Nestlé is "role model" for Islamic branding

LONDON: Nestlé is the leading multinational company when it comes to developing marketing strategies for Muslim consumers, according to Miles Young, worldwide ceo of Ogilvy & Mather.

Speaking to Warc at the Oxford Global Islamic Branding and Marketing Forum at the Saïd Business School, Young said the food and beverage giant had most quickly identified Muslim shoppers as an important demographic.

"Nestlé is probably the role model for doing this properly. It has done it out of conviction – there's a commitment in everything the company does from product design through to communications," he said.

Young, who delivered a keynote speech at the event, argued brand owners must think more seriously about how they are perceived by Muslim customers.

In demonstration of why this is important, he pointed out that 50% of the potential audience in the so-called "next 11" emerging economies are Muslim.

"You can't have a developing markets strategy without them," Young said. "I don't think MNCs have had to confront that before. It's suddenly becoming an issue."

Nestlé made $5.2bn (€4.0bn; £3.3bn) from sales of halal food in 2008, and has a strong presence in several nations where the majority of the population is Muslim, including Malaysia and Indonesia.

Research by Ogilvy found that, despite the huge differences in the cultural and financial situations of Muslims around the world, some 40% can be described as "futurists".

These are youthful, forward-looking consumers who are keen to have relationships with brands that can prove they are driven by the ethical principles behind Shariah law.

Elsewhere at the conference, Tan Sri Nor Mohamed Yakcop, a minister in the Malaysian prime minister's department, said McDonald's had only focused on the legal requirements of halal when entering the country.

However, the fast-food chain has now adopted a wider Shariah-friendly approach by investing in healthy alternatives and publishing nutritional details about items on its menu.

The key quality manufacturers and products need to show in order to connect with Muslims is sincerity, Young added.

That necessitates meeting the standards of Shariah throughout an organisation, from its supply chain to corporate social responsibility activities.

These practices can encompass ethical sourcing policies, an emphasis on nutrition and fairtrade, which overlap with other aspects of CSR.

To coincide with the launch of its Ogilvy Noor Islamic marketing division, Ogilvy has released an index ranking of the appeal of brands to Muslim consumers according to their compliance with Shariah.

Unilever's Lipton topped the table, with Nestlé and Nescafé in second and third place respectively.

Young cited offerings such as Mecca Cola that have been introduced for Muslim shoppers and failed. He argued that these used religion as a badge, but "misunderstood what it means to be a brand".

Instead, it is often firms from countries without a large Muslim population that have made the biggest strides in enhancing their Shariah-friendly credentials.

In part, Young suggested, this reflects the fact the internet has forced greater transparency.

"In the West the internet has put a premium on authenticity. In the last two to three years the nature of Western branded communications has started to change quite a bit," he said.

"It's moving towards a classic Islamic posture. In a curious way, the internet is making us all more Islamic."

Data sourced from Warc, 28 July 2010

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