The purpose of this paper is to investigate the influence of religion on the effectiveness of product packages in attracting customers’ attention, and forming their attitudes…
Abstract
Purpose
The purpose of this paper is to investigate the influence of religion on the effectiveness of product packages in attracting customers’ attention, and forming their attitudes, preferences, and buying decisions. In other words, the study aims at finding out how do Muslims respond to product packages including elements believed to disagree with the Islamic values, in this study referred to as “contentious packages.”
Design/methodology/approach
To test the five hypotheses, the study recruited 300 young Muslims in Bahrain, chosen from the population of 14,000 students of the University of Bahrain aged between 20 and 25, 26 percent male and 74 percent female. The primary data were collected through personal interviews with the selected sample, using a specially designed questionnaire. The questionnaire included ten questions covering two personal questions for age and gender and eight other questions attempting to find out Muslims’ responses to contentious packages in terms of attention, attitudes, buying intention, company image, and word-of-mouth.
Findings
Findings indicate that use of contentious packaging runs a high risk of tarnishing a company’s reputation and appeal. Muslims who live by Shari’a and the dictates of the Kuran will consider such companies to be promoters of fornication, and will therefore boycott such companies in order to prevent them from corrupting the purity and piety of the community. If advertising firms continue to fail in recognizing the profundity of these beliefs within Muslim communities, both their fiscal success and reputation run the risk of suffering substantial damage.
Practical implications
The findings of this study send six important messages to multinational companies doing business in Islamic countries. First, Islam governs all aspects of Muslim life, including consumer behavior. Second, to prosper in Islamic countries, choose packaging that does not contradict or offend the principles and values of Islam. Third, recognize that much packaging that has proven to be effective in Western countries will not be successful in Islamic countries due to vastly different cultural environments. Fourth, a contentious package may result in a steep drop in the sales. Fifth, using contentious packages may damage the reputation. Sixth, you can attract more Muslims by using non-contentious packages.
Originality/value
This paper is of great value to companies who wish to expand their practice in Muslim countries. Its findings promise to improve advertising standards and to increase both company profits and customer satisfaction.
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Mohammed Hersi Warsame and Edward Mugambi Ireri
The purpose of this paper is to examine the direct and indirect moderation effects of demographic and socio-economic(s) factors on the adoption of Islamic banking in UAE.
Abstract
Purpose
The purpose of this paper is to examine the direct and indirect moderation effects of demographic and socio-economic(s) factors on the adoption of Islamic banking in UAE.
Design/methodology/approach
Convenience sampling was done on the residents of Sharjah, Dubai, and Abu Dhabi. A closed-ended questionnaire with 30 items was designed and pre-tested before the start of the study. Path analysis and moderation testing were the main analytical approach. A total of 320 respondents completed the survey.
Findings
The research revealed that demographic and socio-economic(s) moderators may have direct and indirect moderation effects on the adoption of the Islamic banking in the UAE, which indicates the importance of these factors in the provision of Islamic banking products and services in the UAE.
Practical implications
This study further revealed that these moderators have huge practical implications for Islamic bank managers and marketers as they can exploit these demographics to enhance their market share in the UAE.
Social implications
In UAE, minimal attention has been directed toward the role moderators would play in the criterion that individual investors would use in the adoption of Islamic banking products and services in a cosmopolitan environment that is experiencing competition from conventional banks.
Originality/value
An extensive review of the existing literature on the adoption of Islamic banking reveals that no empirical research has been undertaken to explore the role played by demographic and socio-economic(s) moderators in the adoption of Islamic banking in UAE and internationally. This study attempts to fill this gap.
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Muneer Ahmad, Muhammad Bilal Zafar and Abida Perveen
This study aims to investigate the comparative importance of factors influencing the customer shift behavior from conventional to Islamic banking for consumer finance in Pakistan.
Abstract
Purpose
This study aims to investigate the comparative importance of factors influencing the customer shift behavior from conventional to Islamic banking for consumer finance in Pakistan.
Design/methodology/approach
First, a comprehensive analysis of the existing literature was conducted to identify a broad range of factors related to customer shift behavior. Through an expert sampling, 14 essential factors were chosen for further investigation. Second, a questionnaire was developed using the analytical hierarchy process (AHP). This questionnaire was then distributed among customers who had previously been using conventional banking services but had made a shift toward Islamic banking. The purpose of this questionnaire was to gather data and insights regarding their motivations and decision-making process behind the shift, and a sample 215 customers are taken in the study.
Findings
The results of AHP depicts that the religiosity is a most important factor influencing customers to shift from conventional to Islamic banking, and the second most important factor is pricing. The other subsequent important factors are reputation of the bank, marketing and promotion, service quality, behavior of banks staff, Shariah compliance, management, convenience, fastness and charges/fees. Whereas documentation, ambiance and recommendation are found least important factors to patronize Islamic banking.
Practical implications
The study recommends Islamic banks to create awareness, concentrating on religious factor to have a greater impact on growth of Islamic banking and shrinking of conventional banking. Further, it suggests Islamic banks to apply Shariah-recommended approach of doing business, to help community in best possible way and to launch differentiated marketing techniques to attract customers. It also proposes regulatory authorities to provide facilitation to Islamic banking business by providing level playing field similar to conventional banking, tax equality and conversion of public financing from conventional banking to Islamic banking.
Originality/value
The originality of this study lies in its comprehensive analysis of factors influencing consumer shift behavior from conventional to Islamic banking in the context of consumer finance in Pakistan. By using the AHP, the study provides a structured approach to understanding the relative importance of these factors. This is the uniqueness of the paper that it applies the AHP for the analysis. Furthermore, the study offers practical implications for Islamic banks and regulatory authorities to effectively address and capitalize on this consumer shift trend.
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Jasim Al‐Ajmi, Hameeda Abo Hussain and Nadhem Al‐Saleh
The purpose of this paper is to report a study into: the motives that dispose customers in Bahrain to choose a specific bank; the level of familiarity of customers with the most…
Abstract
Purpose
The purpose of this paper is to report a study into: the motives that dispose customers in Bahrain to choose a specific bank; the level of familiarity of customers with the most widely used services/products offered by Islamic banks; and the extent of use of those products.
Design/methodology/approach
This is the first study conducted in Bahrain to include three types of bank clients: those who bank with conventional banks, those who bank with Islamic banks, and who use both kinds of banks. The results are based on a response rate of 65.5 percent from 1,000 questionnaires distributed. Descriptive statistics and non‐parametric statistics (Mann‐Whitney and Kruskal‐Wallis tests) are reported, and factor analysis used to analyze the responses.
Findings
It is found that: Islamic religious belief and social responsibility are the two most important factors that determine bank selection. Cost benefit is the third most important factor considered in bank selection; clients of conventional and Islamic banks share a number of motives, but they differ significantly on a few motives in relation to bank selection; and clients of Islamic banks are more familiar with the products/services that conform to the sharia'a. Overall, for clients who bank exclusively with Islamic banks, and for those who bank in different kinds of banks, the most widely used product/service of Islamic banks is murabaha.
Practical implications
The most important practical implication is for banks, conventional and Islamic, when setting and implementing their marketing strategies, which should include an awareness campaign. The results also benefit banks operating in the countries of the Gulf Cooperation Council (GCC). This is because of the similarities of the countries in the GCC.
Originality/value
This paper is the first attempt to identify the motives and criteria for bank selection in Bahrain among clients of conventional banks, Islamic banks, and clients who bank with both types of banks. The study goes on to determine the extent of familiarity of clients of banks in Bahrain with the products/services that comply with Islamic sharia'a.
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To plan an appropriate marketing strategy for attracting new customers, commercial banks need to identify the criteria on which potential customers determine their bank selection…
Abstract
To plan an appropriate marketing strategy for attracting new customers, commercial banks need to identify the criteria on which potential customers determine their bank selection decision. The study focuses on examining the bank selection criteria being employed by college students in Bahrain. A total of 1,000 students aged 19‐24 (45 per cent male and 55 per cent female) of the University of Bahrain served as a sample for the study. Our examination relied on 30 selection factors extracted from relevant literature, personal experience and interviews with some bank officials and college students. Findings reveal that the chief factors determining college students’ bank selection are: bank’s reputation, availability of parking space near the bank, friendliness of bank personnel, and availability and location of automated teller machines (ATM). Findings suggest that it may be necessary to deal with male and female students as distinctive segments with different priorities in their bank selection process.
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This paper aims to provide an account of how Islam regulates the processes and interactions in areas of the economy and trade. It seeks to provide insights on business ethics and…
Abstract
Purpose
This paper aims to provide an account of how Islam regulates the processes and interactions in areas of the economy and trade. It seeks to provide insights on business ethics and social responsibility from the perspective of the Islamic religion.
Design/methodology/approach
A survey of literature on the two issues business ethics and social responsibility is carried out. The various arguments advanced here rest on the teachings of the holy book of Islam (The Quran) and the teachings of the Prophet of Islam (Mohammed).
Findings
For Muslims, ethics in business may only be obtained if one has complete faith in God. From the perspective of the Quranic revelations, it is apparent that Islam has given the solution for ethical problems and the religion of Islam teaches about good morals and ethics in a business life.
Research limitations/implications
The paper can be enhanced and extended further to examine the reality of business ethic conduct and social responsibility in Muslim countries.
Practical implications
The existence of irregularity in the spheres of honesty and transparency (i.e. information), and the existence of uncontrolled greed have led to the deterioration of morals in business dealings. The world has an opportunity to share information and learn.
Originality/value
The paper provides good information on the two issues of business ethics and social responsibility particularly from the view point of Islam. This is very important since the provided insights will add to the body of knowledge in those areas in business. The originality of the paper is based on the careful interpretation of some Quranic verses and the teachings of the Prophet Mohammed. It can be a good source of information for persons who have business dealings in Muslim countries.
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Islamic banking institutions have been in operation for nearly 50 years now and despite having been in competition with much more entrenched conventional rivals have demonstrated…
Abstract
Islamic banking institutions have been in operation for nearly 50 years now and despite having been in competition with much more entrenched conventional rivals have demonstrated remarkable potential for growth and sustainability in different countries in both Muslim-dominated and Muslim-minority jurisdictions. The sustained upsurge in Islamic banks’ operations level to even a double-digit mark is not accidental but a replica of the levels of engagement of customers with Islamic banking institutions among other factors. There are various studies on Islamic banking, which covered wide range of issues, including those on Islamic banks customers’ patronage factors.
Accordingly, this chapter presents discussions on factors that influence customers’ engagement/patronage with Islamic banking. From plethora of studies conducted over long period of time and in different countries, many different factors have been identified as the determinants of customers’ engagements. The factors include but are not limited to customers’ personal attributes such as their understanding, knowledge, and perceptions of banking products, the banking institutions’ related factors such as product pricing, technology adopted by bank, environmental factors, and other myriads of determinants.
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Sulaiman Lujja, Mustafa Omar Mohammed and Rusni Hassan
Islamic banking (IB) has been globally embraced by over 76 countries, with over $2tn in assets. Despite this remarkable progress, there are countries that are yet to fully embrace…
Abstract
Purpose
Islamic banking (IB) has been globally embraced by over 76 countries, with over $2tn in assets. Despite this remarkable progress, there are countries that are yet to fully embrace IB (Uganda inclusive). All the ongoing initiatives in Uganda (at policy level) to establish IB require supporting study of public awareness and attitudes toward IB. This will stimulate a down-top approach to the feasibility of IB and policymaking, thus providing a fertile ground for wider consideration of the majority stakeholders’ views in formulating standards and policy guidelines regulating IB. This study aims to explore the perception of Ugandans towards IB.
Design/methodology/approach
The study is exploratory in nature and uses a quantitative method. Out of the 400 questionnaires distributed, only 354 were usable for further analysis. SPSS 21 was used to analyze data using descriptive statistics and factor analysis.
Findings
Major findings indicate that unlike non-Muslims, Muslims are more knowledgeable about the IB culture, although both groups have low awareness about IB terminologies. There were inconsistences in Muslim and non-Muslim attitudes toward IB, for instance; while non-Muslims are motivated by “profitability”, Muslims’ inclination to IB is mainly due to “religious and profitability combined”. Both groups demonstrated some uniformity in their selection criteria of banks such as “third party influence”, although they are inconsistent in other factors.
Originality/value
The novelty of this study rests in its down-top approach to feasibility of IB by gauging the perception of majority stakeholders before IB is established. The study is conducted in a heterogeneous society unlike many of similar studies that have focused on Muslim majority countries. As most studies (with similar background) are at least 18 years old, this study remains outstanding in gauging the dynamics of stakeholders in Muslim minority countries which have yet established IB.
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Saad A. Metawa and Mohammed Almossawi
Describes a study designed to investigate the banking behavior of Islamic bank customers in the state of Bahrain. The study sample comprised 300 customers. A comprehensive profile…
Abstract
Describes a study designed to investigate the banking behavior of Islamic bank customers in the state of Bahrain. The study sample comprised 300 customers. A comprehensive profile analysis and a series of chi‐square tests were conducted to reveal key characteristics and patterns: the majority of Islamic bank customers are well educated; approximately 80 per cent are between 25‐50 years of age; more than 50 per cent of the surveyed customers have maintained their current banking relationship with Islamic banks for more than six years; customers’ awareness and usage rates are quite high for savings accounts, current accounts, investment accounts and automated teller machines; customers were found to be most satisfied with the products/services they use most, with the investment accounts receiving the highest satisfaction score; Islamic bank employees received the highest satisfaction score among the elements of the service delivery system; the two most important bank selection criteria were adherence to the Islamic principles, followed by the rate of return.
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Maizaitulaidawati Md Husin and Asmak Ab Rahman
The purpose of this paper is to apply theory of planned behaviour (TPB) in predicting consumer intention to participate in takaful. One area of concern for takaful operators is…
Abstract
Purpose
The purpose of this paper is to apply theory of planned behaviour (TPB) in predicting consumer intention to participate in takaful. One area of concern for takaful operators is the untapped Islamic insurance (takaful) market and lower market share compared to conventional insurance counterparts. It is possible that the application of the TPB could shed some light on the problem and possibly offer some assistance to the takaful operators.
Design/methodology/approach
Interrelationships among attitudes, subjective norm, perceived behavioural control and purchase intentions in regard to takaful products participation were examined within a framework of the theory of planned behaviour. A model and series of propositions are developed. The propositions are open to empirical verification and can form the basis for a research stream on takaful participation.
Findings
In identifying factors influencing takaful participation, TPB is used and the model incorporates certain individual factors that are likely to influence intentions towards takaful participation. The model proposes that individual factors such as awareness, knowledge and exposure have impacts on takaful participation.
Originality/value
This study provides insights for a previously unaddressed takaful participation among potential consumers. Prior work on determining participation of takaful has not applied TPB in an effort to understand the phenomenon.