Muslim spending growth to outpace rest of digital economy

SHARE

SHAFAQNA - Dubai Muslim consumers contributed $107 billion to the global digital economy of nearly $2 trillion, and their spending will grow faster than the rest of the digital economy by 2020, a study released on Sunday said.

The report, released ahead of the second edition of the Global Islamic Economy Summit next month, said the contribution of Muslim consumers accounts for 5.8 per cent of the total global digital economy.

The growth in total value of Muslim consumers’ contribution to the global digital economy estimated at a CAGR (compound annual growth rate) of 17 per cent by 2020, is expected to outweigh the growth of the total global digital economy (at a CAGR of 15 per cent in 2020), said the report released by Dubai Silicon Oasis Authority (DSOA) and Thomson Reuters, with support from the Dubai Islamic Economy Development Centre.

Titled ‘Digital Islamic Economy Report’ for 2015, the study was prepared in collaboration with DinarStandard.

The 2015 Global Islamic Economy Summit, to be held on October 5 and 6, is set to gather over 2,000 policymakers, thinkers and business leaders seeking to build a roadmap capitalising on the opportunities within the growing global Islamic economy. The event is being jointly organised by the Dubai Chamber, the Dubai Islamic Economy Development Centre and Thomson Reuters.

According to the report, currently more than 2,000 Islamic lifestyle services are being provided across websites and mobile platforms worldwide. The most popular categories include ‘news and insights’ (used by 21 per cent of users), followed by ‘retail sales’ and ‘media and entertainment’.

Five segments within Digital Islamic Consumer Services have emerged as the most promising Islamic segments, namely sharing economy; social commerce; retail e-Commerce; food transportation and logistics; and Islamic finance investment products.

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

It said the findings of the study indicated that social media services customised for Muslims have proven less successful as business models, especially services pertaining to ‘news and insights’, which typically rely on revenue support from online advertising.

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

“As a leading government entity and key player in the technology industry, the contribution of Dubai Silicon Oasis Authority to this emerging Islamic economy sector will further position Dubai as a hub for the development of electronic information, programmes, applications, projects as well as a platform for e-commerce and Islamic media,’ said Dr Mohammed Alzarooni, vice chairman and CEO, Dubai Silicon Oasis Authority.

Alzarooni said the authority’s mandate to support ‘Islamic digital’ and ‘Arabic content’ initiatives is already making considerable headway. “We are confident this report will benefit individuals and businesses targeting the Islamic economy industry by providing data and insights that can serve as a guideline for them to make more informed decisions.”

The report reaffirms that Islamic digital economy has become an integral part of everyday life and indicates significant opportunity for growth in terms of business and innovation, said Nadim Najjar, managing director of Thomson Reuters, Middle East and North Africa. “We are confident the insights presented by the report will help entrepreneurs and established businesses better navigate this space.”

LEAVE A REPLY

Please enter your comment!
Please enter your name here