The Halal Mega Trend

5th International Halal Market ConferenceJune 5th- 6th, 2010Brunei DarussalamBy Ayman Hamed- Marketing DirectorAl-Islami Foods

Agenda

IV- Taking it Global

I- Finding our Bearing ?

II- Remaing Focused ?

III-Putting it Together ?

I- Finding our bearing,

How Did We Get Here?

Cultural Diversity

In South

East Asia (Moslems,

Buddhists, Hindus, Christians)

Fraudulent &

Opportunistic

Practices In The Middle East

The Opportunity• Global Halal Food Business

Valued at US$580 Billion (Source: Euro monitor)

• Current & Relevant Target Audience of Muslims of 1.8 Billion

• Islam The Fastest Growing Religion In The World

• Halal Food Products Estimated To Constitute 20% of Total Food Value by 2025

• Extended Middle Eastern Region Also Characterized By The Youngest Population

Value is Created, Now Who Will

Capture The Value?

Which Countries Are Benefiting The MostFrom This Growth?

By in large the leading countries can be described as :

Western, Non Muslim, Industrialized

Australia

USA

Canada

UK and EU

Brazil

India

What Other Countries Are Now MovingInto Position

Countries that will succeed in penetrating the Global Halal Market will be those that pay attention to the details of, standards, branding and marketing &Collaborate with others.

Malaysia

Thailand

Brunei

Singapore

China

Philippine

Turkey

UAE

Which Companies Have Recognized the Opportunity!

By in large those that have first mover advantage are Multinationals:

Nestle

McDonalds

KFC

TESCO

Aussie Beef

New Zealand Lamb

What Other Food Industry Is Benefiting From The Trend?

• Market : Kosher Foods In The US*• Market Size: $100 Billion• Population : 5-6 Million Jews• Products : 86,000 product range• Consumer profile

15% Jews (5% Strict)55% Health Conscious38% Vegetarian24% Dairy-free

• To get a clearer perspective

For Every 1 Halal Product … …….there are 86 Kosher• US Moslems are spending

$16Billion a year on Kosher Products, due to lack of Halal products(*Source: Mintel)

News FlashAlmost half of US S/M products are kosher*

“At least 20,000 kosher certified items, and in many stores the number of kosher products is closer to 25,000 – which is nearly half of all items on supermarket shelves. Up to 125,000 kosher items available. Products such as Gatorade gain kosher certification. Categories, such as coffee, tea & cereals, are virtually all kosher”

a new survey by KosherToday.

Composition of the $580 Billion HALAL Market

Africa$115 Billion

Middle East$111 BillionS. America

$1 Billion

China$ 5

Billion

Europe (Inc.

Russia)$65 Billion

S. E. Asia$ 95 BillionN. America

$15 Billion

Central & South Asia$175 Bil

(*Source: Euromonitor)

Australia & NZ

$1.5 BillionMiddle East = 19% Of World Value

What Gives Them The Advantage?

What has given countries, companies & Kosher foods the advantage, is what has traditionally be their advantage

Quality Food Production

Standards

Branding and Marketing

Access to Capital

Control of Distribution and Supply Chain Networks

II. How Islami remain focused ?

Who Is Al-Islami ?

Vision: To Become A Global Food Brand By Leading The Agenda On The Emergence of ‘Halal’ As A Global Mega Trend And Capturing The Imagination of Food Lovers Around The World

Mission: To Provide Authentic Halal Food With The Highest Standards Of Quality and Health, Thus Emerging As A Role Model For All Food Providers Around The WorldAim: To be AED 1 Billion by 2013

History : Dubai Coop society born in 1971 by Hajj SaeedLootah. In 1981 launched brand Co-OP Islami to ensure genuine supply of Halal food. Starting with Frozen whole chicken, followed by processed products.

Halal for Al Islami Foods Is Not A Trend, Or a Variant, Or Part of Our Business

IT IS OUR BUSINESS!!!

Good to Remember……

Why Al-Islami ?

Stringent Sharia’a’ & Quality Complianc

e

1st, truly Regional Halal Brand

Our Brands

Regional Manufact

uring

Meeting Consume

r Lifestyle

Global Sourcing

Our Corporate Strategies(The Big Five)

Build a powerful, local, regional & global “Halal” brand

1

Drive expansion through innovation(In Formula, Packaging, Benefits, channels etc.)5

2Develop a brand led organization

Aggressively expand geography(in every category)4

3 Increase our total market share (Existing Geographies, Concepts,

Categories & Channels)

Invest heavily in ATL & BTL

Dominate the Category SOV

Expand New Concepts such as Meat Shop, Cart & Farooj

Re Launch in KSA &Europe

Based on Better Consumer Understanding Develop

new Food solutions

Communication Evolution of Al- ISLAMI Brand

Functionality (HALAL)

Lifestyle/convenience

1. Emphasis on HALA as real Differentiator

2. Emphasis on Benefits

“Healthier, Nutritious &

Tastier

3. Going beyond the

trade-off of Functionality & Convenience to

Bonding (Universal Values)

1. Halal Interruption : Emphasizing What Is Real Halal (Functional2. Halal Intrusion: Emphasizing Tangible Benefits (added value3. Halal Engagement: Emphasizing Universal Values (Motherhood)

BuildA Powerful, Local, Regional & Global “Halal” Brand 1

Interruption IntrusionEngagement

Functional

BuildA Powerful, Local, Regional & Global “Halal” Brand

1

Benefits & Lifestyle

Bonding

BuildA Powerful, Local, Regional & Global “Halal” Brand

1

2Develop A Brand Led Organization

Expected SOV for 2010 will be around 60% of the total Frozen meat category

60%

40%

Islami Others

3Increase Our Total Market Share (Existing Geographies, New Product, Categories & Channels)

Dubai

Aggressively Expand Geography(in every

category)42013 Geographic Scope

Improved Consumer Understanding (Ladder of Features & Benefits)

Emotional Aspect

Functional Aspects

Healthier lifestyles, happier

lives.

Healthier, tastier meals.

No Hormones, less fat, 100% grain fed

Real halal, (Hand slaughtered, no stunning, Al

Islami representative)

Launch a host of new complimentary and novel products

Drive Expansion Through Innovation

(It could be Formulas, packaging, Benefits, channels etc.)

5

III. How Islami is putting it together

SUPPLY CHAINThe Engine of Corporate Value Creation

But How to Capture Value ?

Willingness To Pay

Willingness To Supply

Cost of Sales

Sales Value

Value Capture

DifferentiationActivationInnovationTrading TermsOverheadsPartnershipsBusiness SystemManaging EcosystemSupply Chain CostsManaging Exit Effectively

Me Too ProductsPoor Market ActivationSubstitutesGreysRetail ConcentrationDistributor GapsWrong Business SystemLegislation (Duties)Inefficient ProcessesHeavy Competition

The Value Creation

PLAN•Farm•Annual Planning•Innovation Ideas•Market Development•Negotiation Strategy•Pricing Strategy•Marketing Strategy•Target Audience•Consumer Insights•Sales Strategy

SOURCE & PROCURE•Raw Material •Slaughtering•Additives•Ingredients•Supplier Negotiations•Agency Selection•Human Resources•Government Accreditation•Packaging•Endorsements

MAKE•Processing•Preliminary Operations•Conversion Operation•Preservation Operation•Product Development

•Contract Packing •Supplier Management•Advertising Production•Media Buying•Cash Management

DELIVER•Warehousing•Finished Goods•Distribution Coverage•Distributor Storage•Shipping Agents•Logistics •Transportation•Media Execution•In Store Execution•Sales Operations•Customer Care

Driving Value Creation ObservationSlaughtering Process

Fundamental To Company Philosophy & Value Creation

Highly Complex Procurement & Negotiation Strategy (Multiple Suppliers / Channels / Worldwide Sourcing Network / Halal Inspections)

Dual Go To Market Chain Inclusive of a. Procurement of Finished Product &b. Local Manufacturing

Management of Cash to Fuel Growth Vital Ingredient to Sustainable Success

The Value Capture

Channel Mgt•Showcasing Offer (Push)•Hypermarket•Supermarket•Self Service•Grocery• Impulse Channels•Retail Store•Wholesale•Restaurants•Leisure Outlets•Online•Direct Marketing•Shop in Shop•Showcasing Offer (Pull)

Marketing•Advertising Radio•Advertising Digital•Advertising B2B•Advertising Direct Mail•Merchandising•Sponsorship•Endorsements•Accreditations•Sampling•Promotions•Loyalty

Customer•Reach (Media)•-Channel Selection•-Program Selection•-Readership Profile•-Digital Profile•-Habits & Attitudes

•Reach (Purchase Point)•-Sampling•-Promotions•-Store Profiling•-Location•-Demographics•Customer Care

Loyalty• -Helpline•-Website•-Serving Suggestions•-Maintenance•-Clubs / Associations•-Blogs•-Tips / Advice•-Loyalty Cards

From Farm To Food Inspiration Observation

Business Has Articulated The Go To Market Model Throughout The Value Chain

The Company Philosophy Dictates The Value Creation Component

The Marketing Story (Real Halal) Drives The Ability of The Company To Capture Value

Full Integration Of The Entire Organization KEY to Sustainable Success (Product / Format / Systems / Geographies)

IV- How to Take it Global ?3S’s & 3P’s

Where Do We Go From Here?

Submission

(Ta’ah)

Sincerity

(Ikhlas)

Sacrefice

(Tadh’heya)

We need to Balance between the two demands 1. The Heavenly (3S’s)2. The Earthly(3P’s)

Where Do We Go From Here?

Profit

Product(Differentiation)

Patronage(Loyalty)

We need to Balance between the two demands 1. Heavenly (3S’s)2. Earthly (3P’s)

Where Do We Go From Here?

Profit

Product(Differentiation)

Patronage(Loyalty)

Submission

Sincerity

Sacrefice

We need to Balance between the two demands 1. Heavenly (3S’s)2. Earthly (3P’s)

Get Well Soon (Diabetes & Obesity, Kids’ Health, Food Safety, Women’s Health, Allergies & Immunity, Well-Being, Energy)

2

Top Trends in Food Processing(And their mini-trends)

Organic = Healthy (Non-GMO, Fair Trade, Sustainability, Regional, Minimalism, “Natural”)1

3 Age Awareness

(Aging, Teens, Kids)

Control Yourself (Serving (Size, Convenience, On the go)4 Eat Global, Buy Local (Ethnic Flavors, Multinational Production Regulations)5 Kosher/Halal (Food safety, Certification, Oversight, Spiritualism)6

One take Out OnTrendSlide

Organic = Healthy

Get Well Soon

Be Ware Of Your Age

Control Yourself

Eat Global, Buy Local

HALAL

Trend Multiplier/ Accelerator** One of the reason Kosher Foods Took off in 2004

Where we go from here?

Master The Supply/Value

Chain Farm to Food

Build A Brand +

Halal

All brands made of products/services, but not all products are brands !

Build A Global Halal

Cooperative/BoardA body that will advance

the Halal Agenda globally

3 key Ingredients to Success

Master The Supply/Val

ue ChainFarm to food

Build A Brand +

Halal

All brands made of products/services, but not all products are brands !

Build A Global Halal

Cooperative/BoardA body that will advance

the Halal Agenda globally

3 key Ingredients to Success

Build A brand

• “In technocratic and colorless times, brands bring warmth, familiarity and trust.”-Peter Brabeck, Former CEO Nestle

• “The art of marketing is the art of brand building. If you are not a brand, you are a commodity. Then price is everything and the low-cost producer is the only winner.”- Philip kotler, kellogg “

Halal

3 key Ingredient to Success

Product Vs. Brand

Physical Space Clutter Is Extending Into The Mental Space

A Process That combines Short Term & Long Term Planning

Value

Years

2. Plan for three Years Grows

Channel

3. Planning For

Decades Grows Brand

Building A Brand

Channel

Sale

BRAND1. Planning for One year grows sales

A Word Of Caution :The Propeller Effect Vs. The Elevator Principle

The Brand

The Communication

Th

ePro

duct

The Packaging

• Every Thing You Do Pulls The Brand In Different Directions

The Brand

TheCommunication

Th

e

Pack

agin

gTh

e

Pro

duct

• Every Thing You do Adds To The brand

What is The Right fit?

Brand Strategy Corporate Strategy

SO……. How Can we give Halal Brands extra lift ?

To Give Halal Brands Extra Lift….

Organic = Healthy

Get Well Soon

Be Ware Of Your Age

Control Yourself

Eat Global, Buy Local

HALAL

Trend Multiplier* One of the reason Kosher Foods Took off in 2004

Example Of Trend Multiplier/Accelerator

HALAL BrandsPotential TrendMultipliers/Accelerators

•Organic

• Fair Trade

•Animal Welfare(Free Range)

• Environmentally Friendly(Biodegradable)

Master The Supply chain

“If you want to grow your way to greatness, put value creation first”

- Ken Favaro

Halal

3 key Ingredient to Build Halal

Value Chain Is a connected series of organizations resources and knowledge streams involved in the creation and delivery of value to end customers

Build A Global Cooprative

The World Gold Council’s mission is to stimulate and sustain the demand for gold and to create enduring value for its stakeholders

- The World Council

From agricultural, fiber and textile research, market information and technical services, to advertising and public relations, fashion forecasts and retail promotions, we keep one goal in mind: To ensure that cotton remains the first choice among consumers in apparel and home products.

- Cotton Inc

Halal

3 key Ingredient to Build Halal

In Summery

Halal Is A Mega Food-trend That Will Make Nearly 20 % of all food sold by 2025

Al-Islami Foods has Articulated it Go-To-Market Business Model

Supply Chain is the Engine of Value Creation

3 key Ingredients to Success1. Building A Brand (Not a product)

2. Mater the Supply Chain/Value Creation

3. Create A Global Halal Board

Foods For Thoughts

Gee! Does this mean every new product needs to be an organic, whole-grain, 100-calorie, ethnic-oriented and Halal snack loaded with omega 3s and anthocyanins with an easy-open top and large-

Print Labels !

• Indication Are Such a product would sell well

As long as we remember , when it comes to food, Taste comes on top any

trend

Thank you

• Wider Range

Upgrading The HALAL Proposition?

• Global Halal Certification

• Better packaging

• Consistent Supply• Professional Audit

• Better Quality