By Naheed Chowdhry, EMEA Marketing Head at The Hershey Company
With Emerging Markets back in the limelight for all the wrong reasons, there is growing concern around the global economy due to the likes of China-led headwinds.
Countries and Corporations alike scramble for cover and look for measures to offset this impact, as the $5trillion shareholder value wiped out in China alone is merely a sign of times to come.
The Biggest Losers!
Arguably one of the industries suffering most from the exposure will be the FMCG / CPG industry, where a number of well-known giants like Nestle, P&G and Unilever, have prided themselves on shifting their Turnover balances in favour of emerging markets.
Is there retribution? Could there be a savior source we haven’t fully comprehended yet?
Introducing ‘Nation H” – a population comparable with India and China, the global Muslim community of 1.8 billion people and growing might be the next Big Catch! With the “conventional” halal product opportunity valued at $2.3Trillion alone, there are 2 key directions for exponential development:
- The in-country opportunity for existing Muslim countries (and yes this is already being serviced – though more like a regulatory requirement than a true marketing asset )
- Going Green with ‘H’:
- The significant overlap of the halal opportunity with the “green” opportunity (eco-friendly/high quality pure ingredients) that will appeal to a wider global audience
- Servicing the rapid globalization of the Muslim community with a direct impact on sectors ranging from food, personal care, tourism and hospitality, etc. (and the common theme being the ‘H’ Word)
The ‘H’ Chain!
The conventional halal opportunity is multifold. It includes the entire value chain that delivers the food, from the seeds and fertilizers to the retail outlets selling it. Beyond food, it also spans Halal cosmetics, Apparel, Pharmaceuticals.
The ‘H’ Effect!
While the current largest halal opportunity is foods, this is primarily a high volume/ low margin arena that deals mainly with commodity products for daily use. Interestingly, the value growth may be driven out of the halal segment that can address the needs of a consumer base both Muslim and non-Muslim.
Getting Personal with ‘H’
The obvious opportunity is the halal cosmetics segment which has widespread appeal and may be the pilot case for tapping into the wider ‘H’ proposition under the “eco-friendly/ Nature’s BFF’ banner. Why? Because halal personal care products resonate at different levels – ranging from being animal friendly (no animal fat used in manufacturing) to Skin friendly (alcohol free) – with the underlying promise of high quality ingredients.
‘G’ & ‘H’ Path to Growth
This leads directly into the possibility for the halal and the “green opportunity” – natural, high quality, eco-friendly products – to be addressed under the same scope. Over the past decade, green segments are growing across all industries and taking share from conventional markets. Though off small bases, the growth rates are significant. And they’re higher priced for their quality which a growing number of consumers are willing and able to pay.
Ending with the ‘H’
The way to best tap the halal market may be to adopt a multi-pronged approach: The larger opportunity may lie in merging the green and halal potential. With many FMCG giants already gearing up towards a sustainable living / greener approach, the halal opportunity may be more rapidly available than we think!
What do you think? I would love to hear your comments on the above.