Halal Certification an International Marketing Issues

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Halal Certification: an international marketing issues and challenges by Shahidan Shafie1 Prof. Dr. Md Nor Othman2 Faculty of Business & Accountancy Universiti Malaya, Kuala Lumpur, Malaysia Abstract Marketing of products and services in the Muslim countries presents a very challenging task to multinational companies (MNC) due to the difference in political, economy and socio-cultural aspects. At the same time, MNC could not “avoid” targeting Muslim countries as their source of expansion as these countries represent almost 20% of the world’s population. Furthermore, this figure is expected to increase to 30% by 2025. One of the most important concepts in Islam is the concept of halal, which means “permissible.” Halal covers the aspects of slaughtering, storage, display, preparation, hygiene and sanitation. It covers food as well as non-food category of products. Given the speed of trade globalization, the advancement in science and technology, and the ongoing initiatives to simplify manufacturing processes, it is essential that the halal concept be fully understood by marketers. This paper discusses the marketing challenges in dealing with the halal issue. It makes reference to Malaysia’s halal certification policy and procedure as the country has set itself to become the major player in providing halal products and services. This complements well with Malaysia’s role as the Chairman of the 57-nation Organization of Islamic Conference (OIC) and its vision to become the global halal hub

Track: Contact: Address:

13. International marketing and service Shahidan Shafie 1829, Ptg Hj Hassan, 13220 K.Batas, SPU. Penang, MALAYSIA Tel: 6012 4097449 E-mail: shahidanshafie@yahoo.com

1 2

Shahidan Shafie is a PhD candidate at the Universiti Malaya, Kuala Lumpur, Malaysia Md Nor Othman is a Professor of Marketing and the Dean of Faculty of Business & Accountancy, Universiti Malaya, Kuala Lumpur

Halal Certification: an international marketing issues and challenges 1.0 INTRODUCTION

In the Muslim majority, Malaysia, the concept of halal is an absolute key to consumption. Muslim consumers nowadays are faced with a broad selection of products and services. On top of that, each product category offers many different brands – either locally named or internationally recognized ones. Some of the local brands appear to capture their own niches by projecting themselves as “Islamic” brands via their creative packaging and labeling works. This also indirectly signals to their primary target – the Muslim consumers - the halal status of their products. On the service side, similar efforts are being done in the banking and in the insurance sectors.

The above scenario describes the situation faced by the Malaysian consumers as they go through their daily chores in consumer goods purchasing. There are many choices of brands and each brand is fighting each other for shelf space in order to get the attention of their target consumers.

Besides the products and the brands available in the retail outlets, the Malaysian consumers are also offered various direct selling brand alternatives such as those in the personal care and cosmetic categories. Among the direct selling companies offering such products include international names such as Amway, Avon, Cosway and Nutrimetics. The flux of international brands into the country is thought to be the result of a widespread use of the Internet and the e-commerce facility by the Malaysian consumers.

Manufacturers and marketers use halal certification and logo as a way to inform and to reassure their target consumers that their products are halal and shariah-compliant. In general, the Muslim consumers in Malaysia look for the authentic halal certification issued by the Malaysia’s Department of Islamic Development (JAKIM) which is under the purview of the Ministry in the Prime Minister’s Department. This certification


granted the companies the use of halal logo for printing on their...
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