Innovative Muslim Market

Brands & Opportunity Gap

1

Rafi-uddin ShikohE: rafishikoh@dinarstandard.comW: advisory.dinarstandard.com

Presented at:

By:

Muslim Markets* ¼ of the world Barely any Global Innovation/Brands?

Most Innovative Companies & Respected Global Brands

Companies built on trust and admiration

*All logos are sole properties of respective organizations

Source: Reputation Institute

2© DinarStandard 2005-2011

OIC* Economies:US$ 7.6 trillion, ‘09 GDP

Growing sectors:• Transportation• Food & Agriculture• IT\ Telekom• Healthcare/ Pharma• others

MUSLIM LIFESTYLE MARKET:US$ 2 trillion+ ‘Halal’ consumer market

Growing segments:• Food, • Fashion, • Recreation• Travel• Education, • Health, • Other

Growing segments:• Investment Banks/PE Firms, • VC Firms• Retail Banks• Insurance Companies• Other

ISLAMIC FINANCEUS$ 1 trillion, 15-20% growth/year

Emerging Muslim Market Innovations/ Brands

3 Key Opportunity Areas

*57 OIC (Organization of Islamic Conference) member countries3© DinarStandard 2005-2011

Two Objectives today

1

2

Share Examples of Innovative

Muslim Market Brands

Strategies for

Big Thinking - Global Leadership

Innovative Muslim Market Brands & Opportunity Gap

4

Muslim Market Innovations/ Brands

First: Innovation Defined

• Implementing new ideas in a

commercially viable way.

• Types of Innovation:

• Product: Ebay

• Process: Dell

• B-Model: iPhone - iTune

• Cust.Service: Zappos

• Positioning: Nike

5*All logos are sole properties of respective organizations© DinarStandard 2005-2011

OIC* Economies: Innovative Brands

Leading & Innovative Examples

*57 OIC (Organization of Islamic Conference) member countries

Consumer Brands of the Top 100 Companies of the OIC (from DinarStandard‟s DS100 Ranking)

Select Innovative Brands

Finance:

Transportation

Food:

Education:

Hospitality:

Media:

*All logos are sole properties of respective organizations 6© DinarStandard 2005-2011

Muslim Lifestyle Market: Innovative Brands

Food Sector Examples

Others:

Bateel: A Gourmet Date Experience

Offers more than 20 varieties of high quality dates

and chocolate. Recently launched a series of

Café‟s across its main markets.

HQ: Riyadh, Saudi Arabia ; Employees: 550+

Locations: 25+ outlets: including Dubai, Riyadh,

Amman, Riyadh, Mumbai, Delhi, Kuala Lumpur,

London.

Image source: Bateel website;

*All logos are sole properties of respective organizations7© DinarStandard 2005-2011

Muslim Lifestyle Market: Innovative Brands

Fashion Sector Examples

Others:

SHUKR: Putting faith into fashion

Launched 2001: “contemporary modest clothing”

for a new generation of Muslims living in the

West. Prides having non-Muslim loyal customers.

“Aspires to be a model Islamic business…fair

trade, ethical labor practices, pursue a path of

perfection by producing clothing of the highest

standards, and avoiding interest-based financing.

.

Bahrain‟s Al-Gassra

Image source: Shukr website

*All logos are sole properties of respective organizations8© DinarStandard 2005-2011

Muslim Lifestyle Market: Innovative Brands

Travel & Hospitality Examples

Others:

Tamani Hotels & Resorts, Dubai

“Dedicated Ladies floor, Is alcohol free,

serves halal food, patron of Islamic art, and

donates a %age of profits to charities.”

A hospitality and leisure management division of KM

Properties, which is the real estate development

division of Dubai based KM Holding. Had announced a

US $2.3 billion Islamic-compliant real estate fund.

Image source: Tamani website

*All logos are sole properties of respective organizations9© DinarStandard 2005-2011

Islamic Finance: Innovative Brands

Leading Examples

Others:

Al Baraka Banking Group (Bahrain) is a leading

international Islamic bank offering retail, corporate /

investment banking and treasury services in accordance

with the principles of the Islamic Shari'a.

Vision: We believe society needs a fair and equitable financial

system: one which rewards effort and contributes to the

development of the community.

Image source: AlBaraka website

*All logos are sole properties of respective organizations10© DinarStandard 2005-2011

Only fraction of demand

being met*.

Each sector represents

various consumer facing

and B2B subsectors. E.g.

Halal Food Sector in

infancy across all sub-

sectors.

• Islamic Finance: $1 trillion

in total assets, growing at

15-20% annually. Yet--still

in its infancy and mostly

B2B.

* Based on existing Halal services relative to related product category consumption today

** DinarStandard 2008 estimate based on related conventional product category current spend

Media

Online

Services

Education

Hospitality

Other

Pharma

Retail

Consumer

Goods

Halal Food

Retail

Islamic

Finance

Fashion

Tourism

Global

Audience

Faith driven

Global Muslim

Consumer Base

1.6 Billion ppn.

**US$1.8 trillion+

spend

© DinarStandard

Muslim Lifestyle Market/ Islamic Finance

HUGE Opportunity Gap.

11© DinarStandard 2005-2011

OIC* Market Brands

HUGE Opportunity Gap.

Increased connectivity and growth within the 57 OIC (Organization of Islamic Conference) member countries (2009 GDP est. $7.7 trillion, 12.8% of the Global GDP.)

Yet– barely any reputable global brands and innovations.

12© DinarStandard 2005-2011

Two Objectives today

1

2

Share Examples of Innovative

Muslim Market Brands

Strategies for

Big Thinking - Global Leadership

Innovative Muslim Market Brands & Opportunity Gap

Global value

proposition with

Islamic values

inherent

Muslim Lifestyle

market optimized

Global business

solutions with

developmental

impact

13© DinarStandard 2005-2011

"Innovation is capable of being presented as a

discipline, capable of being learned, capable

of being practiced.

Entrepreneurs need to search purposefully

for the sources of innovation, the changes

and their symptoms that indicate

opportunities for successful innovation."

Mr. Peter Druckers, Innovation &

Entrepreneurship

Innovation Strategy Best Practices are well defined

So, we should learn from the best and invest

14© DinarStandard 2005-2011

...but, hasn’t exactly translated to the OIC environment

Industry clusters have been developed and

existed for years.

Global consulting firms have been advising

OIC companies on these strategies.

No Silicon Valley as yet,

No Google as yet,

No Values driven truly global “Islamic Brand”

15© DinarStandard 2005-2011

Leading Global

Brands

50 Most Innovative

Global Companies

Top 100+

Companies of the

Muslim World

a) A corporate culture that fosters “Fear of

Failure” at all levels

a) Small Thinking led by executive leadership

b) A corporate culture that discourages “Critical

Thinking” at all levels

1. Relative “Chronic” gaps in the OIC markets’ innovation culture

2. Major gaps in branding & marketing approach

VS

Top 100+

Companies of the

Muslim World

VS

We compared and looked closely and found*:

So what‟s missing?

*Based on DinarStandard research/ analysis

a) Disingenuous brand soul/ identity

b) Relative lack of marketing investment

16© DinarStandard 2005-2011

2. „Rehabilitate‟ an Innovation

culture

Critical to realize full potential of Muslim market opportunities

Solution: 3 Core Areas to address

3. Develop competitive, marketing

& innovation practices

1. Products/Brands with unique soul: (core values/ purpose)

Challenges

Unique to

the Muslim

markets

*Based on DinarStandard analysis 17© DinarStandard 2005-2011

2. „Rehabilitate‟ an Innovation

culture

Critical to realize full potential of Muslim market opportunities

Solution: 3 Core Areas to address

3. Develop competitive, marketing

& innovation practices

1. Products/Brands with unique soul: (core values/ purpose)

*Based on DinarStandard analysis 18

Focus on 3 Only - You can create good

follower brands

Without 1 & 2 - You cannot truly

develop sustainable business

icons.

© DinarStandard 2005-2011

IFI’s Operational Manifestation Disclo

sure

& G

ove

rnan

ce as a Me

ans o

f Acco

un

tability

Mandatory

• Screening of investments

• Earnings prohibited by Shari‟a

• Responsible dealings with clients

• Employees

• Zakah

Operations(employees, vendors, etc)

Financial

mobilization Religious (Form & Substance in all

operations)

Recommended

• Qard Hasan

• Environmental considerations

• Screening clients and contractors (add. criteria)

• Industry-wise investment quotas

• Social impact based investment quotas

• Par excellence customer service

• Micro/ small sized biz social savings and investments

• Employee welfare (extension)

• Charitable activities

Social Responsibilities

Can be applied across all business sectors

Example Values Framework for Islamic Financial Institutions (IFI‟s)

*Based on 2009 Survey by DinarStandard and Dar Al Istithmar, Jan 2010, Supported by Industry standardization body AAOIFI

19© DinarStandard 2005-2011

CR

ISIS

OP

PO

RTU

NIT

Y

Hunger

• Increased food prices in 2007/ 2008 has increased malnourished people worldwide by 119 million. Total to nearly one billion people . – Oxfam

Financial

• Collapse of major Wall Street institutions leading to a worldwide recession.

Climate

• Global carbon emissions rose 3 percent last year. Could result in large-scale melting of glaciers. With a dangerous rise in sea level. - NowPublic

Ignorance

• One in five children in developing countries does not complete five years of basic education; one billion illiterate adults.– PBS, Wide Angle

Health

• 14 million people in developing countries die from infectious diseases. Mostly due to expensive medicines. No Insurance. - Oxfam

Management

• Inaccurate financial reporting; executive pay excesses; bribery; labor/ employee abuse. Enron, Tyco, WorldCom, Satyam scandals.

Islamic Finance

• Unprecedented Opportunity to take global leadership

• A new guide to the Global Finance industry

• Take ownership of real-economy sectors with biggest human development impact.

Agriculture sector Leadership

• Egypt, Bangladesh, Pakistan, Sudan, Nigeria - are some of the most agriculturally endowed in the world however with dismally low productivity.

Sustainable Tech. Leadership

• Renewable energy initiatives – solar; wind power, other.

Education sector Leadership

• World-class education/ research institutes

• Thought leadership

Healthcare sector Leadership

• Healthcare management development

• Medical research leadership

Management Leadership

• Lead by example with ethically conscious management practices

• Sector investment focus • Sector investment focus • Sector investment focus • Sector investment focus • Management practices

Islamic Values driven opportunities

Islamic finance global leadership

*Based on DinarStandard analysis 20© DinarStandard 2005-2011

How we address the unique Muslim market gaps and opportunities

Our Growth Strategy Methodology*

© DinarStandard 2005-2011

*DinarStandard Consulting Framework

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FOOD & AGRICULTURE(OIC Economies)

ISLAMIC FINANCE

MUSLIMLIFESTYLEMARKET

OTHER*(OIC Economies)

Sectors/ Industries

GrowthSolutions

CUSTOMERGROWTH Marketing 2.0 Strategy | Planning

Customer Insights

MARKETEXPANSION Opportunity Analysis | Feasibility Studies

Investment Targeting | Business Planning

INNOVATIONWorkshops: Recipe for Innovation

Creativity Rehabilitation℠ | Digital Innovation

Summary of two Objectives today

1

2

A rich diversity of exciting brands are emerging from across

the Muslim lifestyle, Islamic finance and OIC markets -- yet

far from their potential or global impact.

Innovative Muslim Market Brands & Opportunity Gap

To realize full global potential of Muslim brands:

1. Develop products with unique soul: (core values/

purpose driven)

2. „Rehabilitate‟ an Innovation culture

3. Develop competitive, marketing & innovation practices

22© DinarStandard 2005-2011

Envisioned Future?

Salman Amin, CEO, Pepsico UK

World's Most Admired Companies (Fortune 2007)

World's Most Influential

Business Leaders

“You are the best of peoples ever raised up for mankind...”

(Qur’an: Al-Imran3:110)

*All logos are sole properties of respective organizations 23© DinarStandard 2005-2011

Growth Strategies for Emerging Muslim Markets

Reproduction of this presentation or any part of it

should be accompanied with proper credit to

DinarStandard and without any manipulation. All

third party images and logos are sole properties of

respective organizations.

24

CONTACT:

Rafi-uddin ShikohManaging Director

DinarStandard80 Broad Street, 5th Floor, New York City, NY 10004, USA T: 1-347-624-7454F: 1-201-526-8404E: rafishikoh@dinarstandard.comW: advisory.dinarstandard.com

© DinarStandard 2005-2011