriers?
“Halal”, an Arabic term, literally translates to “permissible” and observes Islamic rules dictating
activities (not just food consumption) that are permissible/ forbidden. According to Euromonitor
International, the sector has predicted CAGR of 5%. The research also mentions that growth in the
sector is driven by the UAE and Indonesia and a global market of US$55bn halal packaged food and
drinks is expected over next 5 years.
Key market drivers that contributed to this growth of the halal food market are rise in Muslim
population at higher rate, Halal as symbol of healthy food and increasing sales of halal through
several channels (may it be large retail chains by players like Hypercity, Godrej, etc. or Restaurants,
including global players like McDonalds, adopting halal as their operating procedure and being
sensitive to their customer’s demand for Halal food.
As business choose halal its operating procedure, it has to take care of both Muslim and non-Muslim
customers differently. Say for example, Traditional French cuisine ‘foie gras’ normally has white wine-
based sauce but since wine is ‘haram’(forbidden) in Islam and so cannot be recreated with Halal
meat in a complete sense. Thus, even if popularity of Halal food is increasing, it fails to do justice in
some situation like one mentioned above. Halal food industry is still younger and only time will tell
how it would be able to make a place for itself in Muslim-minority nation. Although China has shown
some growth prospect on these lines, it can be attributed to high Chinese population.
Taste of a product does help in crossing borders and being loved globally as in the case of Corona,
but we should also think about the ways consumption takes place and how provider are subjected to
make customization to offerings (the one like Halal food) when they perform on a global podium.

2. If the Halal market were to grow globally, who should be the target audience?
Halal concept commonly concerns customers practising Islam and as 70% of all muslims worldwide
follow Halal principles, Muslim diaspora can act as sustainable beachhead to enter new markets and
then expand on benefits that Halal product have to offer to other segment as well.
Last few years health segment has witnessed high demand in global market and this is where Halal
products can tap into by offering more healthy options (backed by researchers) to the Non-Muslim
population like vegans or vegetarians or the people having specific by-product allergies, and the
increase in demand for hormone free food. Muslims currently represent 23% of the global
population or about 1.8 billion customers with an annual growth rate of 3%. However, the
distribution of Muslims is pretty much skewed globally, like only 0.1% in North America, and even
lesser in Australia and Russia. So, for the Halal segment to grow globally the Non-Muslim sector,
mostly one seeking healthy options, should also be targeted using Muslim diaspora as a viable
beachhead in Muslim-populated economies.

References:
https://www.businesswire.com/news/home/20170815005842/en/Halal-Food-Market---Top-
3-Drivers
https://timesofindia.indiatimes.com/Science-of-meat/articleshow/11672654.cms
https://www.theglobeandmail.com/life/halal-restaurants-spark-a-new-kind-of-french-
revolution/article1376074/
https://extension.psu.edu/marketing-to-ethnic-segments-halal-products
http://ijecm.co.uk/wp-content/uploads/2015/03/3320.pdf
https://www.sciencedirect.com/science/article/pii/S1877042814011446