MARKETING MIX AND PERFORMANCE OF MICRO FINANCE INSTITUTIONS IN NAKURU TOWN, KENYA
Abstract
Numerous scholars have noted that Kenyan microfinance institutions continue to suffer a variety of performance-related issues, such as their capacity to draw in and keep clients. The rivalry for clients has intensified due to the emergence of sophisticated fintech businesses that target the market historically served by MFIs and offer financial services like loans via mobile devices. As a result, MFIs are becoming more and more dependent on implementing marketing mix strategies to improve their performance and acquire a competitive edge. Thus, this study's objective was to ascertain how the marketing mix affects the performance of microfinance organizations in Nakuru Town, Kenya. The research's specific objectives were to investigate how pricing decisions, place decisions, promotion decisions, and product design decisions affect performance. The product life cycle theory, balanced scorecard model, and marketing mix theory served as guiding principles for the research. Explanatory and descriptive research designs were used in this investigation. The study's target population included one branch manager, one operations manager, and five operations employees from each microfinance institution, totaling 78 respondents. The validity of the research instrument (questionnaire) was assessed through expert evaluation by the expert judges. A structured questionnaire was employed to gather data. The reliability was tested using Cronbach's alpha coefficient. Data was analyzed using SPSS software. The regression analysis revealed that pricing decisions (β=0.589, p=0.002), place strategies (β=0.621, p<0.001), promotion strategies (β=0.673, p<0.001), and product design (β=0.520, p<0.001) all had statistically significant positive effects on MFI performance. The study concluded that pricing decisions, place strategies, promotion strategies, and product design decisions all significantly affect the performance of MFIs in Nakuru Town, Kenya. The study recommends that MFIs conduct regular market research, implement flexible pricing structures, expand outreach through partnerships and digital solutions, develop integrated marketing communication strategies, invest in product innovation, and provide staff training to optimize their marketing mix and enhance overall performance.
Key words: Pricing Decisions, Place Decisions, Promotion Decisions, Product Design Decisions
CITATION: Kamundia, J., & Muchemi, A. (2024). Marketing mix and performance of micro finance institutions in Nakuru town, Kenya. The Strategic Journal of Business & Change Management, 11 (4), 1021 – 1144. http://dx.doi.org/10.61426/sjbcm.v11i4.3146
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DOI: http://dx.doi.org/10.61426/sjbcm.v11i4.3146
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