MARKETING MIX MANAGEMENT FROM AN ISLAMIC PEERSPECTIVE: SOME INSIGHTS Presented by: Professor Muhammad A.

Al-Buraey Professor of Management CIM, KFUPM, Dhahran, S.A. Victoria Management School August 2007

INTRODUCTION

Marketing is a means of communication between customers and organization. Marketing focuses on identifying, anticipating and satisfying customer needs. It is an effective tool through which customers desire are explored through advertising and promotions.

False marketing trends has brought negative aspects in the social culture and created too much materialism which is not in harmony with the business ethic.
A strong need arises and calls for how to change the current marketing trend and introduce a new technique which constitute marketing practices based on Islamic ethic, and social culture. The objective of this paper is simply to suggest marketing practices from an Islamic viewpoint.

The first objective of this paper is to introduce marketing rules and regulations based on the Holy Quran and Islamic Shariah. The second objective to present a real case study and examine the application of Islamic framework in marketing management practices.

MARKETING IN ISLAM

At the beginning it is appropriate to make clear that Islamic approach in the business is based on spiritual belief. Successful tycoons should not challenge these Islamic values irrespective of their success in the business.
Islam has developed a code of life dealing in all aspects of life either business, economic or social aspects that should be adhered to under all circumstances.

Islam has laid down basic principles of business strategies. Marketers must serve their goals within the rules and regulations of Islamic Shariah as outlined in the Holy Quran. Islam stressed fair dealing in business. Unfair margin of profits in the business is prohibited in Islam.

MARKETING MIX ISSUES

In Islam, as in modern marketing textbooks, four marketing mix issues have been identified (Difference in practice and behavior not in theory): 1- Product 2- Price 3- Place and 4- Promotion

Product Decisions: The product which is being marketed should be halal and meet all requirements of Islamic law. It is also vital for the processors to process those products which are permissible in Islam and should conform to the environment friendly standards. Islam forbids few commodities and items that are harmful to the community or individual, Prophet (pbuh) said: Dont cause damage, if so, it must be remedied.

It is an obligation of the manufacturers and suppliers that they should provide real and correct specifications of their products. Under no circumstances the marketers hide any drawbacks of their products. Each product must have detailed information about its contents and ingredients as well as dates of expirations. (Abu Hanifah incident)

Pricing Decisions:

Pricing decisions should be formulated according to Islamic concepts and regulations. Some of these can be taken into considerations and should be avoided :
1.. Maisir means getting something easily or getting profit without working hard for it. 2. Tatfif- means changing quality or quantity of the product without changing price. 3. An-Najash: An increase in price by a buyer unwilling to buy to induce others to buy. 4. To buy a commodity after it has been sold to another person.
5. To receive farmers before entering town and buy cheaply their products in order to sell highly.

Pricing Decisions - contd

6. Ihtikar: hoarding or monopolizing a specific good or commodity thus creating

a shortage so that the price would be very high when they sell.

7.

Iktinaz (Collecting and keeping gold and silver and not spending them in the way of Allah.) The Quran specifically warned those (who hoard up gold and silver, and spend them not in the way of Allah, announce unto them a painful torment)

Pricing Decisions - contd

In Islam price the essential conditions of a sound self-operating of price adjustments are as follows: a. Prohibition of Monopoly: It means exclusively control the quantity and price of goods having intention to decrease supplies as a result increase of the price of such goods. Monopoly (or Ihtikar) is forbidden in Islam.

Pricing Decisions - contd

b. Prejudicial and Unreasonable Pricing: Price should not be fixed to deceive buyer or having intention to eliminate competitors. c. Prohibition of Usury and Other Practices The Holy Quran (2:278) clearly forbids usury and discard it; and in (2:279) one can take back the capital sum only: no excess.

Pricing Decisions - contd

Promotion Mix

Promotion means to introduce and present a product to the customer. It includes advertising, personal selling, publicity and sales promotion. To promote any products it is necessary to disclose all of its defects, if any.

Pricing Decisions - contd

Promotion Mix:

Exaggeration in marketing practices is not allowed in Islam. Stereotyping of women in advertising is also objectionable in Islam. Advertising should be in accordance with the Islamic points of view. No fraud, no vulgarity, no lying or deception ; no cheating are allowed throughout the promotion campaign.

Regulations for Promotion: The following are some of the regulations when engaging into promotion activities:
-

Be honest - truthful and free from deception Do not offer any wrongful promise; or promises you cannot keep. Do not use celebrities to deceive customers.

MARKETING PRACTICES FROM AN ISLAMIC PERSPECTIVE

National Biscuit & Confectionery Company (NBCC). NBCC produces and markets biscuits and confectionaries. In 1987 its products comprised of three product lines, a dry biscuits line, cream biscuits line and hollow wafer line. This was followed up with 3 flat wafer lines in 1990, 1992, and 1993.

In 1994 the company launched major diversification into the manufacturing of salted Crisps. Concurrently, lines for the manufacturing of pellet based snacks, extruded snacks and dip sticks were added. Needless to say that all local ingredients that make up the product are Halal.

Promotional Activities

NBCC has been also using various conventional tools of promotion, which adhere to basic ethical principals of business. . The promotional tools can generally be termed as Islamic with some reservation (as will be seen below).

The case of a promotional campaign:

NBCC launched the 'Educational Flippo' (a plastic disc). NBCC launched a campaign in which customers were urged to collect these 'flippo' discs in an album containing five sheets for a total of 100 'flippo' discs. While this campaign was successful, the promotion itself can be questioned from an Islamic perspective, mainly on the following grounds:

'Flippo' discs bear pictures or parts of a body and pictures, which Islam has strong reservations against it. This is also clearly in violation of Islamic ethics and values. Another major concern has been that some children use the disc in a game; a kind of gambling, which is strongly forbidden by Islam. Children, their parents and other customers buy the product not for its value, or use but to collect these discs for the prizes.

CONCLUSION

The purpose of this study was to outline marketing management and suggest ideal practices from an Islamic perspective. Based on the Holy Quran, Islamic Traditions and Shariah Law, the paper suggests a number of ideal marketing practices for managing the decisions related to some elements of the marketing mix namely: product, pricing and promotion. A few suggestions have also been provided to ensure conformity with Islam.