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7 trends expected to shape the next phase of halal travel sector

Malaysia recently showcased export-ready halal products and services by Malaysian SMEs for the Japanese market ahead of the 2020 Olympic Games in Tokyo at the Malaysia Halal Expo 2019. The halal sector has no doubt been a fast growing one, with companies not only looking to export their halal products but also attempting to attract Muslim travellers worldwide.

With the global Muslim traveller expenditure is projected to reach US$220 billion in 2020, here are some main trends that marketers should know about the halal travel sector to stay ahead of the curve.

1. The growing importance of AR

The integration of AR to give Muslim travellers crucial cultural insights, including halal-certified eateries will be one of the trends that shape the next phase of development in the fast growing halal travel sector.

According to the Mastercard-CrescentRating Halal Travel Frontier 2019 report, more travellers will continue to take ownership of determining the level of Muslim friendliness/halalness of products and services. AR and AI technologies will be used to ascertain the halal status of ingredients, products or restaurants. Through AR, digital information on the halal status can be layered into the users’ environment in real time.

This also allows restaurants in non-Muslim majority destinations to communicate the halal status of their foods in a more targeted manner to Muslim travelers without requiring the explicit display of halal certificates in their premises.

2. AI to further empower Muslim travellers

The proliferation of chatbots custom-designed to satisfy the cultural and religious needs of a Muslim traveller has also been listed as one of the top trends. With machine and deep learning, AI will be able to collect and understand information on consumer preferences. This will enable AI to provide more personalised recommendations based on the traveller’s past trips, selections and enquiries. The report stated that this will significantly reduce the time and resources needed to research and plan travel itineraries.

3. Rise of female voice in trip planning

Heightened awareness on social causes and the rising authority of female influencers when planning trips, are also expected to result in changes in the way that Muslims travel. More Muslim females today are gaining access to tertiary education and entering the workforce. Also, majority of social media influencers in the Muslim travel and lifestyle space are female. According to the report, these complementary drivers will allow Muslim females to have a stronger influence when planning trips on their own, with their friends or even with family. As a result, more destinations will need to offer Muslim-friendly services which take into account the sensitivities of Muslim female travellers.

4. More “Instant Noodle Trips”

Driven by the demand for more authentic, affordable and accessible experiences, more Millennials and Gen Z travelers will book “Instant Noodle Trips” – affordable, impromptu short trips. These two groups are usually prompted by promotional sales for airfares, travel discounts during off peak seasons, an increasing number of regional routes by budget airlines and busier work schedules all year round. With the increasing need for these trips, the report said that travel solutions will be redesigned and offered through more mobile friendly applications. These plans will have shorter lead times and are able to provide travelers with instant booking and confirmation of all aspects of travel services.

5. Mergers and acquisitions in the Muslim travel space

The report also foresees the consolidation of Muslim travel service providers in 2019. An increase in venture capital funding for this segment, coupled with more start-ups and risk capital flows, will result in stronger brands capable of competing in the overall travel segment. More investments will be channeled to actualise and deliver better solutions to Muslim travelers. According to Mastercard’s report, this will result in the emergence of companies which will be on track to become unicorns in the next coming years.

6. Rise of non-traditional travel destinations

Non-Organisation of Islamic Cooperation (OIC) destinations, such as South Africa, Japan and Taiwan, will dramatically change the Muslim-friendly narrative, the report stated. Competition and dynamism are expected lead to innovations and developments that will benefit both, destinations, as well as Muslim travelers. In particular, the report predicts that destination leaders in OIC regions such as Malaysia and non-OIC regions such as Singapore will face stiff competition.

7. A streamlined visa approval process

Muslims travelling to Mecca to perform Umrah can expect a streamlined visa approval process, as changes in the Umrah Visa process and the rise of new interactive technology will mean that traditional Hajj and Umrah service providers will face disruption in their business models. Young Millennial Muslim travelers will now also be able to book their own do-it-yourself Umrah. This means that existing players will need to re-invent themselves and re-imagine the services they offer to stay relevant.

“The Halal Travel Frontier 2019 Report gives businesses, governments and other stakeholders in the travel sector an overview of the trends sweeping the fast growing Halal travel industry and how they can maximize opportunities in this fast growing travel sector,” said Safdar Khan, division president, Indonesia, Malaysia and Brunei, Mastercard.

The report analyses changes in the halal travel space, and provides insights on how these trends will impact and influence the Muslim traveler. It predicts how technology, the environment and social activism will bring about major changes in all aspects of the halal travel industry and make it easier for Muslim travelers to explore the world.

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