The Proposed Used of e-Commerce Platform in e-Marketing Strategy for Asnaf Entrepreneur’s Products and Services within
the Scope of Jayadiri Scheme at Lembaga Zakat Negeri Kedah
Nurul Shahariza Abu Hassan1, Siti Hafsha Albasri1, Farah Nadirah Abdul Manan1, Mohd Nasri Ab Ghani2
1 Universiti Islam Antarabangsa Sultan Abdul Halim Mu’adzam Shah (UniSHAMS), Malaysia
2 Lembaga Zakat Negeri Kedah (LZNK), Malaysia
*Corresponding Author: [email protected]
Accepted: 15 February 2021 | Published: 1 March 2021
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Abstract: The Covid’19 epidemic has accelerated the e-marketing trend for all products and services. E-commerce platform applications are now growing rapidly around the world. Asnaf entrepreneurs with the support of zakat institutions should take the opportunity to implement transformation in their marketing strategies. This conceptual study will suggest the application of e-commerce platform in the e-marketing strategy for asnaf entrepreneurs' business within the scope and role of the Jayadiri scheme. This study will focus on the application of e- commerce platform in giving a positive impact in helping asnaf entrepreneurs increase the sales revenue of their products and services. The results of the study are expected to further expand the role of the existing Jayadiri Scheme that implemented by Lembaga Zakat Negeri Kedah (LZNK) to be the catalysts for the success of asnaf entrepreneurs in the future.
Keywords: Zakat, Jayadiri Scheme, e-marketing, e-commerce, Asnaf entrepreneur
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1. Introduction
Zakat institutions have played an important role to ensure that every category of Asnaf receive zakat distribution effectively. Several zakat centers have made the transformation in their distribution aid in ensuring that recipients of zakat can improve their life to further become zakat payers. The supports and assistances in the field of entrepreneurship are seen to be the reliable mode that can improve the standard of living of this group. For instance, Lembaga Zakat Negeri Kedah (LZNK) is one of the active organizations established Asnaf entrepreneur development program, namely Jayadiri Scheme.
However, most of Asnaf entrepreneurs faced the barrier exposure related to marketing aspects, especially through e-marketing. Marketing strategies are very important for delivering product information, getting the right customers and the key elements of a business's success (Lussier, Airports, & Marom, 2016). A business will fail when there are weaknesses in the marketing aspect (Arasti, Zandi, & Talebi, 2012). Therefore, marketing is one of the important elements in the construction of Asnaf entrepreneur development model (Balwi & Halim, 2008).
The implementation of the Movement Control Order (MCO) to control the COVID-19 epidemic has changed the consumer trends to online business. Therefore, the business owners have to explore new strategies to interact with customers and facilitate the transaction process.
The year 2020 is changing the way of the lifestyle, work and spending of the society through
online. As a result, all brands and retailers around the world have stepped up their digitalization efforts and strengthened their online businesses.
As regard, this not only led to the strong adoption of e-commerce among local small and medium enterprises (SMEs), but also created new market segments for the industry. According to Berita Harian (May 2020), the new shopping habits among Malaysian consumers with the new importance of e-commerce role in daily life caused the consumers to spend about 20 percents more time in Shopee in a week. This shows that an increase in the dependence of Malaysian consumers on e-commerce as one-stop solution center to everything, including entertainment, grocery purchases and so on.
Therefore, it is important for Asnaf entrepreneurs to take the opportunity to practice the channel of e-marketing to promote their products and services. Asnaf entrepreneurs should always focus on improving business performance for the purpose of business continuity which in return can help the sustainability of the business venture. Good business performance can lead the Asnaf entrepreneurs to earn a good living as well as becoming zakat payers in the future.
This study will propose the application of an e-commerce platform as one-stop solution center for the products and services of Asnaf entrepreneurs by further expanding the scope and role of the Jayadiri scheme in the field of e-marketing.
2. Jayadiri Scheme
The Jayadiri scheme was introduced by LZNK in 2008 to focus on poor Asnaf category. It provided assistance to Asnaf entrepreneurs through financial capital or tools and equipment for applicants who have experience and potential to carry out economic activities. Maximum assistance for each application is RM5000 for equipment value and RM3000 for assistance in cash. The scheme has improved the living standards of those in need as they will continue to receive their income continuously if using it productively. In 2019, LZNK has distributed RM2, 034,602 in the Jayadiri scheme to help Asnaf entrepreneurs to increase their sales.
Asnaf entrepreneurs who receive the assistance from this scheme usually run small businesses but have potential to be more developed in future (Nurul, Roslida, Siti Hafsha & Rahayati, 2018). The establishment of this scheme is intended to help develop the economy for asnaf entrepreneurs. About 80% of the total zakat recipients improved their living conditions from Jayadiri Scheme. According to the statistics released by the Department of Statistics of Malaysia (Jabatan Perangkaan Malaysia), the poverty rate in the state of Kedah decreased to 0.3% in 2014 from 1.7% in 2012. The rural poverty index also decreased by 0.2% from 2.6%.
Asnaf entrepreneurs need supports and assistances from any agencies and organizations to either start a business or expand their business. According to Hamawwa (2018), this assistance and support is divided into two forms, namely financial and non-financial resources. Financial resources related to financial assistance by micro financial institutions will help SMEs entrepreneurs to improve their business operations. Among the non-financial resources are training assistance and the provision of support equipment provided either formally or informally to help the poor. This assistance can help entrepreneurs increase production and increase sales revenue.
3. The Online Business
Nowadays, online purchases have risen sharply despite of the public outrage over the spread of the Covid-19 pandemic. This may be driven by public compliance with the direction of the Movement Control Order (MCO) enforced by the government since March 18, 2020. The government's determination to create the best 5G facilities by 2021 as well as the existence of various plans offering cheap and fast internet has boosted public confidence and entrepreneurs to conduct their business affairs online. In addition, the situation has sparked the community's creativity to try new ways of doing business and some are already planning to promote market and distribute their products and services online.
According to Amiru and Zulhelmi (2013), changes that occur especially in the field of technology have caused the business environment to change. This is because technology is closely related to the field of industry and business. Information technology is one that undergoes change and has a big impact on the operating system of an organization and the way it works. Advances in information technology have created virtual workers in which the employee do not have to come to the office and only need to work from home. According to Microsoft Founder Bill Gates, the entrepreneurs without the online business mean that the business is over. His words clearly showed that online business is a priority in today's sophisticated internet era (Sinar Harian, 2020).
The application of internet and electronic media as the main support to market products and services, sharing new product ideas and information and the application has attracted the attention of researchers, practitioners and policy makers (Gohary, 2012). MYNIC Berhad for instance, has conducted a Digital Market Mastery Training Program (PLPPD) which was seen to have a significant impact towards Small & Medium Enterprises (SMEs). The training provided the modules of website building and techniques to increase the number of visits to the web or SEO adaptation. It successfully helped SMEs to improve the income and be able to compete in a more competitive digital economy market. The outcomes has showed that there is an increase of more than 100% of the income of participants and most of them become successful as the online entrepreneurs to expand their products to international markets (MYNIC, 2019).
4. E- Marketing
E-Marketing is defined as the relationship between customers and organizations communicate through the website and perform the process of purchasing goods and services offered by a business. According to Ahmad Syahrul (2012), e-marketing is a mainstream for a business to sell goods and services to consumers widely using new methods through electronic media.
Ibrahim Ali (2015) also defined e-marketing as a process of buying and selling the advertising, demands, delivery, payment and even after-sales service for services and goods made through electronic media. The e-marketing medium is used as a model to follow by most of the developing countries, especially in implementing and practicing the system as well as boosting the growth of information and communication technology (ICT) in the future (Park, 2010).
Malaysia is one of the countries that have been identified to have high potential and better prospects to implement e-marketing in Southeast Asia (Syed, 2009). A survey by the Malaysian Communications and Multimedia Commission (MCMC) found that social media channels such as facebook, instagram, youtube, google, twitter, Linekdln and others have the most users at
Malaysia. On the other hand, the communication channel such as whatsapp has the most users followed by facebook messenger, wechat, telegram and others. The past study found that over 28.7 million Malaysians (87.4%) were internet users. (Malaysian Communications and Multimedia Commission, 2018).
5. E- Commerce as a medium of e-marketing
E-commerce is a system that allows the sale and purchase transaction between the sellers and consumers on the internet. Investwords.com defined e-commerce as a website system that has the ability to enable the process of finding and selecting products in an online catalog. This process is then completed with the payment method either via credit card or debit card, money transfer directly to the bank or Pay Pal.
The process and communication in e-commerce took place between the two parties (seller and buyer) on the production, distribution or any matter based on electronics medium (Kent W.
Colton & Kenneth L. Kraemer, 1980). Transactions conducted through this method actually open up many opportunities for traders, especially SMEs to run a business and provide the convenient way for the customers to get the product faster and more effectively.
Although Malaysia is seen entering the e-commerce market quite late in 2000, the e-commerce business in Malaysia has now grown and generated revenue of RM24.6 billion in 2017 (The Star, 2018). In line with the development of e-commerce globally, Malaysia has been recognized as a country with high potential and prospects for the implementation of e- commerce in Southeast Asia in the future. The dynamic economic strength and the complete digital technology infrastructure have introduced Malaysia as a very strategic hub for the e- commerce market in Southeast Asia.
The existence of many virtual stores selling various products and services in e-commerce platforms such as Lazada, Shopee, Alibaba, Zalora, e-Bay, Amazon.com, and GoShop is becoming more and more popular. As a result, they increased in amazing sales through this strategy. In 2019, Alibaba.com recorded sales of RM158.37 billion in conjunction with sales of 11.11 promotion while Lazada and Shopee recorded sales of 1 million units of goods in the first hour (Sinar Harian, 2020).
The Malaysian Government has also emphasized on the use of e-commerce among SMEs through the Ninth Malaysia Plan (9MP). This agenda stressed the important of the information and communication technology and encouraged the use of e-commerce in business as it is able to increase productivity and competitiveness. The government had implemented various plans and initiatives such as improve the security and consumer privacy to create trust and confidence in e-commerce, as well as providing infrastructure support including networks, payment systems and logistics to enhance e-commerce development among SME entrepreneurs.
Therefore, this opportunity should be fully utilized by SMEs to venture into the e-commerce market.
In line with this opportunity, the Malaysian Digital Economy Corporation (MDEC) has organized the first and largest e-commerce expo (eDX) on 4th to 8th of May 2020 in an effort to accelerate digitization into the new norms. The session was led by MDEC e-Commerce partners such as Shopee, Lazada, Carousell, Alibaba, BliBli and eBay. This involvement was to provide motivation and support to all SMEs entrepreneurs. The expo was held as a preparation for bringing the business offline to deal online.
6. Conclusion
E-commerce platform recently is becoming a trend in today's business world. This not only led to the strong adoption of e-commerce among local small and medium enterprises (SMEs), but also created new market segments for the industry. Business applications likes Lazada and Shopee were introduced as new alternatives to make it easier for consumers to make purchases on various necessities and wants.
Along with the expanding and rapidly evolving information technology, the marketing channel for products and services of asnaf entrepreneurs also needs to be in line with the current situation to prevent them from falling behind in competition with existing entrepreneurs.
Besides, it also can lead to the easy access of asnaf products in the community besides saving times and energy.
Furthermore, the other supporting institutions also must play a role in providing training and support to Asnaf entrepreneurs to face with the current digital era. SMECorp in collaboration with the Federal Territory Islamic Religious Council (MAIWP) has taken the initiative to assist the asnaf entrepreneurs through the Baitumal Entrepreneur Growth Program (Asnafpreneur).
This program had given the exposure to asnaf entrepreneur related to business, entrepreneurship and digital economic marketing (SMECorp, 2019).
Jayadiri Scheme as an entrepreneur development program had already succeeded in helping asnaf entrepreneurs in terms of capital injection and equipment to increase sales revenue.
However, this scope and role of the scheme should be further expanded such as training, skills and marketing support to further develop their business. Therefore, the strategic planning of marketing through e-commerce platform can be designed by zakat institutions to ensure asnaf entrepreneurs can apply this digital medium in marketing their products. This e-commerce platform shall be a marketing goal that facilitates the community to buy and find all the products and services of asnaf entrepreneurs in one platform (marketplace) known as a ‘one- stop solution center’.
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