Perception of Non-Muslim Consumers towards Halal Products in Malaysia

Research Paper Perception of Non-Muslim Consumers towards Halal Products in Malaysia Farah Raihana Binti Haji Ismail Lecturer, School of Accounting and Business Management, FTMS College, Technology Park Malaysia Bukit Jalil, Kuala Lumpur, Malaysia farah@ftms.edu.my Kauthar Binti Nasiruddin Lecturer, School of Accounting and Business Management, FTMS College, Technology Park Malaysia Bukit Jalil, Kuala Lumpur, Malaysia kauthar@ftms.edu.my Abstract The area of consumer behavior is exciting to be explored and study. The ways consumers behave, act and decide on certain matters become the main interest topic among the researchers. This study aims to explore the purchase intention and behavior of non-muslim towards halal products and to explore the perception of non-muslim consumer towards Halal-labeled food products. For this study, the data from 109 respondents were collected. Descriptive statistic indicated that the contributions of the religion, safety and convenience, and marketing towards purchase behavior are at the moderate levels. Results of the correlation analysis indicate that there is a strong and positive correlation between religion, safety and convenience, and marketing towards purchase behavior. The findings will be useful for marketers to better develop their products and come out with more competitive strategy to pull more of the non-muslim consumers as well as to provide opportunities for more research on the subject. Keywords: Halal, Non-Muslim, religion, marketing, knowledge, safety and convenience. 1. Introduction Muslim population is growing tremendously from year to year with a total of 1.6 billion worldwide (Dr. M. Amir Ali, 2006) while the world halal market has expanded in recent years resulting in more demand on halal product and service. Halal terminology is a term that is synonym with Muslim community worldwide. Halal product back in the days are consumed mostly by Islam followers, however, for the past few decades, halal products are gaining more market worldwide and more demand toward halal product no longer derived from Muslim communities only (Bakar, 2014). One of the factors that contribute to this demand might be due to the reason that Halal products are no longer just highlighting the animals slaughtering process for Muslims consumption but also to include highest quality in products or services to cater for the demand of non-muslims as well (Golnaz Rezai Z. M., 2011). Purpose of conducting this research is to explore more and understand non-muslim purchase behavior toward halal product and services. There is limited information regarding perception and consumption pattern of non-muslim toward halal products, what would be the factors that initiate non-halal product consumption and influence their purchase behavior. Thus, this study will explore further regarding halal product consumption pattern from non- Muslim perspective. According to Islamic Food and Nutrition Council of America, (2012), many of non-muslims have already chosen to consume halal food products due to perception that halal food products is a healthy choice and moreover in the next few years halal food consumption will boost up and highly demanded within health-conscious market. Religion, safety, convenience and marketing are among the factors that non-muslim perceived in making halal product consumption decision. ISSN: 2289-4519 Page 128

2. Literature Review 2.1 Halal and Global Market Halal word is an Arabic term meaning permissible which referring to anything that is permissible by Islam or permitted by Islamic law (Kamali, 2003). Halal concept covered the wide areas of consideration which are (1) source of income (J.M. Regenstein et al., 2003), (2) religiosity (Worthington Jr., et al., 2003), (3) attitude towards advertisement or towards product and purchase intention (Sternthal et al., 1990), and (4) word of mouth (Söderlund, 2006). Halal in global context is a growing market segment that gaining more popularity and demand from consumer around the world regardless Muslim or non-muslim consumer. Muslim population represents an estimated 25% of the world s population with 2.2 billion consumers (Population, 2012), which open up more halal product opportunities worldwide. For halal food product, the market has grown rapidly over the past decades which total estimated of halal food products is $632 billion annually (Canada, 2011). In general, Muslim in Malaysia will search for authentic halal certification issued by Malaysia s Department of Islamic Development (JAKIM); (Syed Shah Alam et al., 2011). 2.2 Religiosity Worldwide, food choices and consumption pattern and preferences vary across country. Different people with different ethnicity and religion have different way of life and belief, C. Pettinger et al., (2004) in his study indicated that religions can influence consumer attitude and behavior particularly in food purchasing decision and eating habits. According to (Dindyal, 2003), most societies in the world indicated that religions is the one of the most influential roles when it comes to shaping food choice among societies member. However, study done by Ernest Cyril De Run et al., (2010) argued that religion is not the only factor that matters the most in consumption world, instead, the intensity of one s religious affiliations known as religiosity (the degree of being religious) is crucial in molding one s purchase behavior. 2.3 Safety and Convenience Halal ideology regarding products and services emphasizes on the safety factor, hygiene, and wholesomeness of product and services which also will provides an excellent platform for healthy eating (Golnaz Rezai, 2011). As people worldwide are becoming health conscious, halal principle is no longer narrowed to the strictly religious but are becoming an appealingly healthy and hygienic cuisine style. However, in general, non-muslim perceived halal principle as the way an animal has been slaughtered (Golnaz Renai, 2011). Previous research done by (Mnela, 2009), found that non-muslim in Malawi prefer to consume halal food where they believe that halal products particularly food product is safer, the slaughtering process is much more ethical and it is complied with the Veterinary requirements. 2.4 Marketing In creating awareness toward halal product and services, marketing activities and effort play a vital role for company success. Brand and marketing activities will explore more on to what extent non-muslim consumers familiar with halal product and brand (Golnaz Rezai, 2011). Quality of the product is one of the elements that marketers need to be stressed out in order to convince and attract non-muslim consumers to purchase halal products. Halal is a credence attribute that cannot be evaluated or ascertained by the individual consumer, even upon or after consuming the good (Grunert, 2005). ISSN: 2289-4519 Page 129

3. Methodology 3.1 Data Collection and Analysis Explanatory research approach is being adopted as this paper aims to examine the causal relationship between two variables under investigation. The sampling frame listing all the population elements from which the sample is drawn. Therefore, the sampling frame applied for this study was from Klang Valley area. Moreover, the sampling technique that used in the respondent s selection was convenience sampling. Overall, a total of 124 respondents took part of this study, yet 15 of them were discarded due to incomplete responses which made the final sample was 109 for an effective response rate of 87.9%. In addition, survey questionnaire was the survey instrument for the data collection of the study. The questionnaire was designed precisely and distributed to each respondent involved. Furthermore, the units of analysis are individual non- Muslim consumers. 3.2 Statistical Analysis Method For this study, three statistical analysis methods (descriptive analysis, multiple response analysis and correlation analysis) has been used to measures the relationship between the variables. Through descriptive statistic, it helps the researcher to summarize and process the data and it involves numerical and graphical methods. Furthermore, multiple regression analysis is used to explore the impact of independent variables on dependent variable and correlation analysis is used to measure the strength of relationship between the two variables. 4. Research Findings 4.1 Descriptive Analysis The demographic characteristics were included in this study in an effort to provide a descriptive profile of the survey respondents. Majority of respondents were people in the age group of 19-25 years old (82.6%). It followed by those in the age group of 26-30 (12.8%), 31-35 (1.8%), and decrease to 0.9 percent for the group of 18 and below, 36-40, and 41-45.The sample shows that male respondents represented a higher percentage of the whole sample (53.2%) compared to the female respondents (46.8%). Furthermore, research findings indicated that the largest percentage (29.4%) was those in the monthly income group of RM 2,001 RM 3,000, most of the respondents were live in the urban area (88.1%) and for the rural area only 11.9 percent. Then majority of the people around of their work, study or living are non-muslims people (76.1%) and Muslim (23.9%). 4.2 Information about Halal Labelled Food Products The respondents were also required to provide some information based on experienced on behavior of Malaysian non-muslim perception and purchase behavior towards halal product. There are seven indicators for personal sources of information of respondents purchase behavior highlighted in this study which are doctors/nutritionists, parents, relatives, friends, government, teacher/lecturers and others. Research findings discovered that 34.9 percent of the respondent s personal sources of information are from friend. Then it followed by government (27.5%) and parents (14.7%). Then, it followed by doctor/nutritionists, teachers and others with 9.2 percent, 7.3 percent, and 6.4 percent. Furthermore, there are ten impersonal sources of information of respondents purchase behavior which are television, internet, store/ supermarket displays, newspapers, radio, Facebook/twitter, magazine, ISSN: 2289-4519 Page 130

government campaigns, halal food exhibitions, advertisements and promotion and others. From the study, the findings indicated that 31.2 percent of the respondent s impersonal sources of information are from internet. Then it followed by, store/ supermarket displays (22.9%) and television and Facebook/twitter (12.8%). Then, it followed by newspaper, advertisements and promotion, halal food exhibitions, others and government campaign with 5.5 percent, 4.6 percent, 1.8 percent, and 0.9. 4.3 Correlational Analysis The correlation analysis was performed among all the four variables of this study to understand the relationships between each of the variables. From the analysis, the findings identified that there is no very strong correlation (0.8 and above) between any pairs of the three variables of this study. The result revealed that four correlation coefficient values (religion, safety and convenience, marketing, and purchase behavior) were significant at 0.01 levels where marketing is found to have a strong and positive correlations with variables purchase behavior (r = 0.506). Furthermore, safety and convenience (r = 0.325) as well as religion (r = 0.430) are identified to have a strong and positive correlations with variables purchase behavior. Therefore the results of the correlation analysis show that there is strong and positive correlation between religion, safety and convenience, and marketing towards purchase behavior. According to Benny and Feldman (1985), a rule of thumb states that any correlation exceeding a value of 0.8 (very strong correlation) between independent variables is likely to result in multicollinearity in the data. Results of correlational analysis in this study revealed that multicollinearity was unlikely to affect the interpretation of the regression model as the absolute values of the correlation coefficients (ranging from 0.325 to 0.506) are lower than the acceptable cut-off value of 0.8. 4.4 Regression Analysis Religion, safety and convenience, and marketing factor are the independent variable to enter regression equation. The values of R and R Square for this model were 0.55 and 0.31 respectively while the standard error of the estimate was 0.42. Multiple R is the correlation coefficient for the simple regression of the independent variable (religion, safety and convenience, and marketing) and the dependent variable (purchase behavior). The R Square is the correlation coefficient squared, also referred to as the coefficient of determination. The standard error of the estimate is another measure of the accuracy of the predictions. It represents an estimate of the standard deviation of the actual dependent values around the regression line (Hair et al., 1998). The results of multiple regressions in this study indicated that the independent variables, religion, safety and convenience, and marketing are found to be significant. Firstly the interaction of religion is found to contribute significantly to the determination of purchase behavior. With β = 2.39 and P = 0.000, it shows that religion as the independent has a positive relationship purchase behaviors. Then, safety and convenience and marketing are found to contribute significantly to the determination of purchase behavior. With β = 0.19 and β =3.92 and P = 0.000, it shows that both of the independent has a positive relationship purchase behaviors. 5. Conclusion and Implication In present times, halal products regardless food, cosmetics and other products and services are no longer consume by Muslim consumers only. In this civilization era, halal ISSN: 2289-4519 Page 131

products are gaining more market from non-muslim consumers, the increasing demand of and purchase of halal products among no-muslim consumer might be influenced by the growing concern of health-concern community that demand more food products and other products that is well prepared (e.g. slaughtering process, cleanliness, and etc.) which is compliance with Islamic practices. From time to time, the non-muslims are getting aware and understand the context of halal products and services, perhaps the culture assimilation among Malaysian itself expose and attract non-muslim consumers to consume halal products. Therefore, it is important to understand the attributes that non-muslim consumers sought for in every purchase of halal product. Some of the attributes comprise the perception towards the halal labeled food products, the level of exposure towards halal food products and so forth. By understanding the purchase behavior of non-muslims towards halal labeled food products, it gives a better insight in providing more food products that cater non-muslim consumers and Muslim consumers demand as well as needs at the same time. This research also provides an early exposure on how non-muslims perceive halal labeled food products in Malaysia, thus, the research result might help food producers and suppliers to custom their products and tailoring their marketing strategy effectively in tapping non-muslim consumers market. Malaysian consist of multiracial ethnic which if the food producer and supplier knows how to tackle the market creatively, it will help to boost company sales and brand positioning and future time and thus also promoting halal products widely. References [1] Basera, M. M. (2012). The Influence of Socio-cultural Variables on Consumer s Perception of Halal Food Products: A Case of Masvingo Urban, Zimbabwe. International Journal of Business and Management., 7 (20), pp 112-119. [2] Bhattacherjee, A. (2000). Acceptance of E-Commerce Services:The Case of Electronic Brokerages. System and Human, 30 (4) [3] Canada, A. a.-f. (2011). Global Halal Food Market. Agriculture and Agri-food Canada. [4] Department of Statistic, M. (2012). Population and housing census, Malaysia 2010 (2010 Census). Retrieved from http://www.statistics.gov.my/ [5] Dindyal, S. (2003). How personal factors, including culture and ethnicity, affect the choices and selection of food we make. Journal of Third World Medicine. [6] George, J. F. (2002). Influences on the intent to make Internet purchases. Internet Research. [7] Golnaz Rezai, Z. M. (2011). Non-Muslims awareness of Halal principles and related food products in Malaysia. International Food Research Journal. [8] Grunert, K. G. (2005). Food quality and safety: Consumer Perception and Demand. European Review of Agricultural Economic. [9] IFANCA, I. F. (2012, October 22). Islamic Food and Nutrition Council of America (IFANCA). Retrieved from http://www.ifanca.org/website [10] Kamali, M. H. (2003). Bring back Islam. Principles of Islamic Jurisprudence. Retrieved from http://www.faithinallah.org/faithinallah/wpcontent/principles%20of%20islamic%20j urisprudence.pdf [11] Kaszprzyk, D. E. (2008). Theory of reasoned Action, Theory of Planned Behavior, and the Integrated Behavior Model. In B. K. Karen Glanz, Health Behavior and Health Education: Theory, Research, and Practice (p. 67). Wiley publisher. [12] Mnela, M. (2009, May 19). Malawi Non-Muslims Prefer Halal Food. Retrieved from Portal Info Halal IPIJ: http://halal.ipij.info/modules/ams/print.php?storyid=2 [13] Population, M. (2012). World Mulim Population. Muslim Population. Retrieved from http://www.muslimpopulation.com/world/ [14] Sack, D. (2000). Whitebread Protestants: Food and Religion in American Culture. Palgrave Macmillan. ISSN: 2289-4519 Page 132

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