The Islamic holy month of Ramadan begins this Tuesday, May 15, and nearly a quarter of the global population is preparing to observe the period of fasting and prayer. But Muslims aren’t the only ones readying themselves for Ramadan. Retailers are embracing the holiday as well, as it’s become a lucrative sales opportunity in recent years.
Southeast Asia, which is home to several Muslim-majority countries, is a particularly attractive region for retailers, especially markets such as Indonesia and Malaysia. The former is home to the largest Muslim population in the world, with 87.2% of people identifying as such. Islam is the official religion of Malaysia and Brunei, and the Philippines, which is predominantly Roman Catholic, also has a significant Muslim population. One estimate suggests that 10.7 million people, or 11% of the Filipino population, practices Islam.
From a business perspective, those numbers translate to significant sales opportunities, especially when it comes to mobile commerce. Mobile sales increase 26% in Southeast Asia alone prior to Ramadan.
“Our experience in Malaysia and Indonesia has helped us pinpoint these as the countries with the greatest potential for ecommerce retailers,” says Inbal Lavi, CEO of Webpals.inc. Webpals Group is a performance marketing company based in San Francisco that helps retailers strategize for targeting customers worldwide. Speaking specifically of Indonesia, she says, “It has a very young, mobile-savvy population, with 55% of its population below the age of 30.”
The company begins rolling out Ramadan-specific campaigns with its clients three to four weeks before the holiday to capture the attention of mobile-centric consumers in Southeast Asia and other regions. The appetite for mobile goods and services ramps up around the globe pre-holiday, including in the Middle East and North Africa (MENA). One study found that mobile spending in MENA rose by 44% two weeks before Ramadan, and continued increasing to a peak of 57% at Eid Al Fitr, which marks the end of the holiday.
Webpals reported a 200%+ increase in traffic and a conversion rate of more than 25% across all of its clients during Ramadan in 2017. Lavi predicts that those numbers will reach 220% and 30%, respectively, this year. She says Webpals has tracked an increased interest in premium products such as clothes, perfumes and shoes and adds that 1+1, or buy-one-get-one-free deals, and 50% off sales tend to be high-converting initiatives.
Travel is also a strong category during this period. Criteo reported that mobile travel bookings jump 52% in Turkey at Eid Al Fitr. However, the area with the greatest growth potential is food delivery services, according to Lavi. “The sector that has historically seen the largest spike is food delivery apps, whose peak hours are in the evening hours,” she says.
Although purchase activity will likely remain high throughout the month, opportunities will peak toward the end of the holiday. “From our experience, the third week of Ramadan produces the highest ROI, as it is the closest to Eid al-Fitr,” Lavi says. “We’ve also observed that the hours around midnight, when celebrants are breaking their Ramadan fasts, are the most effective times to target audiences.”