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HALAL ECONOMY

Report: The Next Phase of Muslim Travel Report

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Leading Muslim Travel Platform Unveils The Next Phase of Muslim Travel Report, Highlighting The Impact of Inflation, Sustainability And Generative AI On Millennial Muslim Travellers in Southeast Asia

  •  Rising travel costs due to inflation are the top concern for Millennial Muslim travellers in Singapore, Malaysia and Indonesia
  • Change in destination preferences, with increasing interest in travel within Southeast Asia
  • Varied adoption of generative AI across three markets with a lower confidence level in Muslim-specific travel recommendations by generative AI

HHWT launches new product features to enrich the user experience of Muslim travellers

Have Halal, Will Travel (HHWT), the leading travel and lifestyle platform catering to Muslims across Asia, released The Next Phase of Muslim Travel report during its Deep Dive event on Friday, 11 August 2023. This report examines the impact of global trends – inflation, sustainability, and generative AI – on Millennial Muslim travellers within Singapore, Malaysia, and Indonesia.

With a commitment to understanding and addressing the evolving needs of Muslim travellers, HHWT’s Deep Dive series aims to unlock the vast potential of data insights from the key verticals that make up the Muslim market. The company hopes to share knowledge to empower brands and governments to make better decisions when segmenting, targeting and positioning their products and services.

The comprehensive findings of the report shed light on the behaviours and preferences of this influential demographic across the region as a result of global trends. Among the notable insights revealed in the report:

Rising travel costs due to inflation are a top concern across three markets

The escalating concern over rising travel costs emerged as a prominent theme across all three markets. Surprisingly, the report disclosed that 9.9% (Singapore), 11.9% (Malaysia) and 26.7% (Indonesia) of Muslim travellers would spend less on travelling. Furthermore, the majority of respondents expressed a strong inclination to embark on international journeys, with 84% (Singapore), 68.2% (Malaysia) and 48.1% (Indonesia) of Muslim travellers likely to travel internationally in the next 12 months.

Tengku Suzana, co-founder of HHWT, says, “Despite concerns over rising travel costs, there’s still a strong demand and desire to travel among Millennial Muslim travellers. These travellers would rather travel during off-peak periods and plan their trips around enticing travel discounts instead to manage surging costs. This is an opportunity for brands to run campaigns all-year round instead of focusing on peak travel periods. The majority of Millennial Muslim travellers go on trips with their immediate family with kids younger than seven years old, so they would be more flexible to travel any time of the year. At HHWT, we have been highlighting ways that travellers can enjoy value-for-money experiences to get the most out of their trip since the purchasing power is most likely eroded by inflation.”

Interestingly, there is a shift in concerns about contracting Covid-19 while travelling, taking a backseat for all three markets.

Change in destination preferences, with increasing interest in travel within Southeast Asia
Compared to HHWT’s 2022 study, Millennial Muslim travellers preferred destinations within Southeast Asia, except for Japan which ranked first for Malaysian and Indonesian travellers and second place for Singaporean travellers.

Most Millennial Muslim travellers prefer longer trips, with 70% (Singapore), 68% (Malaysia) and 55% (Indonesia) of Muslim travellers indicating that they would go on a trip lasting more than a week.

Varied adoption of generative AI across three markets with a lower confidence level in Muslim-specific travel recommendations from generative AI

An intriguing variance emerged in the adoption of generative AI for travel among the three markets. Indonesian respondents exhibited the highest propensity, with more than half (54.5%) indicating their intent to utilise AI for travel purposes. In contrast, 31.8% of Singaporean and 21.4% of Malaysian Muslim travellers expressed a similar inclination.

“While there is a segment of Muslims who use AI for travel, the confidence level in using AI for Muslim-specific travel recommendations is low. Only 15% of Singaporean and 17% of Malaysian respondents expressed confidence in AI’s ability to cater to Muslim-specific travel requirements,” says Tengku Suzana. “This suggests that Muslims may be hesitant to trust AI regarding faith-related concerns, and AI may not be ready as an immediate replacement for travel planning. This reinforces the continued reliance and importance of platforms like HHWT, which provide information that answers Muslim travellers’ needs to explore the world with ease.”

HHWT launches new product features to enrich the experience of Muslim travellers

HHWT also announced several new product features to extend and enrich the user experience for Muslim travellers. This includes the Destination Page, where users can look forward to guides, curated itineraries, community stories and listings across the Buy, Eat, See & Do, and Stay categories, all in one centralised page.

Brands and partners will stand to gain insights about the performance of their listings via personalised dashboard visualisations, where they can see first-hand the impact HHWT generates for them via the users that consume content on HHWT’s website. This will allow them to make better-informed decisions on the type of content that is more attractive to the users.

“The community is an integral part of HHWT’s new features and we’re excited about this. Users can look forward to the collective experiences of our community who have travelled to many places worldwide,” says Tengku Suzana. “In the upcoming iterations, we will focus on user-generated content in the form of reviews, suggested listings, community stories and videos populated by our community.”

The complete report is available for review and download here.


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HALAL ECONOMY

Muslim-Friendly Tourism is the Next Big Opportunity for Malaysia

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Global Muslim-friendly tourism is projected to contribute significantly to international tourism, with an estimated 230 million Muslim travelers expected to spend around $225 billion by 2028. Recognizing this immense potential, many popular destinations are introducing innovative offerings to attract Muslim tourists. Malaysia, already a preferred destination, stands to benefit greatly from this trend, provided it capitalizes on the opportunity and addresses rising competition from neighboring countries.

Muslim tourists currently make up about 20% of Malaysia’s total tourist arrivals, contributing approximately RM14.7 billion to the local economy in 2023. However, countries like Indonesia, Singapore, and Thailand are aggressively promoting their Muslim-friendly tourism and hospitality (MFTH) products and services, posing a competitive challenge for Malaysia.

In response to the increasing competition and to tap into the vast potential of Muslim tourists, the Islamic Tourism Centre (ITC), under the Ministry of Tourism, Arts, and Culture (MOTAC), is enhancing its efforts to strengthen Malaysia’s position as a top Muslim-friendly destination. ITC has introduced the Muslim-Friendly Tourism and Hospitality Assurance and Recognition (MFAR) and the Muslim-Friendly Tourist Guide (MFTG) programs to ensure the quality of products and services, boost tourist confidence, and open new market opportunities.

Launched in 2019, MFAR is the first government-backed recognition for businesses offering Muslim-friendly services in various areas such as tourist accommodations, spas, medical facilities, travel management, transportation hubs, shopping centers, and entertainment parks. ITC sees these standards as essential for attracting Muslim travelers and enhancing their experience in Malaysia.

Nizran Noordin, ITC director-general, stated, “Just like how Jabatan Kemajuan Islam Malaysia’s (JAKIM) halal certification has been helpful for Muslims in their decision-making regarding food and consumer goods, MFAR aims to provide the same recognition for tourism products and services.” The goal is to optimize tourists’ satisfaction and experience, enabling them to explore Malaysia’s cultural and natural attractions confidently.

The MFAR program not only assures the quality of Muslim-friendly services but also serves as a marketing tool to communicate the availability of amenities such as prayer facilities, halal food, and water for ablution. While emphasizing Muslim-friendly tourism, MFAR recognition does not exclude non-Muslim patrons, ensuring inclusivity.

The MFTG program recognizes MOTAC-licensed tourist guides who have completed ITC’s training and passed assessments on understanding the Muslim tourist market. This initiative aims to enhance the quality of services provided to Muslim tourists.

Malaysia has consistently topped the Mastercard-CrescentRating Global Muslim Travel Index (GMTI) since its inception in 2015. In 2023, Malaysia was named “Muslim-Friendly Destination of the Year” and “Muslim Women-Friendly Destination of the Year” at the Halal in Travel Awards. These accolades highlight Malaysia’s strong transport infrastructure, communication proficiency, ease of entry for travelers, safety, extensive halal dining options, and the availability of prayer places and Muslim-friendly accommodations.

With the upcoming Visit Malaysia Year 2026, the country targets 35.6 million tourist arrivals and RM147.1 billion in receipts. MOTAC aims to position Malaysia as an Umrah hub for Southeast Asia, East Asia, and Oceania, further increasing Muslim tourist arrivals. Nizran Noordin emphasized that the growth of the Muslim tourist market could sustain various sectors such as banking, finance, and insurance through offerings like payment gateways, digital wallets, and travel insurance tailored for Muslim tourists.

To facilitate the application for MFAR recognition, ITC has developed a rating system where businesses can achieve silver, gold, or platinum recognition based on their level of commitment and compliance with the guidelines. Nizran Noordin expressed hope that industry players will adopt these recognitions to provide greater assurance to Muslim tourists, especially as Malaysia prepares to become an Umrah hub.

The potential for Muslim-friendly tourism in Malaysia is immense. By leveraging strategic initiatives and addressing competitive challenges, Malaysia can solidify its position as a leading destination for Muslim travelers, driving economic growth and enhancing its global standing. For the latest updates on Malaysia’s tourism initiatives, follow official announcements from the Islamic Tourism Centre and MOTAC.


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HALAL ECONOMY

Pilgrims Remain Bedrock of Saudi Tourism Plans

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By Andrew Hammond

Saudi tourism is to undergo a massive expansion with religious travellers remaining its bedrock – but some hotel operators are wary of an overheated market.

The kingdom is aiming to bring in 150 million visitors per year by 2030, with tourism accounting for 10 percent of non-oil GDP, playing a key role in its economic transformation plan valued at $1.25 trillion.

The Saudi Tourism Authority displayed the country’s offerings – from the futuristic luxury resorts in Neom, to wellness holidays in AlUla and mountain climbing in Aseer – at this year’s Arabian Travel Market in Dubai. 

The plans include an additional 320,000 hotel rooms by 2030 according to property consultant Knight Frank, with more than half of them expected to be in the holy cities of Mecca and Medina.

“Knight Frank’s analysis of hotel supply in Mecca and Medina reveals a significant figure of 221,000 hotel rooms announced, planned or under construction,” said the consultancy. Super-rich Muslims are also seeking homes there. It added that of the 320,000 extra hotel rooms, 251,500 will be in the luxury and upscale brackets, raising the share of high-end hotels from 66 to 72 percent of the total.

The high percentage of religious tourism is telling. As the location of the annual Hajj pilgrimage and the year-round pilgrimage known as Umrah, Saudi Arabia can be sure to attract a solid base of these visitors who still account for nearly 50 percent of tourism.

Pilgrimage tour and hotel operators say the opening up of the visa system since 2019 and the end of restrictions on businesses requiring a local partner have revolutionised the sector.

“The strategy for 2030 means they need pilgrims from everywhere,” said Ahmed Saber, CEO of Indonesia-based Diar Al Manasik International.

“Before it was difficult to get the visa, difficult to get the package. But now it’s easy, you can go online.

“Businesses used to need a Saudi partner but now you can bring your company from outside and start business (registering) with the government,” he said, adding he had set up new offices in nine countries over the past year offering pilgrim tours.

Earlier this year the government began offering visas on arrival for pilgrims who are resident in the EU, US and UK or who possess a valid visa for those countries. Nationals of Australia, Canada, China, Malaysia, Norway, Russia, South Africa, South Korea, Thailand and Turkey can receive an Umrah visa on arrival.

The Saudi market is so frenzied that few hoteliers seem to worry about cannibalisation amid the plethora of projects underway.

Red Sea Global, a key tourism-focused giga-project, says it will have 79 hotels by 2030. Neom is to host at least 12 resorts. Even cutting edge mall projects like Cenomi Central’s Jawharat Riyadh, which is due to open in 2027, will contain hotels.

Mandarin Oriental, which has only one luxury hotel in Riyadh among a number across the Gulf, is taking a cautious approach in contrast to some brands.

“Whilst we want to expand in Saudi Arabia, we are probably not on that progressive trajectory like some other luxury players,” said Michael Koth, general manager of the Emirates Palace Mandarin Oriental in Abu Dhabi.

“I dont think on a global scale it’s the only country one wants to invest in, but it’s one of the countries one needs to invest in. Other luxury operators have chosen to do it differently.”


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HALAL ECONOMY

HLISB Introduces BizHalal To Support SMEs in the Global Halal Market

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In a significant move to empower Small and Medium Enterprises (SMEs) navigating the lucrative global Halal market, Hong Leong Islamic Bank (HLISB) has introduced BizHalal. This innovative, Shariah-compliant banking solution is designed to provide both financial support and Halal advisory services, aligning with Malaysia’s strategic vision to expand its Halal ecosystem.

What is BizHalal?

BizHalal is more than just a financial product; it’s a partnership between HLISB and the Halal Development Corporation (HDC), solidified through a recent Memorandum of Understanding (MOU). This collaboration underscores HLISB’s dedication to fostering growth and development within the Halal industry.

Strategic Goals and Historical Context

HLISB CEO, Dafinah Ahmed Hilmi, reflected on the bank’s ongoing commitment to the Halal sector since 2018 and expressed enthusiasm about how BizHalal will further stimulate the expansion of local Halal SMEs. The service package includes tailored financing solutions and expert advisory services, ensuring businesses are well-equipped to thrive in this dynamic market.

Market Potential and Economic Impact

The global Halal market, valued at USD 3 trillion in 2020, continues to grow, with projections placing Malaysia’s Halal industry at US$113.2 billion by 2030. Despite this potential, a gap remains between the market demand and supply, highlighting the critical need for increased investment and collaboration to tap into this burgeoning sector.

Partnership Impact

HDC Chairman, Khairul Azwan Harun, emphasized the importance of strategic partnerships like that of HLISB and HDC in closing the market gap and cultivating local Halal champions. These collaborations are pivotal in ensuring the sustainability and global competitiveness of Malaysia’s Halal SMEs.

Technological Integration

Acknowledging the role of technology, HDC has introduced the Halal Integrated Platform (HIP), which simplifies the certification process and enhances the operational efficiency of Malaysia’s Halal ecosystem. This digital approach not only streamlines operations but also broadens the accessibility of Halal certification for SMEs.

Support and Advisory Services

Under BizHalal, HLISB’s Halal Industry Specialists provide comprehensive support to customers. This includes a readiness assessment, advisory assistance, and integration into the Halal Digital Ecosystem. These services are crucial for both existing Halal-certified businesses and new entrants aspiring to obtain certification.

Inclusivity and Accessibility

BizHalal is accessible to all HLISB customers, supporting both current Halal-certified businesses and those seeking to achieve certification. Additionally, customers who avail of HLISB’s business financing facilities will automatically qualify for the BizHalal program, making it easier for SMEs to join and benefit from this initiative.

With the introduction of BizHalal, HLISB reaffirms its commitment to supporting the growth of SMEs in the global Halal market. This initiative not only aligns with Malaysia’s economic goals but also serves as a catalyst for the development of a robust, sustainable Halal ecosystem that can lead on the international stage.

This rewrite not only incorporates the key phrase “HLISB Introduces BizHalal To Support SMEs in the Global Halal Market” effectively for SEO but also enhances the article’s relevance and informative nature, making it more engaging for readers interested in Islamic finance and the Halal industry.


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