When we think of migration, we often think ethnic minority. But what if that isn’t always the case? In some of the world’s largest cities, people with different ethnic backgrounds, some once known as a minority, now, are often the majority.
Take Germany, for example, in nearly all the renown cities, more than half of 6-year olds already are categorised into different ethnic groups. This is a statement taken from Schneider, a migration researcher at the University of Osnabruck.
Europe is already one of the major continents which has several majority-minority cities, i.e., cities where the majority of the population belongs to a minority group. This, according to Schneider, signifies a ‘demographic revolution that has a bigger and deeper impact than anything we have experienced since the Second World War. This in turn also greatly influences the consumer market.
In 2014, statistics show that at least one in six of the population had an immigrant background. To display the sheer impact of migration, The UN (United Nations) calculated how the population would evolve without the presence of people entering and leaving a country. According to the United Nations, the European population would evidently shrink. At present, the migration status is efficient enough to compensate for the rate of deaths overtaking the birth rate. However, without migration, the effects of the population in Europe would have significantly diminished already.
At least 80% of the population growth within the 28 European countries between 2000 and 2014 was a direct result of migration. Only a mere 20% of the population increase was due to natural growth. Of course, there are significant factors that differentiate each European country. To name a few, the refugee crisis between 2015 and 2016 in Germany and the UK experienced a strong migration peak, while many of Europe’s Eastern countries, experienced a downfall in population between 2000 and 2015. We can be sure that the general trend in such research is an aging native population and a limited or stable growth thanks to immigration.
According to research, European residents with a migration background tend to be of the younger and more urban generation. Amongst migration of the second generation, those aged between 15 and 24, are proportionally over-represented. In 2014, the average age on record for non-European migrant children was 8 years lower than the non-migrant population. On top of this, 60% of all migrants from outside of the EU (according to statistics taken from Eurostat in 2017) live in cities. Less than 20% live in rural areas, accounting for at least 13% less than the native population. Subsequently, the difference in these populations and consumer traits between large cities and more rural communities are increasing at a rapid rate.
Halal consumption – the billion-dollar market
Amongst the non-indigenous population, the Muslim community represents the largest ethnic group. In 2016, the Muslim population amounted to 4.9% of the European population, an estimated 25.8 million people across 30 countries, in comparison with 19.5 million people in 2010. This trend will no doubt continue in the future, even if migration should cease.
Even if the European boarders were to close, the Muslim population would continue to grow at a steady rate to 7.4% by 2050. This is due to the Muslim population is significantly younger compared to other ethnic communities and therefore the fertility rate is consequently higher than non-Muslims. At present, 27% of Muslims in Europe are younger than 15 which is almost double in comparison with non-Muslims. At present, out of three European countries, France represents the highest percentage of Muslims, which currently stands at 12.7%. However, judging by statistics and following the current increase in trends, the largest Muslim population in 2050 will exist in Sweden which will account for 20.5% of the total population. Within this percentage will exist an avaricious middle class with considerable spending habits. Lamrabat said in 2016, ‘the migrant class is not a separate social class, but more, a large part of the existing middle class.’
The purchasing and consumption power of this increasingly growing Muslim community is largely fuelled by religion and culture. The annual religious ceremony, Ramadan, can seriously boost turnover and sales, as shops scurry to replenish their stock with specified products desired by their customers. This month of fasting ends with a ceremonial feast and the giving and receiving of gifts between large Muslim families. In Islamic countries, even clothing sales can soar by 30% during this time.
In Europe, we are often bombarded by the reminder of Christmas at every opportunity from as early as October. It seems like Halloween comes and goes and Bam! The big guy in his red suit is back! So why is it that Ramadan barely makes an appearance on the retail scene? It’s simple, if multi-cultural citizens cannot find what they are looking for in their regular supermarket, they will simply look elsewhere. As a result, the supermarket chain ‘Tanger Markt, which stocks a wide variety of ethnic products, directly import products from Morocco, Turkey, Surinam, and Asia, and has been an instant hit in Amsterdam and Belgium where they are host countries to large ethnic communities. The company also has branches in most larger Dutch and Belgian cities and have plans to expand to Germany.
Halal not only has huge economic potential in Western brands but also in markets too. The total Muslim consumption of food and drink in 2015 calculated at 1.452 billion euros or 17% of worldwide expenditure, according to Thomson Reuters in 2017. By 2021, this figure is expected to rise to 1.625 billion euros. The halal consumption alone amounted to 355 billion dollars in 2015. This potential also can vouch for sales in clothing. More and more mainstream chains such as Dolce & Gobana, Mango, and H&M all cater for fashion-conscious Muslim women. These stores mentioned provide their own headscarves and full -length robes. On top of that, these items of clothing do not necessarily need to be designed specifically with Muslim women in mind, modest, everyday items such as long dresses, long-sleeved tops and shawls can cater for shoppers with a range of ethnic backgrounds.
The first global customers
In is inevitable that migration flow will continue in the coming decades, especially between poor and rich countries. This will have a major knock-on effect on the world’s economic system. As a matter of fact, the World Bank and the International Monetary fund (2016) predict that we are on the verge of a new world order, in which migration will play a pivotal role. Even though migration staggered around 1% for many years since 2000 there has been a clear acceleration, one that seems likely here to stay.
We believe that consumers of ‘foreign’ origin are the first true global consumers. When some say that ‘the world has a become a village,’ this does not ring truer for the migration population. Muslims in Europe, for example, are an international community with close internal networks, which means that they regularly encounter products and brands from different countries. Consumption of goods is also a hot topic within the Muslim community since many are often searching for the best food and clothing products that sufficiently coincide with their religious beliefs.
Muslims aside, other consumers of a migration background are also likely to keep in close contact with their land of origin. Packages and parcels containing ‘local products from home’ are often found travelling back and forth to those living abroad. Similarly, Marks & Spencer and Albert Heijn set up special shops for their Chinese customers so that expats did not have to miss out on their favourite home comforts while working in the Far East. There are of course some commercial opportunities for organising something in the opposite direction, too. This multi-cultural population also has many hard-worker two-earner families, who sometimes do not have the time or willpower to search through ethnic shops and markets to find specific products.
Additionally, there is also the phenomenon of parallel import. Popular products in non-indigenous communities that cannot be found in one European country but can be found in another, inevitably find themselves into ethnic supermarkets and corner shops. This represents a significant loss of turnover for the traditional mainstream supermarkets and retailers. Lamrabat recommends that brands should consider thinking more internationally, with their new mobile consumer at the forefront of their decisions. The reality is that our shopping streets are becoming more and more diverse and it is essential that retailers act smart and get on board.