Description
Marketing plays a very important role in fulfilling consumers' needs, besides achieving company goals. In fulfilling these goals, Muslim marketers must ensure that all aspects of marketing activities, such as planning of goods and services, pricing and distribution strategies, as well as the promotional techniques used, are in accordance with the regulations stipulated in the Quran and the Sunnah.
Compliance to Islamic marketing
practices among businesses
in Malaysia
Kalthom Abdullah
Department of Business Administration,
Kulliyyah of Economics and Management Sciences,
International Islamic University Malaysia, Kuala Lumpur, Malaysia, and
Mohd. Ismail Ahmad
Department of Business Administration, Management Center,
Kulliyyah of Economics and Management Sciences,
International Islamic University Malaysia, Kuala Lumpur, Malaysia
Abstract
Purpose – This research paper aims to explore the perceptions of Muslim consumers of the degree of
compliance of Malaysian businesses to Islamic marketing practices and promotional strategies.
Design/methodology/approach – The perceptions of the Muslim consumers were examined by
distributing a self-administered survey questionnaire to a sample of 450 Muslim respondents residing
in the major towns in Peninsular Malaysia. Items used in the questionnaire were derived from the
basic guidelines provided in the Quran and the Sunnah on the conduct of business practices,
speci?cally on the general marketing and promotional practices used.
Findings – Findings suggest that though there is an awareness of these regulations and practices,
not many businesses in Malaysia are perceived to be complying with them both with respect to general
Islamic marketing principles and with recommended Islamic promotional practices. There was also a
signi?cant difference in opinions expressed by Muslim consumers due to the in?uence of their
religious educational background and the states in which they resided.
Practical implications – There is a need towards more research on how Islamic guidelines could be
applied in all aspects of marketing activities. This could create more awareness among businesses
about the issues and obligations that are relevant in marketing practices.
Originality/value – This research is a rare attempt on the part of researchers and scholars in
Malaysia to relate the Islamic injunctions and guidelines on a speci?c discipline such as marketing.
Although there have been many studies on Islamic ?nance and economics, the area of Islamic
marketing remains clearly under researched.
Keywords Islam, Consumers, Individual perception, Marketing strategy, Promotional methods,
Malaysia
Paper type Research paper
1. Introduction
This study aims to examine the perceptions of Muslim consumers regarding the extent
of compliance of businesses to general Islamic guidelines on marketing and
promotional strategies. In line with this objective, the demographic background of
respondents were examined to determine if any relationship exists between factors
such as age, education background, and place of residence and their perceptions of the
degree of compliance among businesses in Malaysia.
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1759-0833.htm
JIMA
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Journal of Islamic Marketing
Vol. 1 No. 3, 2010
pp. 286-297
qEmerald Group Publishing Limited
1759-0833
DOI 10.1108/17590831011082446
Being the world’s second largest population after Christianity with 1.57 billion
adherents, Islam comprises 23 per cent of the world population (List of countries by
Muslimpopulation, 27 January 2010). In Malaysia, a sizeable proportion (60.4 per cent) of
Malaysia’s population, which stands at 27.73 million for the year 2008 are Muslims
(approximately 16,748,920). This makes Malaysia number 13 in the world’s most densely
Muslim populated countries (2009 World Population Stats – Muslim – majority
Countries, November 2009). Thus, a studyof this nature is veryimportant to determine the
level of awareness of Islamic injunctions among the predominantly Muslim community.
Through a survey of a sizeable convenience sample of Muslimadults within Peninsular
Malaysia, this study hopes to ?nd and explain differences if any, in the perceptions of
Muslim consumers with regards to the adherence to Islamic principles and practices by
businesses with respect to their general marketing strategies and promotional activities.
The main focus would be on the in?uence of religious knowledge possessed by the
respondents and the states in which the respondents resided. It is hypothesized that the
more Islamic knowledge a respondent possesses the more equipped he or she will be in
evaluating whether the Islamic guidelines are adhered to. In addition, since it is observed
that there are differences inthe awareness level of the Shariahknowledge andrequirements
in the conduct of daily life and business activities based on the state one resides in, this
study intends to ?nd the effect of this factor on the perceptions of respondents towards
compliance by businesses to Islamic guidelines.
2. Review of literature
Marketing plays a very important role in ful?lling consumers’ needs, besides achieving
company goals. In ful?lling these goals, Muslim marketers must ensure that all aspects
of marketing activities, such as planning of goods and services, pricing and
distribution strategies, as well as the promotional techniques used, are in accordance
with the regulations stipulated in the Quran and the Sunnah.
Islamic guidelines ensure that the interest of all parties in a transaction, that is, the
buyers, sellers, business partners and the community are safeguarded. As such,
Muslim businesses are able to maintain a balance between their responsibilities to the
company in terms of pro?ts, to the consumers in terms of providing safe and quality
products, and towards ensuring the welfare of society.
Hanafy and Salam (1988) outlined six categories of ethical principles that can be
applied to marketing activities. These are the principles of truthfulness, trust, sincerity,
brotherhood, science and technology and justice. All aspects of communication to the
consumers, whether through advertising or personal selling, must be done in a truthful
manner without any intentions of misleading them or cheating them. A marketer must
uphold the trust Allah (swt) has in him through proper management of the resources
bestowed upon him for the betterment of society and the surrounding environment.
There must be sincerity in ful?lling consumers’ needs and ensuring consumer safety,
as well as having a sense of brotherhood in dealing with business partners and
consumers. This would not only ensure success in business but would also uphold the
con?dence and loyalty among consumers. Finally, the concept of justice could be
upheld in ensuring that all dealings are conducted with fairness to all parties, for
example, in pricing products.
The purpose of promotionis to informpresent andpotential customers about existing
or new products and/or services, to persuade customers to change their behavior in
Compliance to
marketing
practices
287
terms of product trial or purchase, to develop favourable attitudes towards the product,
brand or company, or to remind customers about the product’s bene?ts (Kotler and
Armstrong, 2004). These objectives are achieved using various promotional tools, such
as advertising, sales promotion, events, public relations, publicity, personals selling and
direct marketing. The bene?ts of these promotional activities can bene?t the economic
progress and social development of a society by encouraging healthy competition,
providing more choices for customers, and enhance moral conduct among others
(Anwar and Saeed, 1996). However, promotional activities should not propagate
overspending or wasting of natural resources through unnecessary packaging, for
example.
Rice and Al-Mossawi (2002) applied the Islamic value dimensions such as,
communication style, honesty of communication, appreciation of diversity of human
race, justice and fairness, role of women, consumption behavior, modesty, and care for
the environment to advertising strategies. These dimensions are categorized into four
cultural dimensions of relationships with people, time orientation, human nature
orientation and activity orientation. The authors provided a thorough framework for
marketing managers in their attempt to develop advertising campaigns that are in-line
with the Islamic teachings.
Since, one of the purposes of the promotional tool of advertising is to inform or
educate the consumers, it is pertinent that the information disseminated encourages
good deeds by depicting Islamic behaviors of respect for the elderly, family bonding as
opposed to messages that encourage reckless driving, unnecessary spending, and free
mixing of males and females. It is stated in the Quran, “Let there arise of you a group of
people inviting to all that is good (Islam)enjoining Al-Ma’ruf and forbidding Al-Munkar
and it is they who are successful [. . .] (A
ˆ
l-Imran 3:104). Prophet Mohammad (pbuh) said:
“I have been sent only for the purpose of perfecting good morals.” When asked “Which
Muslimhas the perfect faith?” The Prophet (pbuh) answered: “He who has the best moral
character”(Alghazzali, 1983). Thus, all advertising messages that follow the Islamic
teachings propagate good moral, such as women in decent manner and clothing,
assuming their role as a positive contribution to the family and society as a whole as
opposed to being used as objects of sexual desire (Rice and Al-Mossawi, 2002).
A promotional appeal that propagates wasteful spending on unnecessary things
through the various special price offers is against the teachings of Islam that fosters
moderation both in spending and saving. However, price discounts offered by retailers
that could bene?t consumers in terms of saving money on items on sale are encouraged
(Abdullah, 2008). It is stated in the Quran, “Those who, when they spend, are not
extravagant and not niggardly, but hold a just (balance) between those (extremes)”
(Al-Furqan-25:67).
With regards to public relations activities directed towards the community, events
such as collecting donations for a charitable cause such as helping victims of natural
disasters, or building an orphanage would be major contribution for social welfare
and is a form of sadaqah. Provided that the manner of hosting such events are in
conformance to the Islamic code of conduct, these acts are considered as ful?llment of
social responsibility which is encouraged in the Quran “Those who rehearse the Book
of Allah, establish regular Prayer, and spend (in charity) out of what We had
provided for them, secretly and openly, hope for a Commerce that will never fail.”
(Faˆtir 35:29).
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3. Purpose and rationale
The main purpose of this study is to examine the degree of compliance to Islamic
guidelines among businesses in Malaysia in their marketing and promotional strategies.
Data were gathered from a sample of Muslim consumers to examine their perceptions
towards the practices of businesses, and whether their religious background and their
place of residence have any in?uence upon their awareness of Islamic guidelines
governing business practices.
4. Method
In this study, the perceptions of the Muslim consumers towards the promotional
practices of companies were examined by distributing a self-administered survey
questionnaire to a sample of 450 Muslim respondents residing in the major towns in
Peninsular Malaysia. The completion of the structured questionnaires was supervised
by enumerators to ensure that all questions and instructions were understood. The
survey generated a suf?ciently high response rate of 88 per cent which allows for the
reliability and generalisability of the ?ndings to the perceptions of most of the Muslim
consumers in Malaysia. Items used in the questionnaire were derived from the basic
guidelines provided in the Qur’an and the Sunnah on the conduct of business practices,
speci?cally on the general marketing and promotional practices used.
A structured questionnaire containing the statements on the practices of businesses
was used whereby respondents were asked to evaluate howmany companies adhered to
the Islamic guidelines, based on their perceptions. The ?rst part of the questionnaire
contain statements on general marketing practices related to whether Muslim
companies generally conduct their business activities according to the Shariah, whether
“fair” dealings was applied in the transaction of business activities, the extent to which
Muslim businesses follow the guidelines set in the Shariah, and whether non-Muslim
companies made any attempt at following the Shariah guidelines in their marketing
activities. The second part of the questionnaire focused on the promotional perspectives.
In this regard, respondents were required to indicate their agreement on statements
related to disclosure of truthful information to buyers, use of exaggeration and making
false promises to buyers, exploitation of women in advertisements, exaggeration and
deceptive practices, and use of celebrities in the advertising messages. The degree to
which businesses adhere to the Islamic principles was measured by indicating the scales
in percentages in the questionnaire; less than 25 per cent (fewbusinesses), 26-50 per cent
(some businesses), 51-75 per cent (majority of businesses), and 76-100 per cent (almost all
businesses).
5. Results and discussions
Data collected for this study were analyzed using descriptive statistical technique.
An analysis of the demographic data of the respondents indicates that more than half of
the respondents were females (54.8 per cent), and between the ages of 20-39 years old
(52.3 per cent). Most of the respondents were married (73.8 per cent) with more than
half (58.2 per cent) having one to six children. In terms of the educational background,
it was further indicated that 40.3 per cent of the respondents have background
education in Islamic studies with a certi?cate (25.8 per cent), a diploma (7.0 per cent),
and a degree (7.5 per cent). With respect to job category, it was found that 64.3 per cent
of the respondents were employed either in the government or private sector.
Compliance to
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practices
289
Through an analysis of the states in which the respondents resided, it was found that
nearly half (48 per cent) were fromthe western regions of Perak, Selangor, Kuala Lumpur,
and Putrajaya, followed by those from the eastern regions of Kelantan, Trengganu and
Pahang (30.8 per cent). Those fromthe northern regions of Kedah, Perlis, and Penang; and
the southern region of Johore, Negri Sembilan and Malacca contributed only 13.1 per cent
and 8.3 per cent of the respondents, respectively, (Table I).
The pro?le of the respondents indicated that the sample of respondents who
participated in this survey are mostly educated adults with either conventional education
together withIslamic educationandthus are well aware of, or conscious of the requirements
of general marketing and promotional activities as expected in Islam. Thus, their
observations andtheir resultingresponses to the statements onthe promotional practices of
companies and the role of the government in regulating these practices are relevant.
The responses of the respondents to statements listed in the questionnaire are
tabulated in Table II. In terms of the general marketing practices, the ?ndings of this
study indicate the following:
Demographic Frequency (400) Percentage
Gender
Male 181 45.3
Female 219 54.8
52.3
Age-group
20-39 209 45.0
40-60 180 2.8
Above 60 11
Marital status
Not married 105 26.3
Married 295 73.8
Number of children
No children 114 28.5
1-3 children 116 29.1
4-6 children 116 29.1
More than six children 54 13.5
Education
No formal education 93 23.3
Certi?cate in Islamic studies 103 25.8
Diploma in Islamic studies 28 7.0
Degree in Islamic studies 30 7.5
Others 146 36.5
Employment status
Government employee 167 41.8
Private sector 92 23.0
Own business 45 11.3
Retired 24 6.0
Others 72 18.0
Regions
Northern (Kedah, Perlis, Penang) 52 13.1
Southern ( Johore, Negri Sembilan, Malacca) 33 8.3
Western (Perak, Selangor, Kuala Lumpur, Putrajaya) 192 48.0
Eastern (Kelantan, Trengganu, Pahang) 123 30.8
Table I.
Pro?le of respondents
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Table II.
Descriptive analysis on
responses to statements
Compliance to
marketing
practices
291
.
Statement 1. A total of 87.3 per cent of the respondents perceived that only a few
(less than 25 per cent) and some (25-50 per cent) of the businessmen in Malaysia
observe the Islamic guidelines in their business activities.
.
Statement 2. A total of 82.8 per cent of the respondents perceived that only a few
(less than 25 per cent) and some (25-50 per cent) of the businessmen in Malaysia
practice fair dealings in their business activities.
.
Statement 16. A total of 71.1 per cent of the respondents perceived that only
a few (less than 25 per cent) and some (25-50 per cent) of the Muslim businessmen
in Malaysia conduct their marketing activities according to the Islamic guidelines.
.
Statement 17. Atotal of 84.8 per cent of the respondents perceived that only a few
(less than 25 per cent) and some (25-50 per cent) of the non- Muslimbusinessmen in
Malaysia conduct their marketing activities according to the Islamic guidelines.
From the responses on the question pertaining to the marketing practices of Muslim
and non-Muslim businessmen, ?ndings suggest that most respondents perceive that
even though there is an awareness of the regulations stipulated in the Quran and
Sunnah, not many businessmen (few and some) in Malaysia observe them in their
business activities. This is evident in the high percentage of respondents who indicated
that not many businessmen observed the practices outlined. In terms of the
promotional practices, the ?nding of this study indicates the following:
.
Statement 11. Atotal of 63.8 per cent of the respondents perceived that only a few
(less than 25 per cent) and some (25-50 per cent) of the businesses in Malaysia give
full disclosure about their products to buyers by providing true information.
.
Statement 12. A total of 58.8 per cent of the respondents perceived that only a
few (less than 25 per cent) and some (25-50 per cent) of the businesses in
Malaysia gave truthful disclosure about their products. Instead, more than half
of the respondents have the opinion that these businesses exaggerated and made
false promises regarding the products.
.
Statement 13. A total of 90 per cent of the respondents perceived that majority
(more than 50-70 per cent), and most (more than 75 per cent) of the businesses are
using women (stereotyping) in their advertisements.
.
Statement 14. A total of 77 per cent of the respondents perceived that few (more
than 25 per cent) and some (25-50 per cent) of the businesses in Malaysia are
following Islamic guidelines on advertising with respect to the use of vulgar
languages, exaggeration and deceptive means.
.
Statement 15. A total of 70 per cent of the respondents perceive that many
businesses (more than 50 per cent and most (more 75 per cent) of businesses in
Malaysia are following the Islamic guidelines, regarding the use of celebrities
in their advertising.
From the promotional perspectives, it can be seen that not many Muslim businesses in
Malaysia are perceived to be following the Islamic guidelines with regards to giving full
disclosure of information about their products. Further, these businesses are perceived
to exaggerate the bene?ts of their products, make false promises to customers, as
well as use vulgar languages and resort to deceptive means to promote their products.
JIMA
1,3
292
These are certainly not recommended as good Islamic marketing practices.
Additionally, many companies are seen to be using women as stereotypes in their
advertising and using women to endorse their products. Again, these are practices that
are not within the boundaries of Islamic guidelines.
A cross-tabulation analysis done between the demographic factors and the
responses to the statements indicated mixed ?ndings in the relationships between
these variables. There are no signi?cant relationships between age and gender and the
statements except for education and place of residence. It was indicated from Table III
that for statements on general marketing practices, there was a signi?cant relationship
between statement 1: “businesses activities in Malaysia are conducted according to
Islamic guidelines and regulations” and educational background ( p ¼ 0.018). The same
?nding was obtained for the relationship between statement 17: “non-Muslim
businesses generally follow and practice Islamic guidelines in their marketing
activities” and gender ( p ¼ 0.087), and state of residence ( p ¼ 0.019). For promotional
practices, there was a signi?cant relationship between statement 11: “businesses
are following Islamic guidelines regarding disclosure of information to buyers” and
state of residence where p ¼ 0.027, statement 12 “businesses are following Islamic
guidance regarding disclosures to customers” where p ¼ 0.049, and statement 14:
“businesses are following Islamic guidelines on advertising (no vulgarity, no
deception) and educational background” where p ¼ 0.052.
It can be concluded that the religious background of the respondents do have an
in?uence on the perceptions of the Muslim consumers as to the degree of adherence to
the Islamic principles among businesses. This is especially so with respect to the use of
vulgar languages and deceptive means in advertising, and the use of celebrities in
advertisements. Those who had the bene?t of having received an Islamic education
(40.3 per cent) are better versed with the requirements of Shariah and Sunnah, and are
thus more equipped in judging whether businesses in Malaysia have complied with the
above in the above aspects of general Islamic marketing practices and promotion.
The respondents viewed that, only a few or some businesses are promoting their
products according to the requirements of Islamic teachings and that the majority of
businesses are violating the Islamic guidelines on promotion, particularly with respect
to the use of celebrities in advertising.
6. Conclusion
The aim of this research study was to ?nd what perceptions Muslim consumers in
Malaysia hold regarding business and marketing practices, especially Islamic marketing
practices. The paramount question addressed is whether Muslim consumers feel
comfortable with the marketing practices carried out by businesses or do the Muslim
consumers feel that Malaysian businesses fall short of following the recommendations of
Islamic marketing. Such information will be useful to both businesses as well as Muslim
consumers in identifying the gap between Muslim consumer expectations and current
business practices with respect to Islamic marketing. Once the gap is identi?ed it will
make it easier for businesses to improve on the present situation.
Findings from this study suggest that there are still many businessmen who do not
observe the marketing practices as outlined in the Quran and Sunnah, particularly in the
promotion of their products, such as, not giving full disclosure of information, use
of exaggerations and vulgar languages and false promises in their attempts to sell
Compliance to
marketing
practices
293
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JIMA
1,3
294
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Compliance to
marketing
practices
295
their products. From the study, the educational backgrounds of the Muslim consumers
were found to affect their level of awareness and perceptions toward the degree of
compliance to Shariah by businesses in Malaysia. Those imbued with religious
knowledge tend to be well-versed with the requirements of Shariah and could judge the
extent to which these are practiced among businesses in Malaysia.
7. Directions for future research
This paper looked at consumers’ perspectives on Islamic guidelines relating to
marketing. The next research, which is already under way will examine the
businessman’s perspective on Islamic guidelines on marketing and practices. It is hoped
that the research will complement the present research and that inferences drawn from
both these researches will be useful in drawing up pragmatic programs in the future, in
order to further educate both consumers and businesses, regarding the full adoption of
Islamic principles in marketing.
References
Abdullah, K. (2008), Marketing Mix from an Islamic Perspective, Pearson Prentice-Hall,
Kuala Lumpur.
Alghazzali, M. (1983), Muslim Character, MWS, Srinagar.
Anwar, M. and Saeed, M. (1996), “Promotional tools of marketing: an Islamic perspective”,
Intellectual Discourse, Vol. 4 Nos 1-2, pp. 15-30.
Hanafy, A.A. and Sallam, H. (1988), “Business ethics: an Islamic perspective”, Proceeding of the
Seminar on Islamic Principles of Organizational Behaviour, IIIT, Herndon, USA.
Kotler, P. and Armstrong, G. (2004), Principles of Marketing, Pearson Prentice-Hall, Upper
Saddle River, NJ.
List of countries by Muslim population (2010), 27 January, available at: http://Wikipedia.org/
wiki/List_of_countries_by_Muslim_population (accessed 30 January 2010).
Rice, G. and Al-Mossawi, M. (2002), “The implications of Islam for advertising messages:
the Middle Eastern context”, Journal of Euromarketing, Vol. 11 No. 3, pp. 1-16.
World Population Stats: Muslim-majority Countries (2009), (4 November 2009), available at:
www.elioe.com/franz/2009world-population-stats-muslims-majority-countries (accessed
30 January 2010).
Further reading
Erfani, M.I. (2005), A-Z Ready Reference of the Quran. Based on the Translation by Abdullah
Yusuf Ali, Goodword Books, New Delhi.
About the authors
KalthomAbdullah is attached to the International Islamic University Malaysia with experience in
lecturing marketing courses such as marketing principles, marketing management,
retail management, consumer behaviour, international marketing, product management,
and promotion management at both the undergraduate and post graduate level. She has
supervised students’ project papers and theses on topics related to consumer behavior and service
marketing. She has published a book titled, Marketing Mix: An Islamic Perspective (2008) with
Pearson Prentice-Hall, which serves as a guide for students taking the basic marketing course.
Kalthom Abdullah is the corresponding author and can be contacted at: [email protected]
JIMA
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296
Mohd. Ismail Ahmad is a Professor attached to the Department of Business with years
of experience in several universities lecturing courses such as marketing principles,
marketing management, international marketing, international business, global marketing
and strategic management. Currently serving as the Director of the Management Center with
full responsibility of managing the post graduate programmes, he has supervised many
postgraduate students, written several research papers and books, among which are, Foreign
Manufacturing Investments in Resource-based Industries: Comparison between Malaysia and
Thailand (1990) and “Businesses in manufacturing, services and ?nance” in Malaysia at 50:
Achievements and Aspirations (2008).
Compliance to
marketing
practices
297
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Marketing plays a very important role in fulfilling consumers' needs, besides achieving company goals. In fulfilling these goals, Muslim marketers must ensure that all aspects of marketing activities, such as planning of goods and services, pricing and distribution strategies, as well as the promotional techniques used, are in accordance with the regulations stipulated in the Quran and the Sunnah.
Compliance to Islamic marketing
practices among businesses
in Malaysia
Kalthom Abdullah
Department of Business Administration,
Kulliyyah of Economics and Management Sciences,
International Islamic University Malaysia, Kuala Lumpur, Malaysia, and
Mohd. Ismail Ahmad
Department of Business Administration, Management Center,
Kulliyyah of Economics and Management Sciences,
International Islamic University Malaysia, Kuala Lumpur, Malaysia
Abstract
Purpose – This research paper aims to explore the perceptions of Muslim consumers of the degree of
compliance of Malaysian businesses to Islamic marketing practices and promotional strategies.
Design/methodology/approach – The perceptions of the Muslim consumers were examined by
distributing a self-administered survey questionnaire to a sample of 450 Muslim respondents residing
in the major towns in Peninsular Malaysia. Items used in the questionnaire were derived from the
basic guidelines provided in the Quran and the Sunnah on the conduct of business practices,
speci?cally on the general marketing and promotional practices used.
Findings – Findings suggest that though there is an awareness of these regulations and practices,
not many businesses in Malaysia are perceived to be complying with them both with respect to general
Islamic marketing principles and with recommended Islamic promotional practices. There was also a
signi?cant difference in opinions expressed by Muslim consumers due to the in?uence of their
religious educational background and the states in which they resided.
Practical implications – There is a need towards more research on how Islamic guidelines could be
applied in all aspects of marketing activities. This could create more awareness among businesses
about the issues and obligations that are relevant in marketing practices.
Originality/value – This research is a rare attempt on the part of researchers and scholars in
Malaysia to relate the Islamic injunctions and guidelines on a speci?c discipline such as marketing.
Although there have been many studies on Islamic ?nance and economics, the area of Islamic
marketing remains clearly under researched.
Keywords Islam, Consumers, Individual perception, Marketing strategy, Promotional methods,
Malaysia
Paper type Research paper
1. Introduction
This study aims to examine the perceptions of Muslim consumers regarding the extent
of compliance of businesses to general Islamic guidelines on marketing and
promotional strategies. In line with this objective, the demographic background of
respondents were examined to determine if any relationship exists between factors
such as age, education background, and place of residence and their perceptions of the
degree of compliance among businesses in Malaysia.
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1759-0833.htm
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Journal of Islamic Marketing
Vol. 1 No. 3, 2010
pp. 286-297
qEmerald Group Publishing Limited
1759-0833
DOI 10.1108/17590831011082446
Being the world’s second largest population after Christianity with 1.57 billion
adherents, Islam comprises 23 per cent of the world population (List of countries by
Muslimpopulation, 27 January 2010). In Malaysia, a sizeable proportion (60.4 per cent) of
Malaysia’s population, which stands at 27.73 million for the year 2008 are Muslims
(approximately 16,748,920). This makes Malaysia number 13 in the world’s most densely
Muslim populated countries (2009 World Population Stats – Muslim – majority
Countries, November 2009). Thus, a studyof this nature is veryimportant to determine the
level of awareness of Islamic injunctions among the predominantly Muslim community.
Through a survey of a sizeable convenience sample of Muslimadults within Peninsular
Malaysia, this study hopes to ?nd and explain differences if any, in the perceptions of
Muslim consumers with regards to the adherence to Islamic principles and practices by
businesses with respect to their general marketing strategies and promotional activities.
The main focus would be on the in?uence of religious knowledge possessed by the
respondents and the states in which the respondents resided. It is hypothesized that the
more Islamic knowledge a respondent possesses the more equipped he or she will be in
evaluating whether the Islamic guidelines are adhered to. In addition, since it is observed
that there are differences inthe awareness level of the Shariahknowledge andrequirements
in the conduct of daily life and business activities based on the state one resides in, this
study intends to ?nd the effect of this factor on the perceptions of respondents towards
compliance by businesses to Islamic guidelines.
2. Review of literature
Marketing plays a very important role in ful?lling consumers’ needs, besides achieving
company goals. In ful?lling these goals, Muslim marketers must ensure that all aspects
of marketing activities, such as planning of goods and services, pricing and
distribution strategies, as well as the promotional techniques used, are in accordance
with the regulations stipulated in the Quran and the Sunnah.
Islamic guidelines ensure that the interest of all parties in a transaction, that is, the
buyers, sellers, business partners and the community are safeguarded. As such,
Muslim businesses are able to maintain a balance between their responsibilities to the
company in terms of pro?ts, to the consumers in terms of providing safe and quality
products, and towards ensuring the welfare of society.
Hanafy and Salam (1988) outlined six categories of ethical principles that can be
applied to marketing activities. These are the principles of truthfulness, trust, sincerity,
brotherhood, science and technology and justice. All aspects of communication to the
consumers, whether through advertising or personal selling, must be done in a truthful
manner without any intentions of misleading them or cheating them. A marketer must
uphold the trust Allah (swt) has in him through proper management of the resources
bestowed upon him for the betterment of society and the surrounding environment.
There must be sincerity in ful?lling consumers’ needs and ensuring consumer safety,
as well as having a sense of brotherhood in dealing with business partners and
consumers. This would not only ensure success in business but would also uphold the
con?dence and loyalty among consumers. Finally, the concept of justice could be
upheld in ensuring that all dealings are conducted with fairness to all parties, for
example, in pricing products.
The purpose of promotionis to informpresent andpotential customers about existing
or new products and/or services, to persuade customers to change their behavior in
Compliance to
marketing
practices
287
terms of product trial or purchase, to develop favourable attitudes towards the product,
brand or company, or to remind customers about the product’s bene?ts (Kotler and
Armstrong, 2004). These objectives are achieved using various promotional tools, such
as advertising, sales promotion, events, public relations, publicity, personals selling and
direct marketing. The bene?ts of these promotional activities can bene?t the economic
progress and social development of a society by encouraging healthy competition,
providing more choices for customers, and enhance moral conduct among others
(Anwar and Saeed, 1996). However, promotional activities should not propagate
overspending or wasting of natural resources through unnecessary packaging, for
example.
Rice and Al-Mossawi (2002) applied the Islamic value dimensions such as,
communication style, honesty of communication, appreciation of diversity of human
race, justice and fairness, role of women, consumption behavior, modesty, and care for
the environment to advertising strategies. These dimensions are categorized into four
cultural dimensions of relationships with people, time orientation, human nature
orientation and activity orientation. The authors provided a thorough framework for
marketing managers in their attempt to develop advertising campaigns that are in-line
with the Islamic teachings.
Since, one of the purposes of the promotional tool of advertising is to inform or
educate the consumers, it is pertinent that the information disseminated encourages
good deeds by depicting Islamic behaviors of respect for the elderly, family bonding as
opposed to messages that encourage reckless driving, unnecessary spending, and free
mixing of males and females. It is stated in the Quran, “Let there arise of you a group of
people inviting to all that is good (Islam)enjoining Al-Ma’ruf and forbidding Al-Munkar
and it is they who are successful [. . .] (A
ˆ
l-Imran 3:104). Prophet Mohammad (pbuh) said:
“I have been sent only for the purpose of perfecting good morals.” When asked “Which
Muslimhas the perfect faith?” The Prophet (pbuh) answered: “He who has the best moral
character”(Alghazzali, 1983). Thus, all advertising messages that follow the Islamic
teachings propagate good moral, such as women in decent manner and clothing,
assuming their role as a positive contribution to the family and society as a whole as
opposed to being used as objects of sexual desire (Rice and Al-Mossawi, 2002).
A promotional appeal that propagates wasteful spending on unnecessary things
through the various special price offers is against the teachings of Islam that fosters
moderation both in spending and saving. However, price discounts offered by retailers
that could bene?t consumers in terms of saving money on items on sale are encouraged
(Abdullah, 2008). It is stated in the Quran, “Those who, when they spend, are not
extravagant and not niggardly, but hold a just (balance) between those (extremes)”
(Al-Furqan-25:67).
With regards to public relations activities directed towards the community, events
such as collecting donations for a charitable cause such as helping victims of natural
disasters, or building an orphanage would be major contribution for social welfare
and is a form of sadaqah. Provided that the manner of hosting such events are in
conformance to the Islamic code of conduct, these acts are considered as ful?llment of
social responsibility which is encouraged in the Quran “Those who rehearse the Book
of Allah, establish regular Prayer, and spend (in charity) out of what We had
provided for them, secretly and openly, hope for a Commerce that will never fail.”
(Faˆtir 35:29).
JIMA
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288
3. Purpose and rationale
The main purpose of this study is to examine the degree of compliance to Islamic
guidelines among businesses in Malaysia in their marketing and promotional strategies.
Data were gathered from a sample of Muslim consumers to examine their perceptions
towards the practices of businesses, and whether their religious background and their
place of residence have any in?uence upon their awareness of Islamic guidelines
governing business practices.
4. Method
In this study, the perceptions of the Muslim consumers towards the promotional
practices of companies were examined by distributing a self-administered survey
questionnaire to a sample of 450 Muslim respondents residing in the major towns in
Peninsular Malaysia. The completion of the structured questionnaires was supervised
by enumerators to ensure that all questions and instructions were understood. The
survey generated a suf?ciently high response rate of 88 per cent which allows for the
reliability and generalisability of the ?ndings to the perceptions of most of the Muslim
consumers in Malaysia. Items used in the questionnaire were derived from the basic
guidelines provided in the Qur’an and the Sunnah on the conduct of business practices,
speci?cally on the general marketing and promotional practices used.
A structured questionnaire containing the statements on the practices of businesses
was used whereby respondents were asked to evaluate howmany companies adhered to
the Islamic guidelines, based on their perceptions. The ?rst part of the questionnaire
contain statements on general marketing practices related to whether Muslim
companies generally conduct their business activities according to the Shariah, whether
“fair” dealings was applied in the transaction of business activities, the extent to which
Muslim businesses follow the guidelines set in the Shariah, and whether non-Muslim
companies made any attempt at following the Shariah guidelines in their marketing
activities. The second part of the questionnaire focused on the promotional perspectives.
In this regard, respondents were required to indicate their agreement on statements
related to disclosure of truthful information to buyers, use of exaggeration and making
false promises to buyers, exploitation of women in advertisements, exaggeration and
deceptive practices, and use of celebrities in the advertising messages. The degree to
which businesses adhere to the Islamic principles was measured by indicating the scales
in percentages in the questionnaire; less than 25 per cent (fewbusinesses), 26-50 per cent
(some businesses), 51-75 per cent (majority of businesses), and 76-100 per cent (almost all
businesses).
5. Results and discussions
Data collected for this study were analyzed using descriptive statistical technique.
An analysis of the demographic data of the respondents indicates that more than half of
the respondents were females (54.8 per cent), and between the ages of 20-39 years old
(52.3 per cent). Most of the respondents were married (73.8 per cent) with more than
half (58.2 per cent) having one to six children. In terms of the educational background,
it was further indicated that 40.3 per cent of the respondents have background
education in Islamic studies with a certi?cate (25.8 per cent), a diploma (7.0 per cent),
and a degree (7.5 per cent). With respect to job category, it was found that 64.3 per cent
of the respondents were employed either in the government or private sector.
Compliance to
marketing
practices
289
Through an analysis of the states in which the respondents resided, it was found that
nearly half (48 per cent) were fromthe western regions of Perak, Selangor, Kuala Lumpur,
and Putrajaya, followed by those from the eastern regions of Kelantan, Trengganu and
Pahang (30.8 per cent). Those fromthe northern regions of Kedah, Perlis, and Penang; and
the southern region of Johore, Negri Sembilan and Malacca contributed only 13.1 per cent
and 8.3 per cent of the respondents, respectively, (Table I).
The pro?le of the respondents indicated that the sample of respondents who
participated in this survey are mostly educated adults with either conventional education
together withIslamic educationandthus are well aware of, or conscious of the requirements
of general marketing and promotional activities as expected in Islam. Thus, their
observations andtheir resultingresponses to the statements onthe promotional practices of
companies and the role of the government in regulating these practices are relevant.
The responses of the respondents to statements listed in the questionnaire are
tabulated in Table II. In terms of the general marketing practices, the ?ndings of this
study indicate the following:
Demographic Frequency (400) Percentage
Gender
Male 181 45.3
Female 219 54.8
52.3
Age-group
20-39 209 45.0
40-60 180 2.8
Above 60 11
Marital status
Not married 105 26.3
Married 295 73.8
Number of children
No children 114 28.5
1-3 children 116 29.1
4-6 children 116 29.1
More than six children 54 13.5
Education
No formal education 93 23.3
Certi?cate in Islamic studies 103 25.8
Diploma in Islamic studies 28 7.0
Degree in Islamic studies 30 7.5
Others 146 36.5
Employment status
Government employee 167 41.8
Private sector 92 23.0
Own business 45 11.3
Retired 24 6.0
Others 72 18.0
Regions
Northern (Kedah, Perlis, Penang) 52 13.1
Southern ( Johore, Negri Sembilan, Malacca) 33 8.3
Western (Perak, Selangor, Kuala Lumpur, Putrajaya) 192 48.0
Eastern (Kelantan, Trengganu, Pahang) 123 30.8
Table I.
Pro?le of respondents
JIMA
1,3
290
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Table II.
Descriptive analysis on
responses to statements
Compliance to
marketing
practices
291
.
Statement 1. A total of 87.3 per cent of the respondents perceived that only a few
(less than 25 per cent) and some (25-50 per cent) of the businessmen in Malaysia
observe the Islamic guidelines in their business activities.
.
Statement 2. A total of 82.8 per cent of the respondents perceived that only a few
(less than 25 per cent) and some (25-50 per cent) of the businessmen in Malaysia
practice fair dealings in their business activities.
.
Statement 16. A total of 71.1 per cent of the respondents perceived that only
a few (less than 25 per cent) and some (25-50 per cent) of the Muslim businessmen
in Malaysia conduct their marketing activities according to the Islamic guidelines.
.
Statement 17. Atotal of 84.8 per cent of the respondents perceived that only a few
(less than 25 per cent) and some (25-50 per cent) of the non- Muslimbusinessmen in
Malaysia conduct their marketing activities according to the Islamic guidelines.
From the responses on the question pertaining to the marketing practices of Muslim
and non-Muslim businessmen, ?ndings suggest that most respondents perceive that
even though there is an awareness of the regulations stipulated in the Quran and
Sunnah, not many businessmen (few and some) in Malaysia observe them in their
business activities. This is evident in the high percentage of respondents who indicated
that not many businessmen observed the practices outlined. In terms of the
promotional practices, the ?nding of this study indicates the following:
.
Statement 11. Atotal of 63.8 per cent of the respondents perceived that only a few
(less than 25 per cent) and some (25-50 per cent) of the businesses in Malaysia give
full disclosure about their products to buyers by providing true information.
.
Statement 12. A total of 58.8 per cent of the respondents perceived that only a
few (less than 25 per cent) and some (25-50 per cent) of the businesses in
Malaysia gave truthful disclosure about their products. Instead, more than half
of the respondents have the opinion that these businesses exaggerated and made
false promises regarding the products.
.
Statement 13. A total of 90 per cent of the respondents perceived that majority
(more than 50-70 per cent), and most (more than 75 per cent) of the businesses are
using women (stereotyping) in their advertisements.
.
Statement 14. A total of 77 per cent of the respondents perceived that few (more
than 25 per cent) and some (25-50 per cent) of the businesses in Malaysia are
following Islamic guidelines on advertising with respect to the use of vulgar
languages, exaggeration and deceptive means.
.
Statement 15. A total of 70 per cent of the respondents perceive that many
businesses (more than 50 per cent and most (more 75 per cent) of businesses in
Malaysia are following the Islamic guidelines, regarding the use of celebrities
in their advertising.
From the promotional perspectives, it can be seen that not many Muslim businesses in
Malaysia are perceived to be following the Islamic guidelines with regards to giving full
disclosure of information about their products. Further, these businesses are perceived
to exaggerate the bene?ts of their products, make false promises to customers, as
well as use vulgar languages and resort to deceptive means to promote their products.
JIMA
1,3
292
These are certainly not recommended as good Islamic marketing practices.
Additionally, many companies are seen to be using women as stereotypes in their
advertising and using women to endorse their products. Again, these are practices that
are not within the boundaries of Islamic guidelines.
A cross-tabulation analysis done between the demographic factors and the
responses to the statements indicated mixed ?ndings in the relationships between
these variables. There are no signi?cant relationships between age and gender and the
statements except for education and place of residence. It was indicated from Table III
that for statements on general marketing practices, there was a signi?cant relationship
between statement 1: “businesses activities in Malaysia are conducted according to
Islamic guidelines and regulations” and educational background ( p ¼ 0.018). The same
?nding was obtained for the relationship between statement 17: “non-Muslim
businesses generally follow and practice Islamic guidelines in their marketing
activities” and gender ( p ¼ 0.087), and state of residence ( p ¼ 0.019). For promotional
practices, there was a signi?cant relationship between statement 11: “businesses
are following Islamic guidelines regarding disclosure of information to buyers” and
state of residence where p ¼ 0.027, statement 12 “businesses are following Islamic
guidance regarding disclosures to customers” where p ¼ 0.049, and statement 14:
“businesses are following Islamic guidelines on advertising (no vulgarity, no
deception) and educational background” where p ¼ 0.052.
It can be concluded that the religious background of the respondents do have an
in?uence on the perceptions of the Muslim consumers as to the degree of adherence to
the Islamic principles among businesses. This is especially so with respect to the use of
vulgar languages and deceptive means in advertising, and the use of celebrities in
advertisements. Those who had the bene?t of having received an Islamic education
(40.3 per cent) are better versed with the requirements of Shariah and Sunnah, and are
thus more equipped in judging whether businesses in Malaysia have complied with the
above in the above aspects of general Islamic marketing practices and promotion.
The respondents viewed that, only a few or some businesses are promoting their
products according to the requirements of Islamic teachings and that the majority of
businesses are violating the Islamic guidelines on promotion, particularly with respect
to the use of celebrities in advertising.
6. Conclusion
The aim of this research study was to ?nd what perceptions Muslim consumers in
Malaysia hold regarding business and marketing practices, especially Islamic marketing
practices. The paramount question addressed is whether Muslim consumers feel
comfortable with the marketing practices carried out by businesses or do the Muslim
consumers feel that Malaysian businesses fall short of following the recommendations of
Islamic marketing. Such information will be useful to both businesses as well as Muslim
consumers in identifying the gap between Muslim consumer expectations and current
business practices with respect to Islamic marketing. Once the gap is identi?ed it will
make it easier for businesses to improve on the present situation.
Findings from this study suggest that there are still many businessmen who do not
observe the marketing practices as outlined in the Quran and Sunnah, particularly in the
promotion of their products, such as, not giving full disclosure of information, use
of exaggerations and vulgar languages and false promises in their attempts to sell
Compliance to
marketing
practices
293
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Table III.
Summary of results of
cross-tabulation between
demographic pro?les and
variables
JIMA
1,3
294
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Table III.
Compliance to
marketing
practices
295
their products. From the study, the educational backgrounds of the Muslim consumers
were found to affect their level of awareness and perceptions toward the degree of
compliance to Shariah by businesses in Malaysia. Those imbued with religious
knowledge tend to be well-versed with the requirements of Shariah and could judge the
extent to which these are practiced among businesses in Malaysia.
7. Directions for future research
This paper looked at consumers’ perspectives on Islamic guidelines relating to
marketing. The next research, which is already under way will examine the
businessman’s perspective on Islamic guidelines on marketing and practices. It is hoped
that the research will complement the present research and that inferences drawn from
both these researches will be useful in drawing up pragmatic programs in the future, in
order to further educate both consumers and businesses, regarding the full adoption of
Islamic principles in marketing.
References
Abdullah, K. (2008), Marketing Mix from an Islamic Perspective, Pearson Prentice-Hall,
Kuala Lumpur.
Alghazzali, M. (1983), Muslim Character, MWS, Srinagar.
Anwar, M. and Saeed, M. (1996), “Promotional tools of marketing: an Islamic perspective”,
Intellectual Discourse, Vol. 4 Nos 1-2, pp. 15-30.
Hanafy, A.A. and Sallam, H. (1988), “Business ethics: an Islamic perspective”, Proceeding of the
Seminar on Islamic Principles of Organizational Behaviour, IIIT, Herndon, USA.
Kotler, P. and Armstrong, G. (2004), Principles of Marketing, Pearson Prentice-Hall, Upper
Saddle River, NJ.
List of countries by Muslim population (2010), 27 January, available at: http://Wikipedia.org/
wiki/List_of_countries_by_Muslim_population (accessed 30 January 2010).
Rice, G. and Al-Mossawi, M. (2002), “The implications of Islam for advertising messages:
the Middle Eastern context”, Journal of Euromarketing, Vol. 11 No. 3, pp. 1-16.
World Population Stats: Muslim-majority Countries (2009), (4 November 2009), available at:
www.elioe.com/franz/2009world-population-stats-muslims-majority-countries (accessed
30 January 2010).
Further reading
Erfani, M.I. (2005), A-Z Ready Reference of the Quran. Based on the Translation by Abdullah
Yusuf Ali, Goodword Books, New Delhi.
About the authors
KalthomAbdullah is attached to the International Islamic University Malaysia with experience in
lecturing marketing courses such as marketing principles, marketing management,
retail management, consumer behaviour, international marketing, product management,
and promotion management at both the undergraduate and post graduate level. She has
supervised students’ project papers and theses on topics related to consumer behavior and service
marketing. She has published a book titled, Marketing Mix: An Islamic Perspective (2008) with
Pearson Prentice-Hall, which serves as a guide for students taking the basic marketing course.
Kalthom Abdullah is the corresponding author and can be contacted at: [email protected]
JIMA
1,3
296
Mohd. Ismail Ahmad is a Professor attached to the Department of Business with years
of experience in several universities lecturing courses such as marketing principles,
marketing management, international marketing, international business, global marketing
and strategic management. Currently serving as the Director of the Management Center with
full responsibility of managing the post graduate programmes, he has supervised many
postgraduate students, written several research papers and books, among which are, Foreign
Manufacturing Investments in Resource-based Industries: Comparison between Malaysia and
Thailand (1990) and “Businesses in manufacturing, services and ?nance” in Malaysia at 50:
Achievements and Aspirations (2008).
Compliance to
marketing
practices
297
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