Halal is an Arabic term meaning “permissible” or “lawful.” To obtain halal certification, food manufacturers must comply with Islamic dietary laws as prescribed in the Quran, the Islamic holy book. Among other things, these laws prohibit the use of ingredients made from pork and alcohol, and set down guidelines for preparation and storage.
Numerous halal certification organizations have sprung up around the world, such as the Department of Islamic Development Malaysia, a government institution better known by its local acronym, JAKIM. Different bodies adopt their own standards for determining the halal status of products or services, and each has its own logos to be printed on packaging and other materials.
In Indonesia, the world’s most populous Muslim country, local cosmetics brand Wardah has gained huge popularity among young women by focusing on halal-compliant products.
The company’s advertisements, which aim to project a modern yet timeless style, feature images of Muslim models wearing hijab headscarves and bright smiles. The salespeople at Wardah cosmetic counters all wear blue-green hijab, the color of the brand. “All women want to look just like these beautiful models,” one salesperson said.
Wardah currently sells 300 cosmetic products at about 22,000 locations in Indonesia and Malaysia. In the years following its establishment in 1995, Wardah remained a small local brand. Its popularity skyrocketed after it became the official sponsor of the 2013 Indonesian box-office hit “99 Cahaya di Langit Eropa” (“99 Lights in the European Sky”), in which the hijab-wearing lead actress used the company’s products.
Since then, the company has kept the momentum up, launching TV ad campaigns and sponsoring fashion events showcasing young designers’ Muslim-friendly clothing collections. From a virtual unknown a decade ago, the company now enjoys nearly 50% growth in annual revenue and controls a 5% share of the domestic market.
The company’s performance, while impressive, is not altogether surprising, given how rapidly the global halal market is growing. According to a recent report by Deloitte Tohmatsu Consulting, it is estimated to have surpassed $1 trillion in 2015, with food products accounting for 61% of the world’s halal trade, pharmaceuticals comprising 26% and cosmetics 11%.
In countries with predominantly Muslim populations, even nonfood halal markets, such as daily necessities and cosmetics, are already thriving. Malaysia’s JAKIM said 70% of the applications it receives for halal certification are from the nonfood sector. Less strict halal standards have so far been applied to basic necessities than to food. Nevertheless, many consumers prefer halal-compliant daily goods, not only to ensure they do not run afoul of Sharia, but also because they consider certified goods to be a safer, healthier choice.
International consumer brands have recognized this trend and are keen to tap the vast and promising halal market with halal-friendly products. Alcohol-free products such as a body wash available from Johnson & Johnson of the U.S. and toothpaste from Anglo-Dutch giant Unilever have already proven popular with consumers.
While established players have quickly customized their existing products for the halal market, newcomers are developing innovative items aimed specifically at complying with Islamic rules and practices.