Digital might of Muslim consumer: Spending to grow fastest by 2020

A new report estimates that the overall value contributed by Muslim consumers worldwide to the global digital economy in 2014 stood at $107 billion, representing 5.8 per cent of the total global digital economy.

The ‘Digital Islamic Economy Report’ for 2015, reckons that growth in total value of Muslim consumers’ contribution to the global digital economy (at a CAGR of 17 per cent by 2020) is expected to outweigh the growth of the total global digital economy (at a CAGR of 15 per cent by 2020).

The report has been published by Dubai Silicon Oasis Authority (DSOA) and Thomson Reuters, with support from the Dubai Islamic Economy Development Centre (DIEDC) in collaboration with DinarStandard.

It focuses on a new and a more specialised area of Digital Islamic Consumer Services.

Currently, more than 2,000 Islamic lifestyle services are being provided across websites and mobile platforms worldwide. The most popular categories include 'News and Insights' (used by 21 per cent of users), followed by 'Retail Sales' and 'Media and Entertainment'. Five segments within Digital Islamic Consumer Services have emerged as the most promising Islamic segments, namely Sharing Economy; Social Commerce; Retail e-Commerce; Food Transportation and Logistics, and Islamic Finance Investment Products.

E-commerce within the modest fashion sector has been identified as the most successful Islamic business model. Modanisa and SefaMerve, the top fashion online retailers, are among the top five leading Islamic consumer websites. The others include Muslima.com, Qiran.com and IslamicOnlineUniversity.com.

The findings indicate that social media services customised for Muslims have proven less successful as business models, especially services pertaining to 'News & Insights', which typically rely on revenue support from online advertising.

In terms of popularity and usage, the Islamic web and mobile application ‘Muslim Pro’ ranks highest in terms of downloads. Productivity and education apps, as well as apps for Halal food ratings and modest fashion also feature prominently on the Digital Islamic Consumer Services leader board.

Commenting on the significance of the report, Dr Mohammed Alzarooni, Vice Chairman and CEO, DSOA, said: “We are confident this report will benefit individuals and businesses targeting the Islamic economy industry by providing data and insights that can serve as a guideline for them to make more informed decisions.”

Nadim Najjar, Managing Director of Thomson Reuters, Middle East and North Africa, said: “The report reaffirms that Islamic digital economy has an integral part of everyday life, and indicates significant opportunity for growth in terms of business and innovation.”

Abdulla Mohammed Al Awar, CEO of DIEDC, said: “The promise and potential of the Islamic digital economy at the global level is well captured in the report, which offers viable solutions well beyond the typical sectors of banking and finance.”

The report serves as a precursor to the second edition of the Global Islamic Economy Summit (GIES) that will be held on October 5-6 in Dubai.
 

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