This This study explores the relationship between Islamic digital marketing principles and the sustainable

business performance of localpreneurs, specifically asnaf entrepreneurs in Perlis, Malaysia. The research

addresses the core problem of how Islamic values, integrated with modern digital marketing and traditional

marketing mix strategies (product, price, place, promotion), influence customer trust and business success in a

SPSS, focusing on descriptive statistics, reliability, correlation, and regression tests. Results show that while

several marketing mix factors demonstrated moderate correlation with performance, Islamic values had the

strongest positive impact and emerged as the only significant predictor in the regression model (p = 0.015).

This suggests that ethical principles such as honesty, fairness, and social responsibility are not only culturally

aligned but also enhance business viability. Furthermore, respondents demonstrated awareness of ethical

marketing by ensuring Shariah compliance, fair pricing, and charity integration in their business practices.

The study concludes that Islamic digital marketing offers a viable model for sustainable growth among

localpreneurs. It calls for broader research into AI adoption within Islamic contexts and platform-specific

marketing strategies on tools like WhatsApp, TikTok, and Instagram to deepen understanding and improve

practical outcomes for small-scale entrepreneurs.

2.5% since 2015, with a net increase of approximately 190,000 MSMEs over the past eight years [1]. This

expansion highlights a dynamic shift in Malaysia’s economy where localpreneurs who entrepreneurs

operating within local communities play a critical role in contributing to income generation, employment

creation, and overall socio-economic development.

Fig 1: Number of percent share of MSMEs and the number of MSMEs business from year 2015 until 2023

A particularly significant development is the integration of Islamic digital marketing strategies among

localpreneurs, which directly correlates with business performance. Islamic digital marketing emphasizes

ethical values such as honesty, trust (amanah), and social responsibility, which can enhance customer trust

responsibility in Islamic digital marketing are

This verse underscores the principle of trustworthiness (amanah) and justice, which are foundational in

Islamic ethics and deeply relevant in business practices, especially in digital marketing where transparency

and integrity are essential for building customer trust and ensuring long-term sustainability.

religious and ethical concerns. While AI tools offer personalization, automation, and analytics, their

implementation within an Islamic framework raises questions about data ethics, transparency, and fairness.

According to [3], there is a growing concern among entrepreneurs about the compatibility of AI-driven

marketing tools with Islamic principles, particularly regarding privacy, consumer manipulation, and the

exploitation of customer behavior. These concerns slow down the full adoption of AI, limiting the potential

for digital innovation in Islamic marketing contexts.

In tandem with AI concerns, the rapid growth of the localpreneur economy brings with it the need to

understand how traditional marketing strategies, such as the 4Ps (Product, Price, Place, and Promotion),

evolve when combined with Islamic principles and digital tools. Many small entrepreneurs operate in niche

markets with distinct cultural and religious demands. Therefore, the implementation of Islamic marketing

Islamic values. In doing so, Malaysia can position itself as a leader in ethical entrepreneurship and Islamic

digital commerce, aligning economic growth with the moral and spiritual aspirations of its population.

The Localpreneurs, or local entrepreneurs, play a significant role in driving grassroots economic development,

especially in rural and semi-urban settings. Their performance is often shaped by a range of internal and

external factors, including access to resources, digital marketing tools, and socio-cultural values. According to

[5], localpreneurs contribute not only to economic growth but also to social cohesion by creating employment

and fostering community engagement. Their ventures, though typically small in scale, demonstrate high

adaptability, particularly in the face of economic disruptions such as the COVID-19 pandemic.

However, performance outcomes vary depending on the entrepreneur's capability to integrate digital

marketing with effective business strategies. Research [8] highlights that localpreneurs who incorporate

structured marketing frameworks such as the 4Ps (Product, Price, Place, Promotion) into their digital

strategies tend to report higher business performance metrics. These include increased sales, improved brand

visibility, and stronger customer retention. Moreover, localpreneurs who align their branding and

communication with local cultural and religious values gain trust and loyalty within their communities [9].

Islamic values also serve as a crucial performance enhancer, especially among Muslim localpreneurs.

Incorporating principles such as honesty (ṣidq), trustworthiness (amanah), and social responsibility

practices [10]. For Muslim-majority regions such as Perlis, this alignment of ethical values with business

performance is particularly impactful, as customers are more inclined to support businesses that reflect shared

and Physical Evidence, particularly relevant in-service industries, reflects the growing need for a

comprehensive and consumer-centric approach [11]. In parallel, the rise of digitalization and technological

advancement has transformed how firms implement the 4Ps, with many adopting integrated digital strategies

Product strategy now emphasizes innovation, sustainability, and digital integration. Consumers are

increasingly drawn to products that reflect ethical practices and social responsibility. According to [13], there

is a growing demand for sustainable and environmentally friendly products, prompting businesses to redesign

their offerings and supply chains to align with these values. Furthermore, the digital economy has expanded

the scope of products, introducing digital goods, subscriptions, and services that cater to tech-savvy

Pricing remains a critical determinant of profitability and market positioning. The adoption of dynamic

pricing strategies, facilitated by AI and machine learning, allows businesses to respond in real time to market

fluctuations, consumer demand, and competitive actions [15]. Post-pandemic economic challenges have

Distribution strategies have undergone a digital transformation, driven by the growth of e-commerce and

shifting consumer preferences. Businesses are investing heavily in omnichannel distribution models that blend

online platforms with traditional retail formats to ensure seamless customer experiences [18]. Innovations in

logistics, such as same-day delivery, fulfilment centres, and AI-powered inventory management, are

becoming standard. Furthermore, the expansion of mobile commerce and social selling platforms has created

new avenues for product accessibility. According to [19], integrating digital distribution with social commerce

channels enhances reach, especially among younger demographics.

Promotional strategies have shifted towards digital ecosystems, emphasizing targeted engagement over mass

communication. Social media marketing, influencer collaborations, and video content now dominate the

practices influence consumer behavior, especially when brands demonstrate commitment to Halal

certification, fair pricing, and ethical conduct. Moreover, digital Muslim entrepreneurs are using platforms

like Instagram and TikTok to promote products aligned with Islamic ethics, blending faith with innovation in

A quantitative research design was employed using structured questionnaires distributed in-person during the

Only 2.6% fall within the RM 5,251-RM 11,819 range, and none earn above RM 11,819. This suggests

financial constraints that may impact business sustainability.

of seasoned entrepreneurs. Additionally, 29.1% have been in business for 1-3 years, while 17.9% fall into the

4-6 years category. However, 23.08% have less than one year of experience, highlighting a notable number of

new entrepreneurs entering the market.

Table 1Descriptive Analysis

The reliability of the constructs was evaluated using Cronbach’s Alpha, a measure of internal consistency.

reliability and strong internal coherence. Among the independent variables, Islamic Value demonstrated the

highest reliability (0.954), reflecting its strong consistency across measurement items. Price also exhibited

showed good reliability at 0.886, ensuring the consistency of its construct. Meanwhile, Place obtained an

marketing efforts have a positive but comparatively lesser impact. Product, however, displayed the weakest

correlation (r = 0.349), implying that product attributes are less influential in driving business performance.

Additionally, strong interrelationships were identified among the independent variables, particularly between

Price and Place (r = 0.824) as well as Price and Islamic Value (r = 0.810). This suggests that pricing strategies

are closely linked to both market reach and the incorporation of Islamic Value, highlighting the interconnected

nature of these business factors.

The regression analysis was conducted to evaluate the impact of multiple independent variables on business

performance. The ANOVA results confirmed that the overall regression model was statistically significant (F

= 6.815, Sig. = 0.000), indicating that the independent variables collectively influence business performance.

However, when assessing individual variables, their significance varied. Islamic Value emerged as the only

significant predictor (B = 0.576, p = 0.015), suggesting that a stronger emphasis on Islamic principles

contributes to improved business performance. In contrast, other variables—Product (p = 0.203), Place (p =

Table 4 Regression Analysis