Muslim-friendly tourism gaining market share in UK’s $32 billion travel industry

Photo: LONDON, UK - 21 JULY, 2015: Big Ben in Westminster with red London buses going past during the day / Mikecphoto / Shutterstock.com

Muslim tourists are a key customer segment for the United Kingdom’s travel industry, accounting for an estimated $3.3 billion of spend in 2014. Top markets are Saudi Arabia, Turkey, and the UAE. With widespread availability of mosques, local halal restaurants, modest fashion brands, and hospitality services in the UK, what are the opportunities for new players to cater to the Muslim-friendly travel segment?

ROBUST TOURISM ECONOMY

The United Kingdom’s tourism sector grew at a cumulative annual growth rate of 3 percent between 2003 and 2014, climbing from 24.7 million international visitors in 2003 to 34.4 million in 2014, according to VisitBritain, the national tourism agency responsible for marketing Britain worldwide. Tourists spent a total of 22 billion pounds ($31 billion) in 2014 and assuming a consistent 3 percent CAGR through 2015, this would imply $32 billion in spend last year.

The UK’s travel and tourism ecosystem is ranked highly on key global studies. On the Anholt-GfK Roper Nation Brands Index the UK ranks third in 2015 behind Germany and the U.S. The country is fifth on the World Economic Forum Travel and Tourism Competitiveness Index Ranking 2015, which takes into account infrastructure, tourism policy, business environment, and cultural resources.

There is a coordinated national effort to market the UK abroad. VisitBritain works with public and private organizations to encourage inbound tourism after developing a long term growth strategy in 2012 to attract 40 million international visitors a year by 2020. The GREAT Britain marketing campaign has been coordinated by government organizations, including VisitBritain and VisitEngland, to attract more visitors from overseas.

Photo: Regent's Park Mosque in London in Spring, 2013 / Jim Larrison / CC BY 2.0

POPULAR DESTINATION FOR MUSLIM TOURISTS

In 2014, 2.08 million international Muslim visitors, or 6.6 percent of total visitors, arrived in the UK, according to a recently published report by CrescentRating. Muslim visitors spent an estimated $3.3 billion in 2014 and this is projected to reach $4.1 billion by 2020 at a 3.4 percent CAGR between 2014 and 2020.

Top Muslim markets for inbound tourism included Turkey with 195,913 visitors spending 145 million pounds ($212 million), Saudi Arabia with 144,421 visitors and 365 million ($517 million) expenditure, the UAE with 259,541 visitors and 437 million pounds ($618 million) expenditure, and finally Malaysia, with 157,854 visitors and 156 million pounds ($221 million) expenditure.

ISLAMIC ECONOMY ECOSYSTEM

There is already a robust infrastructure of essential services and businesses catering to Muslim needs on account of the growing Muslim population in the UK, which is estimated to be around 5 percent of the total population, after surpassing the 3 million mark. There are about 1,500 mosques across the country, with more than 300 in London alone.

Food

There is a well-established halal food industry as well: the UK halal food market is estimated at $4.5 billion in 2014, with over 3,000 halal food service outlets, 4,000 halal-certified restaurants, and a variety of halal accommodation services, according to a recent Salaam Gateway report.

Photo: LONDON, UNITED KINGDOM - June 20, 2012; Small local ethnic food supermarket Alfarawlah in London / Ttatty / Shutterstock.com

Modest fashion

The UK modest fashion industry has strengthened, with mainstream retailers understanding the importance of catering to Muslims and collaborating with designers and manufacturers to capture market share. Notable companies entering the modest fashion industry include major retailers Harrods, House of Fraser, John Lewis, Liberty London, and Marks & Spencer.

Accommodation

A number of hotels have also re-positioned to cater to Muslims. The top three listed by Premium Europe include The Landmark London, Hotel Café Royal and DUKES Hotel, all of which provide halal food options, access to copies of the Quran, and Arabic language TV channels. Other notable hotels include Marriott’s Grosvenor House Hotel in London, which caters primarily to wealthy GCC Muslim guests and offers a comprehensive suite of Muslim-friendly services. HalalBooking also notes La Suite West and the Bermondsey Square Hotel as Muslim-friendly hotels.

Bookhalalhomes, a Muslim-friendly peer-to-peer home booking platform, was launched in 2015 to offer the option to stay with families that share common Islamic values, allowing travelers to vacation without compromising their core Islamic beliefs and values. The site lists private accommodations in London and listings are carefully vetted to ensure suitability.

Photo: LONDON, UK - 23 DECEMBER, 2015: The outside of Harrods Department Store in London at night during the Christmas Season / Mikecphoto / Shutterstock.com

Tours

Dedicated tours have also popped up. Muslim History Tours offers Muslims the opportunity to learn about Muslim heritage in the UK. The company conducts tours around London and provides Muslim tourists with the opportunity to stay in Muslim-friendly accommodation, eat at Muslim-friendly restaurants, and hear stories about Islamic history in the country. Local organizations also work with Muslim History Tours, including the London Muslim Centre, the British Museum, and the Victoria & Albert Museum.

CONSIDERATIONS AND CHALLENGES

There are a number of key considerations in addressing this opportunity:

Determine your key market segment but seek to be inclusive.

The travel segment is diverse and criteria can vary significantly for Muslims from different countries.

While GCC tourists tend to spend more on luxuries and seek more expensive accommodation, this is likely not a reflection of needs of tourists from other countries.

Understanding the requirements of Muslims and sensitivity to different services and price points will help develop products and services more effectively.

Garner critical inputs for product development through comprehensive surveys and seek feedback on services provided. Further, it is important not to alienate non-Muslims, so highlight common values that appeal to them as well, such as family-friendliness, privacy, and comfort.

Understand the suite of targeted and effective marketing options.

Marketing to Muslims directly requires a tailored marketing approach.

Leveraging Muslim-focused sites such as Muslim Ad Network and Halal Ad will help reach the correct target market in a much more cost-effective way.

However, to help build visibility with inbound Muslim tourists, you should also leverage key Muslim tourism influencers in international travel, including travel bloggers such as Muslim Travel Girl and UK-based Tharik Hussein as well as tourism agencies and booking platforms such as HalalBooking.

© SalaamGateway.com 2016