Branding could be the key to progress in the Muslim World

Developing countries in the Muslim World need to methodically outline a procedure of branding their societies, products, governing and educational systems within the Islamic Shari‘ah “trademark.”

Developing countries in the Muslim World need to methodically outline a procedure of branding their societies, products, governing and educational systems within the Islamic Shari‘ah “trademark.”

Foreign direct investment, stable presence of capital, and repeat purchases are economic factors that are interconnected through the brand factor. Branding or the brand concept is the main factor that generates repeat purchases and stable flow of needed investment into a business organization or a state entity. This column will try to shed light on the importance of manufacturing a societal brand in order to foster entrepreneurial environment and economic development.

About 15 years ago, speaking to a Croatian classmate about attending her friend’s wedding in the Islamic Republic of Iran, the author heard the following phrase, “My father is not ok with me going to Iran, as it’s unsafe, instead I will be going to New York City this summer.” In 2002, there were 909 murders, 3,885 rapes, and 36,555 robberies in New York. A quick internet search will reveal that the crime rate for Iran’s largest cities does not even come close to that of New York. Yet, people would be willing to spend money on a trip to New York far more willingly than on a trip to Isfahan or Tabriz. Of course, there are other factors at play as to why people would want to go to New York over Iran, but definitely, the so-called “safety” factor probably discourages many from going to one of the safest countries in Asia. For political reasons, Iran has been branded badly. This is the case with many other developing countries, especially in the Muslim World.

The bad branding issue did not leave even China unscathed. Through books like Poorly Made in China: An Insider’s Account of the Tactics Behind China’s Production Game and the barrage of plastic-rice-type reports on China, many people try to avoid purchasing Chinese products whenever possible. Yet, when the news reports in October 2017 revealed that Japan’s Kobe Steel faked data for metal used in planes and cars, most people including the author, still view Japan and Japanese products as the benchmark of high quality. Why? Because Japan successfully branded itself as a good quality place.

As the famous saying goes, Harley Davidson does not sell motorcycles, Starbucks does not sell coffee and Coca-Cola does not sell a soft drink. All of these successful companies sell a particular image, identity, and an experience first and everything else second. The same concept should be used by countries seeking to attract foreign investment or those aiming to create a stable socio-economic environment for the development of domestic entrepreneurship.

The brand factor seems to be the blind spot of many economic policy makers in the developing countries, especially in the Muslim World. Branding is one of the main reasons that both Coca-Cola and Pepsi are still successful. Both of them sell almost an identical product, yet both are in business because of their ability to create a strong base of loyal customers who have positive emotional associations with these drinks despite their questionable health impacts.

Prominent companies can lose their machinery, distribution, plants, but, as long as they don’t lose their brand, they can quickly rebuild.

Today, even the corporate media and academia of capitalist regimes acknowledge that the established capitalist economic model is disconnected from the real world of economics. The fundamental “givens” of capitalist economics are being questioned even by its proponents and public advocates. It seems though many developing countries are still unaware of this reality. The discourse on economics in the developing world is still framed within the conventional capitalist paradigm.

It is Scandinavian and European countries that are showing practical interest in unconventional economic tools like universal basic income and usury-free banking system. Both concepts are widely present in ancient classical Islamic scholarship but seem to have been generally ignored by Muslims.

The conventional capitalist economic narrative that enjoys a monopoly in the academic field today is still deeply ingrained within colonized Muslim educational institutions. Thus, the economic development discussion within the Muslim World is still stuck within outdated concepts and scenarios.

Developing countries in the Muslim World need to methodically outline a procedure of branding their societies, products, governing and educational systems within the Islamic Shari‘ah “trademark.” Proper Islamic branding has proven profitable in various sectors, from tourism to finance. An Islamic branding factor is often “successfully” abused by questionable regimes and organizations trying to capitalize on the halal trademark, for instance. The crisis of trust in cutthroat capitalism created a window of opportunity to utilize Islam’s branding potential for human welfare and economic justice.

The question Muslim economists must be pre-occupied with is, how can the trademarks like halal, Islamic banking, a Shari‘ah court system, etc. be utilized to attract Muslim and non-Muslim human capital with its vast skills, knowledge and investment potential, thus fostering productive economic development. Of course due to the massive anti-Islam PR campaign worldwide this will not be easy, but great things were never meant to be easy.

The main sector in which Muslim countries have opted for cultivating a brand concept on a grand scale is the most obvious one: tourism. It is time to grasp that branding one’s legal system, infrastructure, academia, etc, is as important as branding cars, foods, and other goods a country produces.

Learning from the German experience would be a good start. One of the reasons Germany managed to maintain its productivity high in the manufacturing sector during the age where companies move abroad for cheap labour is because it managed to create a social and legal system that puts human welfare first. By not being cutthroat capitalist in its approach, it fostered a productive economic environment that created the “Made in Germany” brand.

The Islamic economic paradigm possesses methodological and strategic requirements to replicate and even outperform the “Made in Germany” success story. It is simply a matter of will, political and social.

by Maksud Djavadov

This article was first published here in the Crescent International December 2017 edition