Islamic. vs. Conventional. Marketings

ISLAMIC Vs CONVENTIONAL MARKETING & ADVERTISING

By: Prof. Dr. Mohd. Ma’sum Billah masum2001@yahoo.com applied-islamicfinance@yahoo.com

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Introduction

Many people simply think that marketing and advertisement relates each other and that happened when a party sells goods and another party come and buy the goods. Actually, marketing and advertisement has a very wide definition. Let’s talk about marketing first. According to AMA 1960, marketing is the performance of business activities that direct the flow of goods and services from producer to consumer or user.

Another meaning is marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational goal.[1] Exchanges here mean the idea that people give up something they would rather have. In our daily routine, we do marketing and we always think that money is the medium of exchange. However, exchanges do not require money only but also can be through barter, trade of items or services.[2] For instance, we can trade or barter such item as rice and salt.

Advertisement is any form of paid communication about a product that is paid for by a marketer. This definition gives us explanation that marketing and advertising must ‘go together’ in order to achieve the business goal, that is profit.

Islam allows all these to be practiced in our life, as a Muslim but there is certain rules or condition that must be aware or to be careful with. In other words, Islam does not prohibit its ummah in practicing marketing and advertisement. Marketing and advertisement is part of business. Rasulullah SAW said, “9/10 of income is part of business”

Islam accept the definition of marketing and advertisement but there is some other Islamic elements should be added in there such as trustworthy, halal product, creating consumer loyalty and others that will be discussed later ISLAMIC MARKETING AND ADVERTISEMENT Vs CONVENTIONAL MARKETING AND ADVERTISEMENT

Today, businesses are faced with so many challenges, changes, and expectations. Technology becomes the main driving force in making decisions especially in answering the questions such as what to produce, what price to charge, how to distribute the product, how to increase the sales volume, how to make the promotion and so on.

Conventional marketing has two facets. First, it is a philosophy, an attitude, a perspective, or a management orientation that stresses consumer satisfaction. Second marketing is a set of activities used to implement this philosophy.

Islamic marketing is the process which done along the path of Islamic principle can play a very important in raising the standards of Islamic business conduct worldwide. The Islamic marketing practice also responsible for giving the best quality of products offered to customer while maintaining the allowable profit margin for the company.

Islamic marketing highlighted the capabilities and strengths in creating and sustaining a strong ethical marketing culture between both parties, which are the buyer and seller. Thus, it can establish a harmony and meaningful cooperation between marketers and Muslim target markets in particular. It concentrates the principle of value maximization based on equity and justice (constituting just dealing and fair play) for the wider welfare of the society.[3] This was mentioned in Al-Quran in Surah An-Nahl: “God commands justice, the doing of good, and liberality to kin and kin, and He forbids all shameful deeds, and injustice an rebellion: he instructs you, that ye may receive admonition.” (16:90)[4]

Marketing Management Philosophies

Production Orientation

A philosophy that focuses on the internal capabilities of the firm rather than on the market place. Meaning that it does not consider whether the goods and services that the firms produce fulfill the needs of society or not. This philosophy is not suitable to practice in Islamic marketing because Islam emphasizes its ummah to be united. We live together and we must help each other in whatever kind of things.[5]

Doing marketing is what we called as fardhu kifayah whereas in a community there must be someone to learn about certain knowledge, otherwise Allah will blame all of the community. For example, someone who study in engineering. It is not compulsory to the whole community to study engineering but it is enough if someone study it, meaning that the person has perform his or her obligation and save all the community. Same cases in marketing where we have to try to fulfill the ummah need. For example, try to learn how to produce halal Chinese food and market them.

Sales Orientation

Sales orientation is based on the ideas that people will buy more goods and services if aggressive sales techniques are used and that high sales result in high profit.[6] We have to work hard to get more profit. Islam agree in this philosophy because Islam encourage us to get better life, but in order to seek for better life we must not forget the spiritual. Material and spiritual both should come together in line as mentioned in Al-Quran, in Surah Al-Qasas: “But seek, with the (wealth) which Allah has bestowed on thee, the home of the hereafter, nor forget thy portion in this world: but do thou good, as Allah has been good to thee, and seek not (occasions for) mischief in the land: for Allah loves not those who do mischief.” (28:77)

Market Orientation

The idea that social and economic justification for an organization’s existence is the satisfaction of customer wants and needs while meeting organizational objectives. This means, the organization is focusing on customer needs and wants to achieve the long-term goals for the organization.[7] This kind of philosophy also accepted in Islam where both parties get the benefits; the producer get the profit and the consumer get the goods and services they want.

Societal Marketing Orientation

This philosophy states that an organization exists not only to satisfy customer wants and needs and to meet organizational objectives but also to preserve or enhance individuals’ and society’s long-term best interest.[8] Take for an example, the company’s plastic containers are made of recyclable plastic, and its spray products do not use propellants that damage the ozone layer in the earth’s upper atmosphere. Islam also very concern in this matter. As a khalifah in this world, Allah created us as the best creation. We know to differentiate between the good and the bad one.

Morality And Business Ethics In Marketing

Business ethics today actually consist of a subset of major life values learned since birth. The values businesspeople use to make decisions have been acquired through family, educational, and religious institutions. Ethical values are situation specific and time oriented. Everybody must have an ethical base that applies to conduct in business world and in personal life. The same thing also applied in marketing and advertising. Both conventional and Islamic way very much emphasize in a high morale and ethics. So this will be discussed together.

In Islam, akhlaq (character) is so inclusive and integrative which deals with the relationship with man and Allah, man and the other creatures of the universe and innermost self. Akhlaq is very important to guard man’s behavior, thought, feelings, and intentions. Akhlaq also the main objective of the Prophethood SAW mission that was to perfect the character as he said: “I have been sent to perfect the good character”

The most important thing to be performs in doing everything is trustworthy or amanah (Arabic term). It means as a producer, we must produce the best for our consumer. We only market the best product. Best here means the product is in a good condition and satisfied the consumer or in the other words, no cheating in the business. Consider these examples of rules: o Always treat others as you would like to be treat o It is wrong to lie, bribe, or exploit o No customer, no business

In conventional marketing, loyalty and obedience to the society become paramount. At the level of morality, an ethical marketing would be concerned only with whether it is legal and how others will view it. This could be likened to the adage “When in Rome, do as the Romans do.”

Business Marketing Challenges

Nowadays, marketing must be understood not only in the old sense of making a sale. The speed of development of technology today, marketing become more challenges to the producers.

Increasing The Volume Of Sales

A sales-oriented organization seeks to achieve profitability through the sales volume and tries to convince potential customers to buy, even if the seller knows the customer and the product are mismatched. A sales- oriented organization place a higher premium on making sale than on developing a long-term relationship with customer. In contrast, the ultimate goal of most market-oriented organization is to make a profit by creating customer value, providing customer satisfaction and building long- term relationship with customers. The exception is so-called non-profit organizations can and should adopt a market orientation.

As discussed in the marketing philosophies before, Muslim producers can choose which philosophy they want to produce. For example, in the West, beers manufacturers sponsor and promote sport events. The spectators watching the sport in the field go there to have the so-called ‘Good-Time’; and the same are true for those who watching the event on television at home. Since the western idea of a good time is associated with drinking alcoholic beverages, this is what exactly happens. Those watching the game in the stadium or on TV end up drinking heavily, hence increasing the sale of beer and other alcoholic beverages.

Therefore, the Muslim producers can implement this concept to derive the efficient and effective marketing of the halal product that would raise the level of Islamic consciousness of the people, eventually contributing to increase in the demand for their particular product.[9]

Distribution Decision

To achieve customer satisfaction, the company must have the right product at the right place, at the right time and of course at the right price or known as 4P’s. Getting the product to the consumer at the right 4P’s can give the best result. Once the product is designed, developed, and produced, marketing must get the product from the factory to the end-user using the best methods.

Here are some methods that has been used by the Western marketers or producers, which can be implied in Islamic marketing and advertising. For instance, advanced manufacturing system (AMS), that included “just-in-time” (JIT) and “electronic data interchange” (EDI). These methods can reduce costs, allow faster product delivery, and increase the efficiency of operations between the shop floor and distribution of the product.[10]

There are two types of markets for product, which are the market in non-Muslim countries and the markets in the Muslims countries. In the case of the non-Muslim countries, the problem is serious because the Muslim communities are scattered. Thus, it is difficult to distribute through dealers because in many cases there are no dealers but only the scattered small retailers. The labor cost is so high that the price will become uncompetitive compared to the same product that lacks halal attributes.

Despite these difficulties, one cannot discount the big potential of halal food market. The answer is to make the product halal in the first place and make it available for all.[11]

Meanwhile, some of the real issues in the Muslim countries markets are honoring the commitments on a regular basis and maintaining quality. In addition, while dealing with the local distributor, it is important to know their culture, their expectations, and their way of saying “Yes” and “No’. One should also be ready to learn how things can be made in that culture. Therefore, it is suggested to Muslim producers to applied the Western methods that have been discussed before because; technology is a powerful force behind improvements in distribution.

Islam accepted these methods as long as the producers keep on track that is to fulfill their obligation as a Muslim. This can be explained that Islam never restrains its ummah to compete with others in the exchange and the development of the world so that they are not left behind.

Promotion Decision

When purchasing a product or service, a customer does not think in terms of advertising, sales promotion, public relations, and personal selling, nor does their think in terms of marketing, manufacturing, research and development, and human resources. Rather, the product or services received by the customers the sum of all the internal processes. It is the firm’s or the producer’s responsibility to make certain that the product or the service received by the customer has received via the firm’s integrated marketing communications.

This can be done through the promotional strategy such as advertising, public relations, personal selling, and sales promotion.[12]

Advertising is form of impersonal, one-way mass communication paid for by the source. Public relations are the function of promotion concerned with a firm’s public image. Firms cannot buy good publicity, but they can take steps to create a positive company image. Sales promotion is typically used to back up other components of the promotional mix by stimulating immediate demand. Finally, personal selling typically involves direct communication, in person or by telephone; the seller tries to initiate a purchase by informing and persuading one or more potential buyers.

In an absolute Muslim Majority case where the total presence of non- Muslims is only marginal, it is appropriate to emphasize the Halal nature and characteristics of the food so that it attracts the common folks in the society who are a majority. In a multi-religious society where Muslims are a significant proportion of the population the product can be marked as Halal on the label so that the members of the community are aware of its status as well as promoting the product in the Muslim and ethnic media.

Malaysia is the best example to describe the Islamic advertising in multi religious society. All of its halal products must get the approval from the leading Islamic body; Jabatan Kemajuan Islam Malaysia (JAKIM). After having the approval, then only the products can be distributed to the market as the halal product. The Quran mentioned in Surah Al-Baqarah: “O ye people! Eat of what is on earth, lawful and good; and do not follow the footsteps of the evil one, for he is to you an avowed enemy” (2:168)

Meanwhile, the suitable example of Islamic advertising in the pure Islamic region is the promotion of “Zam Zam Cola” which is the Iranian halal product. It is become part of the fight against Western culture aggression. Another example is in America, they have what they called as “Razanne” the “Muslim Doll”, replaced the Barbie Doll where she is dressed much more modestly; she covered with a hijab and gown spanning most of her body.[13]

Pricing Decisions

Pricing is the one element of the marketing mix that is ‘owned’ by multiple groups within a company. Marketing is interested in pricing to provide value to the customer, while meeting competitors’ prices. Naturally, finance has keen interest in the pricing process in relation to its targets for return on investment.*

The relationship between price and demand has downstream effects on the manufacturing process, bringing production capabilities into the pricing decisions, particularly in relation to the company’s ability to produce the number of units needed to break even.* Meaning that the producers or the firm did not get any profit but only the amount, enough to cover back the cost they have invest.

The same thing also applied in Islam. However, it must to remember that the producer or the firm must pay for the zakah. Zakah is the basic fundamental in Islamic teaching immediately after solat. Allah condemns those who do not pay zakat and promise forgiveness to those who pay zakah. Anyone who refuse to pay is not consider as a true believers. Besides that, zakat may help to eradicate poverty and hunger from the community.

Conclusion

In a nutshell, it can be concluded that, both, that is Islamic marketing and advertising and conventional marketing and advertising is established with the purpose to provide a harmony and meaningful cooperation in the market itself.

It has been discussed that the Islamic and conventional in both situation; marketing and advertisement, has not much differences. This is because the Islamic one applied the same thing like the conventional but some other Islamic element added in it.

There are four marketing management philosophies such as production orientation, sales orientation, market orientation, and societal orientation. Also has been discussed about the morality and business ethics. This assignment has discussed about the marketing challenges such as increasing the volume of sales, distribution decisions, promotion decision and pricing decisions.

[pic][pic] ----------------------- [1] Lamb, Hair, McDaniel, Marketing Seventh Edition, p.6 [2] Ibid, p.7 [3] Saeed, Mohammad, Ahmed, Zafar U, International Marketing Ethics from an Islamic Perspective: a value-Maximization approach, (Journal of Business Ethics-Jul 2001 Part 2, Vol 32 Issue 2), p127 [4] Abdullah Yussuf Ali, The Holy Quran (Text and Translation), p255 [5] Lamb, Hair, McDaniel, Marketing Seventh Edition, p.6

[6] Ibid, p.7 [7]Lamb, Hair, McDaniel, Marketing Seventh Edition, p.7

[8] Ibid, p.7 [9] Mohamed El-Mouelhy, Marketing Halal (www.halalhelpline.org),p.2 [10] Lamb, Hair, McDaniel, Marketing Seventh Edition, p.372 [11] Mohamed El-Mouelhy, Marketing Halal (www.halalhelpline.org), p3 [12] [13] Lamb, Hair, McDaniel, Marketing Seventh Edition, p.462 [14] Mark I.Pinsky, Marketing to Muslim, (www.kansas.com)