NICHE STRATEGY AND FIRM PERFORMANCE OF BAMBURI SPECIAL 
PRODUCTS LIMITED IN KENYA 
CATHERINE WAYUA NDIOO 
D53/PT/CTY/38559/2016 
A RESEARCH PROJECT SUBMITTED TO THE SCHOOL OF BUSINESS IN 
PARTIAL FULFILMENT FOR THE AWARD OF A MASTERS DEGREE IN 
BUSINESS ADMINISTRATION (STRATEGIC MANAGEMENT) OF 
KENYATTA UNIVERSITY 
NOVEMBER, 2020 

11th Dec 2020


iii 
Table of Contents 
Declaration ...................................................................................................................... ii 
Table of contents ............................................................................................................ iii 
List of tables ................................................................................................................... vi 
List of figures ................................................................................................................ vii 
Abbreviations and acronyms ...................................................................................... viii 
Operational definition of terms .................................................................................... ix 
Abstract ........................................................................................................................ xiii 
CHAPTER ONE: INTRODUCTION .......................................................................... 1 
1.1 Background of the Study ........................................................................................ 1 
1.2 Statement of the Problem ........................................................................................ 9 
1.3 Objectives of the Study ......................................................................................... 11 
1.4 Research Questions ............................................................................................... 11 
1.5 Significance of the Study ...................................................................................... 11 
1.6 Scope of the Study ................................................................................................ 12 
1.7 Limitations and Delimitations of the Study .......................................................... 12 
1.8 Organization of the Study ..................................................................................... 13 
CHAPTER TWO: LITERATURER REVIEW ........................................................ 14 
2.1 Organization of the Study ..................................................................................... 14 
2.2 Theoretical Literature Review .............................................................................. 14 
2.3 Empirical Studies .................................................................................................. 19 
2.4 Summary of Literature Review and Research Gaps ............................................. 25 
2.5 Conceptual Framework ......................................................................................... 31 
CHAPTER THREE: RESEARCH METHODOLOGY ........................................... 32 
3.1 Introduction ........................................................................................................... 32 

iv 
3.2 Research Design ................................................................................................... 32 
3.3 Target Population .................................................................................................. 32 
3.4 Sampling Technique and Sample Size ................................................................. 33 
3.5 Data Sources and Collection Instruments ............................................................. 33 
3.6 Pilot Study ............................................................................................................ 34 
3.7 Data Collection Procedures .................................................................................. 36 
3.8 Data Analysis and Presentation ............................................................................ 36 
3.9 Ethical Considerations .......................................................................................... 37 
CHAPTER FOUR: RESEARCH FINDINGS AND DISCUSSIONS ...................... 39 
4.1 Introduction ........................................................................................................... 39 
4.2 Response Rate ....................................................................................................... 39 
4.3 Demographic Information..................................................................................... 40 
4.4 Descriptive Statistics ............................................................................................ 42 
4.5 Correlation Analysis ............................................................................................. 55 
4.6 Test for Regression Analysis’ Assumptions ......................................................... 56 
4.7 Regression analysis ............................................................................................... 59 
CHAPTER FIVE: SUMMARY, CONCLUSIONS AND 
RECOMMENDATIONS ............................................................................................. 65 
5.1 Introduction ........................................................................................................... 65 
5.2 Summary of the Findings ...................................................................................... 65 
5.3 Conclusion ............................................................................................................ 67 
5.4 Recommendations ................................................................................................. 68 
5.5 Suggestions for Further Studies ............................................................................ 70 
REFERENCES ............................................................................................................. 71 
APPENDICES .............................................................................................................. 75 

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Appendix I: Letter of Introduction.............................................................................. 75 
Appendix II: Questionnaire ........................................................................................ 76 
Appendix IV: Work Plan ............................................................................................ 85 

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List of Tables 
Table 3.1: Target Population .......................................................................................... 33 
Table 3.3: Reliability Analysis ....................................................................................... 36 
Table 4.1: Response Rate ............................................................................................... 39 
Table 4.2: Niche Strategies Practiced by the Organization ............................................ 43 
Table 4.3: Descriptive Statistics on Engaging Niche Strategies .................................... 44 
Table 4.4: Descriptive Statistics for Segmentation strategy ........................................... 46 
Table 4.5: Descriptive Statistics for Positioning strategy ............................................. 48 
Table 4.6: Descriptive Statistics for Differentiation strategy ......................................... 50 
Table 4.7: Firm Performance Due to Niche Strategy ..................................................... 53 
Table 4.8: Correlation Analysis ...................................................................................... 55 
Table 4.9: Shapiro-Wilk Test ......................................................................................... 57 
Table 4.10: Durbin–Watson statistic .............................................................................. 58 
Table 4.11: Collinearity Statistics .................................................................................. 59 
Table 4.12: Breusch-Pagan / Cook-Weisberg test for heteroscedasticity ...................... 59 
Table 4.13: Model Summary .......................................................................................... 60 
Table 4.14: ANOVA ...................................................................................................... 61 
Table 4.15: Coefficients ................................................................................................. 61 

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List of Figures 
Figure 2.1: Conceptual Framework ................................................................................ 31 
Figure 4.1: Respondents Level in the Organization ....................................................... 40 
Figure 4.2: Respondents Length of Service in the Organization .................................... 41 
Figure 4.3: Respondents Highest Level of Education .................................................... 42 

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Abbreviations and Acronyms 
BSP Bamburi Special Products Ltd 
CMA Concrete Manufacturers Association 
CMA Capital Markets Authority 
GDP Gross Domestic Product 
ISO International Organization of Standardization 
KNBS Kenya National Bureau of Statistics 
LTD Limited 
MTIHUD Ministry of Transport Infrastructure Housing and Urban 
Development 
RBV Resource-Based View 

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Operational Definition of Terms 
Strategy A forward-looking statement explaining the plan of action for 
an organization to achieve its Vision and Mission. There are 
three levels of strategy: Corporate Strategy, Business Strategy 
and Functional Strategy. 
Corporate Strategy This is a future-focused statement that outlines the strategic 
direction of the organization as a whole. It describes the 
business strategy of the organization, and is often 
accompanied by Vision statement. In this study niche strategy 
is studied as a corporate strategy where a firm finds a niche in 
its industry and devotes its entire firm resources to serving it. 
Business Strategy This is a progressive statement that sets the strategic goals of a 
business unit (where an organization has different units), and 
is aligned to deliver the corporate goals outlined in the firm’s 
corporate strategy. 
Functional strategy This is a forward-looking statement that sets the strategic 
goals of a specific business Function eg Marketing, Finance, 
Production etc, and is meant to deliver the business or 
corporate goals outlined in the business or corporate strategy 
respectively, and to continue to strengthen and enhance the 
Functional area itself. 
Firm Performance This can be said to be a criteria to establish a firm or 
organization’s wellbeing, based on the level which it achieves 
its set business objectives and remains efficient and effective 

x 
in its operations. This study applies financial and nonfinancial 
measures of firm performance. 
Niche This is a focused or specialized area of a broader market that 
has specific and distinct characteristics, and which a firm can 
define and dedicate its resources to serving in order to 
differentiate itself from competition and achieve its goals. 
Niche Strategy This is a business strategy that focuses on parts of the market 
with little or no competition. This study investigates niche 
strategy as a corporate strategy (entire organization’s business 
strategy, as opposed to a specific Function like Marketing); 
where a firm finds a niche in its industry that is underserved 
and with unmet needs, and devotes its entire firm resources to 
serving that niche, in order to differentiate itself from the 
competition and to achieve its vision and goals. 
Segmentation strategy This is a component of niche strategy where a firm instead of 
focusing its business in serving a general target market 
population, instead splits it into smaller sets of markets with 
shared needs, then concentrates its entire business into 
serving one or a few of those segments. This approach is 
taken at corporate level strategy as opposed to being a 
function (marketing) level strategy. This study considers 
geographic, demographic and psychographic elements of 
segmentation strategy. 
Positioning strategy This is an element of niche strategy where a firm takes a 
business approach of modelling its company image and its 

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offering to occupy a distinctive, meaningful and competitive 
position in the mind of a specific niche, as compared to 
competition. This way it is applied as a corporate level 
strategy as opposed to function (marketing) level. This study 
considers positioning by benefits, application and leadership 
positioning. 
Differentiation strategy This is a component of niche strategy where a firm, as its 
corporate level business strategy, chooses to apply relevant, 
meaningful and valuable attributes to its business that 
distinguishes it from others in order to attract a specific 
niche. It is therefore applied at corporate level strategy as 
opposed to function (marketing) level strategy. This study 
considers differentiation by features, quality and unique 
value proposition. 
Objective A brief statement that describes specific, critical, actionable 
and measurable things a firm must do in order to effectively 
execute its strategy and realize its vision and mission. 
Vision This is a summary statement which is an expression of a 
firm’s long-term direction; or long term dream of what it 
constantly strives to achieve. 
Mission This is a concise statement that uses inspiring and memorable 
words to describe the current top-level strategic goals of the 
organization. 
Competitive Advantage This is the possession by a firm of competencies that enable it 
to perform better than its competitors in various 

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performance measures like profitability, customer loyalty etc, 
and to generally stand out in its industry. 
Company image Also referred to as corporate image or reputation refers to the 
manner in which a company, its business activities, and its 
products and services are perceived by outsiders including its 
customers, stakeholders and the general public. 
Bamburi Special Products Limited 
This is a Kenya based concrete manufacturing company, a 
subsidiary of Bamburi Cement Limited; which provides 
concrete to contractors for their construction projects. 
Ready-mix concrete A mixture of cement, sand and aggregates, prepared at the 
factory and delivered to construction sites for immediate use. 
Precast concrete This is a form of concrete which is prepared, cast, and cured 
in a controlled factory environment; and is typically used for 
construction structural components like wall panels, beams, 
columns, tunnels etc. 
Concrete paving blocks These are small wedges made of concrete, of different sizes 
and shapes, laid on the ground for construction road carriage 
way surfaces, car parks, landscaped compounds etc. 
Concrete mix design This is a process of construction preparation in which a mix of 
different elements create the required strength and durability 
of a concrete structure. 
Pre-construction survey This is an activity that involves developing a draft layout of a 
construction site, including location of the proposed structure 
and adjacent structure, exiting roads, parking lots etc. 

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Abstract 
Niche strategy has in recent years become a common, profitable business approach 
applied by business firms world-over, for its benefits like avoiding direct competition 
with larger competitors, where a firm identifies profitable niches with unmet needs, or 
even for survival. While the construction industry in Kenya has been performing well in 
the last 10 years, one industry niche, commercial concrete manufacturing, has not. Niche 
strategy is often viewed as a function level strategy, however this study aimed to ascertain 
its effects, where applied as a corporate level strategy, on firm performance of Bamburi 
Special Products Limited, a commercial concrete manufacturing niche company in 
Kenya. The specific objectives of the study were to establish the effects of segmentation 
strategy, differentiation strategy and positioning strategy on firm performance. The study 
benefits policy makers focused on developing policies for the concrete manufacturing 
sector in Kenya, scholars and management practitioners. The study employed descriptive 
research design based on case study approach. Population of the study was management 
team at Bamburi Special Products Limited, and the sample size was 53 management and 
supervisory employees of the company. The study made use of primary data. A semistructured 
questionnaire was applied to collect primary data, with a pilot test done to 
augment the research instrument’s validity, also increasing the research reliability. 
Collected data was analyzed using descriptive methods including standard deviation and 
means, and presented using graphs and tables. A simple regression analysis was done to 
show the relationship between the dependent and independent variables. The study found 
segmentation strategy, differentiation strategy and positioning strategy to all have a 
positive and significant influence on firm performance. The study further established that 
differentiation strategy had the greatest influence on firm performance, followed by 
segmentation strategy and lastly positioning strategy. The study recommends for the 
company’s correct application of the niche strategy to maximize on the positive benefits 
of the strategy, and Kenya government support with developing policies to tackle existing 
challenges in the construction industry. Recommendation is also made for further study 
of niche strategy as a corporate level strategy, and addressing other concrete 
manufacturing companies in Kenya to facilitate comparison and generalization of the 
research findings. 

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CHAPTER ONE: INTRODUCTION 
1.1 Background of the Study 
Business firms are formed to achieve a defined vision and mission, and then all efforts 
are made to realize them (Wadha, 2016). Whenever developing its business strategy 
therefore a firm must define where it wants to be in the future and how to get there, taking 
into account the viable alternatives, options and its available resources (Peppard & Ward, 
2016). According to Porter (2013) a superior business strategy helps a firm achieve 
superior profitability in its industry by realizing higher prices or lower costs than its 
competitors. 
Generally, business strategy development, according to authors such as Král and Králová 
(2016) should start with analyzing the environment surrounding the company, and 
developing a plan of action that gives the organization competitive advantage. The 
SWOT analysis is the most commonly applied mechanism for a firm to analyze its 
situation, by determining its strengths and opportunities as well as threats and weaknesses 
that the market, in the scope of its business, offers (Nikulin & Becker, 2015). According 
to Hill et al. (2014) a deep understanding of the competitive environment, and objective 
evaluation of available resources, are some of the key prerequisites for a successful 
strategy formulation process. 
Parrish (2010) asserts that a firm that chooses the niche strategy as its corporate business 
strategy chooses to concentrate its business on a focused consumer segment or market 
that in underserved or whose needs are not met. According to Hooley et al. (2014), 
Parrish et al. (2016) it starts by first identifying the pockets, segment or markets and then 
developing a business strategy for it, which entails focusing efforts exclusively on 
serving those targets. Strategic management scholars have identified niche strategy as an 

2 
important corporate business strategy. The strategy has many benefits as shown by 
various researchers, including profits, high growth, competitiveness and high market 
share. For example, drawing extensively from industrial organization economics, Porter 
(2016) analyzed competitive positioning of firms and argued that niche firms can justify 
charging higher prices. According to Parrish et al. (2016), a niche-firm gains economic 
profit because it works in a relatively uncontested market. Being in a niche means the 
firm is not under pressure to reduce prices, because the more distinctive the firm’s 
products or processes, the less competition the firm faces (Akbar et al., 2017). 
The construction industry in Kenya has different niches some of which include cement 
manufacturing, paint business, building stones business, real estate, concrete 
manufacturing among others (Construction Kenya, 2020). Hernandez (2018) posits that 
construction companies that specialize on a specific unique niche as their business 
strategy tend to achieve higher success compared to those that attempt to be everything 
to every customer. A study by FMI Corporation (2019) discovered that construction 
companies which focused on specific segments won business nearly twice compared 
those which did not. Additionally Toften and Hammervoll (2019) states being perceived 
as experts in a particular area helps in generating business for niche firms. 
According to Richard et al. (2019) an organization's performance can be determined by 
measuring how well it achieves its set goals and objectives. The topic of firm 
performance has been a focus of strategy research for decades. Niche strategy, like any 
other strategy has to be applied correctly to achieve positive results. Analysing strategic 
management capabilities allows scholars to assess how firms create and deploy 
intangible assets that drive and support business performance (Agyapong et al., 2016; 
Bowman & Ambrosini, 2016; Lopez, 2015). Bamburi Special Products Limited a 

3 
subsidiary company of Bamburi Cement Limited, which operates independently from the 
mother company, has adopted niche strategy as its corporate level or company-wide 
strategy, with a focus on concrete manufacturing. The company’s performance, as 
measured by both financial and nonfinancial indicators, has however been dropping over 
the last 10 years, bringing to question its strategic management approach. This study 
therefore sought to determine the effects of niche strategy, as a corporate level strategy, 
on firm performance of Bamburi Special Products Limited in Kenya. 
1.1.1 Firm Performance 
The concept of firm performance has been looked at differently over the years. Managers 
made realization that a firm would be considered successful when it accomplished its 
goals (effectiveness) using minimum resources (efficiency). Profit is realized to be a key 
measure of performance. A firm's performance in recent years has been defined as how 
well it reaches its vision, mission and goals. It is the achieved results as compared to the 
intended (Dignum & Dignum, 2019). In his research Zubair (2017) presents the 
conventional business thinking, that the main goal of a company is to make profit, and 
the fundamental task of management is to find solutions in order to increase continually 
this profit. It may be concluded a firm’s performance to be, the overall opinion held about 
the firm, using the performance indicators that showcase its activities and achievements 
in relation to its goals (Katone, 2015). Different firm stakeholders have different demands 
on the firm which need to be managed independently, and these demands also represent 
the various features of firm performance (Selvam et al., 2016). 
According to Katone (2015) firm performance can be measured using both financial and 
nonfinancial indicators. Financial reports are the major sources of information regarding 
a firm performance, and are commonly used to evaluate the financial position and 

4 
business activities of the firm. Financial indicators applied in measuring firm 
performance in this study are profitability, revenue, market share (Saoud, 2020). A 
number of researchers have also studied various nonfinancial activities that positively 
influence the results of a firm’s financial activity, and management practitioners are 
increasingly transforming evaluation systems of their company performance to also trace 
non-financial evaluation indicators and therefore use the new strategies in competing 
(Chen et al., 2019; Wiersma, 2016; Coram et al., 2011). This is because in modern-day 
economy firm management cannot only rely on financial indicators to manage the firm 
successfully. This study applied metrics of measuring nonfinancial performance 
proposed by Katone (2015) including quality, innovation, customer satisfaction and 
brand awareness, which often expose the economic position of the firm and growth 
opportunities available to it. Selvam et al. (2016) proposes other dimensions like market 
value, corporate governance, customer satisfaction levels, employee satisfaction, 
environmental audit and social performance. 
1.1.2 Niche Strategy 
Niche strategy has been defined as a business strategy where an organization focuses its 
entire business in serving a well-defined specialized market previously ignored or 
underserved by other firms (Chalasani & Shani, 2016; Dalgic & Leeuw, 2017). The 
strategy helps a firm resonate more deeply with a distinct set of customers; as it dedicates 
its energies to serving them. Most importantly is serving this niche in a superior manner 
compared to any other company (Akbar et al., 2017). Since customers do not have 
identical preferences and firms are unable to satisfy these diverse needs, they choose the 
distinct set of customers they resonate more deeply with, and devote to serve them better 

5 
than any other company to gain competitive advantage (Camilleri, 2018; Akbar, et al., 
2017; Toften & Hammervoll, 2019). 
This study conceptualized niche strategy as a corporate level strategy, which is strategy 
applied by the entire organization. Research shows niche strategy has been applied 
successfully around the world, across diverse industries, in different economies, over the 
last decade. Researchers have found evidence to show that the strategy provides 
companies with competitive advantage, high profit margins, strong market position, 
business growth and success; resulting mainly from the high customer satisfaction it 
achieves (Collins, 2018; Anzaku & Salau, 2017). Brodsky (2018); Parrish et al. (2015), 
and Shani and Chalasani (2016) presented changes in customer preferences, and the fact 
that a profitable niche will always attract competition, as some of the risks to the 
sustainability of this strategy. 
Akbar et al. (2017) advanced three essential elements of niche strategy after studying 
definitions of the practice by different earlier authors: segmentation strategy, positioning 
strategy and differentiation strategy. Segmentation strategy as a niche business strategy 
involves splitting a general target market or prospective buyers into smaller sets of 
markets with shared needs and/or application of a product, then concentrating on one or 
a few of those market segments (Doyle, 2016; Bygate, 2015). Bearing closely similar 
characteristics means they are likely to respond similarly to a business action. 
Segmentation can be based on factors like specialized needs, income, geographical 
location, consumption capacity, age, socioeconomic groups, lifestyle, benefits sought, 
buyer size, reasons for purchasing among others (Hollensen & Opresnik, 2015). 

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The segment chosen in the one that is most profitable, easy to identify from the 
population, and aligns well with the firm’s strengths, to give it competitive advantage. 
Some statistical techniques in segmentation include conjoint analysis, cluster analysis, 
factor analysis, logistical regression analysis, multidimensional scaling and canonical 
analysis (Kotler, 2016). Upon selection of a target segment, the firm then must position 
its offering so it creates a clearly defined image in the target customers’ minds. In 
positioning strategy therefore the firm models its image and offering to occupy a 
distinctive, meaningful and competitive position in the mind of the target customer, as 
compared to competition (Dibb & Simkin, 2017). A niche firm positions itself into 
smaller and profitable markets previously ignored or underserved by other firms 
(Chalasani & Shani, 2016; Dalgic & Leeuw, 2017). 
A niche firm may also apply differentiation strategy, to have its offering well 
distinguished from others in order to attract a specific niche (McGee, 2018). It may be 
based on tangible features like performance, reliability, quality, price, style, durability; 
or alternatively (or in addition) intangible features such as reputation, branding and 
customer service (McGee, 2018; Trivikram, 2017). It is important that a firm considers 
attributes that are relevant, meaningful and valuable to its niche customers (Carpenter et 
al., 2015). 
1.1.3 Bamburi Special Products Limited 
Bamburi Special Products Limited (BSP) is a Kenya based subsidiary of Bamburi 
Cement Limited, the largest cement manufacturer and marketer in East Africa. It is a 
limited liability company operated independently by its own management team, reporting 
financially to the Nairobi Securities Exchange listed mother company (Bamburi, 2019). 
It began operations in 2008 as a concrete manufacturing company, targeting a niche 

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customer base of contractors who buy ready-mix concrete and concrete paving blocks 
for their large-scale construction projects. BSP has therefore adopted niche strategy as 
its corporate strategy, and developed capacity to serve this niche market, differentiating 
itself using resources and advantages offered by its mother company (Bamburi, 2019). 
BSP was the first commercial concrete supplier to set up in Kenya, but in recent years 
other cement companies and dealers in Kenya have established concrete manufacturing 
operations, while some of the larger construction contractors occasionally set up their 
own temporary batching plants to serve their concrete needs for a particular project 
rather than buying from commercial suppliers (Construction Kenya, 2019). The 
company has two divisions - ready-mix concrete, and precast concrete which include 
reinforced concrete and paving blocks production. Ready-mix concrete is a factoryprepared 
mixture of cement, sand and aggregate, delivered to a construction site for 
immediate use. In its website the company says it also has capacity to customize 
concrete mix designs to meet specific customer needs, and provide other concrete 
related consultancy services like site surveys and designs, blocks laying services, 
technical support among others (Bamburi, 2019). BSP uses the brand 'BamburiBlox' for 
its paving blocks products, and 'BamburiConcrete' for its ready mix concrete - to 
differentiate and distinguish itself from competition (O’Cass & Ngo, 2017). 
According to the company’s website, it gives a guarantee of up to 15 years for its concrete 
products. It has also positioned itself as offering convenience and high quality products, 
especially to large contractors who require large volumes of concrete pouring at site to 
fast track their projects. Its expansive capacity is supported by a research and 
development centre owned by its parent company. Some of the major projects it has 
served as listed on its website include government projects like the Standard Gauge 

8 
Railway (SGR), construction of Times Towers, Turkwel dam, Nyali bridge, Ngong and 
Turkana wind mills, major road, ports and dams projects among others. It also supplies 
to individual home builders and smaller construction projects as its secondary markets. 
Construction is one of the most critical and fastest growing industries globally. The 
industry experienced dramatic development over the past few decades; and is expected 
to grow at 85% contributing $15.5trillion to economies globally by the year 2030, with 
three countries (US, China and India) accounting for about 57% of this global growth 
(Global Construction 2030, 2015). This growth will outpace world GDP over the next 
ten years (Ellis, 2018). In Kenya the sector has grown by between 8% and 14% annually 
in the last decade, as a result of increasing investment by the government and private 
sectors (KNBS, 2018). East Africa countries allocated a third of their 2018/19 budgets to 
infrastructure projects to boost economic activity and spur growth. Of the $15.8 billion 
allocated by the Kenya government to development projects, $6.25 billion (39.5 per cent) 
went to infrastructure projects, while Tanzania, Uganda and Rwanda allocated $5.5 
billion, $3.05 billion and $1.28 billion respectively (The East African, 2018). The growth 
has however come with many challenges. Globally the industry is challenged to keep 
transforming to tackle economic downturns, shift to green and sustainable construction 
and maximize on opportunities of the digital era (Barawas et al., 2018.) 
Economic and industry growth is seen as a dynamic process directly affected by the entry, 
expansion, contraction and exit of firms. It is expected that the entry and expansion of 
firms in an industry leads to its positive growth while exit and contraction of firms result 
to negative growth (Johansson, 2010). According to Blackburn et al. (2009) firm 
performance is episodic and not a smooth progression, and can be as a result of a range 
of factors, both internal and external to the organization. BSP’s business performance 

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has not been in tandem with the general industry performance, despite the fact that 
government infrastructure projects which have been growing, constitute its major focus. 
At its inception BSP enjoyed stable performance, with profit before tax peaking at 
Ksh123 million in 2011, before beginning a steady decline. In 2010 the company’s profit 
before tax rose to Ksh77 million, and again to Ksh123 million in 2011, before dropping 
to Ksh56 million in 2012. In 2013 it dropped by 67%, before improving by 300% in 
2014, and again by 132% to stand at Ksh56 million in 2016. Despite its capabilities in 
2017 BSP made a loss of Ksh8.9 million, but in 2018 profit before tax rose to Ksh7.6 
million. In 2019 this increased to Ksh42.5 million (Bamburi, 2019). While its revenues 
have grown over the years, this is still behind the industry growth. Its revenues in 2017 
dropped by 3% compared to 2016 (Bamburi, 2017). In 2009 the company made Ksh526 
million in revenues, which grew to Ksh736 million in 2010, and again to Ksh1.2 billion 
in 2011, and to Ksh1.45 billion in 2012. In 2013 the company said its revenues grew by 
5%, then again by 37% in 2014, and by 3% in 2016 (Bamburi, 2019). Although other 
players in the market are private companies who do not have an obligation to publicly 
publish their returns, Kenya National Bureau of Statistics (2019) reports BSP as the 
largest concrete manufacturer in Kenya. 
1.2 Statement of the Problem 
Bamburi Special Products Ltd (BSP) has been suffering declining business performance 
in recent years, with profit before tax reducing from Ksh123 million in 2011 to a loss of 
Ksh8.9 million in 2018 and 42.5 million profit in 2019. The company has recorded 
stagnating volumes and selling price over the last 10 years. This is contrary to Kenya’s 
construction industry growing at between 8% and 14% annually in the last decade, and 
Kenya government spend on infrastructure projects rising to $6.25 billion (Ksh625 

10 
billion) in its 2018/19 budget, compared to Ksh140 billion in the 2009/10 and Ksh44.6 
billion in the 2004/05 budgets. 
In the last ten years more companies have increasingly been venturing into the concrete 
manufacturing niche, especially ready-mix delivery business, attracted by the growing 
need among developers putting up large-scale constructions (Construction Kenya, 2018). 
In addition to this are large contractors doing their own concrete production on site; 
further reducing the total market available for BSP. For example while the total readymix 
concrete market in Kenya in 2017 was estimated to be 1.35million M3, only about 
30% of this volume was sold by commercial ready mix manufacturers (KNBS, 2018). 
Niche strategy has often been looked at from a functional level (marketing function 
strategy), however in this current study it is studied from a corporate level strategy point 
of view, meaning a company-wide strategy that directs the entire company’s activities. 
Previous research done on niche strategy include Hernandez, 2018; Toften & 
Hammervoll, 2019; and Zhao et al., 2017 and they found that construction related 
companies whose strategy focuses on exploiting a special niche market tend to realize 
better success compared to those who try to be all things to all customers. BSP’s 
performance call to question this conclusion. In addition, research by Mokaya et al. 
(2016), Kim et al. (2018), Blankson and Crawford (2016), Chege (2018), Cheptiram et 
al. (2016) and Adimo (2018) have only explored the various individual niche elements 
of positioning strategy, segmentation strategy and differentiation strategy and their 
independent effects on firm performance, without considering what the effects are for 
combining them all as a niche strategy. These studies also focused on niche strategy as a 
marketing, function level, strategy and not as a corporate level strategy. This is the gap 
this current study sought to fill. 

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1.3 Objectives of the Study 
1.3.1 General Objective 
This study sought to determine the effects of niche strategy on firm performance of 
Bamburi Special Products Limited in Kenya. 
1.3.2 Specific Objectives 
The research was guided by the following specific objectives: 
i) To investigate the effects of segmentation strategy on firm performance of 
Bamburi Special Products Limited in Kenya 
ii) To ascertain the effects of positioning strategy on firm performance of Bamburi 
Special Products Limited in Kenya 
iii) To establish the effects of differentiation strategy on firm performance of 
Bamburi Special Products Limited in Kenya 
1.4 Research Questions 
The research was guided by the following research questions: 
i) What are the effects of segmentation strategy on the firm performance of Bamburi 
Special Products Limited in Kenya? 
ii) What are the effects of positioning strategy on the firm performance of Bamburi 
Special Products Limited in Kenya? 
iii) What are the effects of differentiation strategy on firm performance of Bamburi 
Special Products Limited in Kenya? 
1.5 Significance of the Study 
Managers of concrete manufacturing firms and also the general business sector benefits 
from this study as they get a better understanding of niche strategy and choosing 
appropriate strategies relevant to their businesses. The study is also useful to policy 

12 
makers as it provides them with information they can use in policy development focused 
on the development of the concrete manufacturing sector. It is also a good reference 
material for researchers and academia, especially on the topic of niche strategy, its effects 
on firm performance, and especially in relation to the concrete manufacturing industry. 
The findings not only expands the already existing literature in niche strategy and 
strategic management, especially in the context of developing countries like Kenya; but 
also provokes other researchers to pursue studies that contribute to expanding the 
literature on the topic especially addressing niche strategy as a corporate level strategy. 
Others like potential investors in the sector benefits from this study because it provides 
relevant information to aid their decision making. 
1.6 Scope of the Study 
This study focused on niche strategy and its effects on firm performance of Bamburi 
Special Products Limited in Kenya. The study approached the niche strategy from a 
corporate level strategy standpoint. In Bamburi Special Products Limited, niche strategy 
is done at corporate level (company-wide strategy) and not the marketing (function) 
level. The management staff of the company was targeted because they had the relevant 
information sought on niche strategy. Data was collected using semi-structured 
questionnaires and analyzed using descriptive and inferential statistics. The study was 
conducted between January 2019 and March 2020. 
1.7 Limitations and Delimitations of the Study 
The study targeted a single company, Bamburi Special Products Limited; therefore a 
challenge might have been in being able to generalize the findings to the entire industry. 
The scope of this study was therefore the first limitation. It was recommended that further 
research be focused on more companies to confirm the study findings. The company's 

13 
confidential policy also limited the respondents' responses, as they were not willing to 
diverge information they feel as sensitive to the company, for fear it may be shared with 
competitors. An assurance was made to the respondents that this was an academic study 
and on the confidential handling of the information shared, and in keeping the 
respondents anonymous. Time was also a limitation, as the three months duration 
allocated for data collection was a challenge where the respondents were not easily 
available to respond to the questionnaires. 
1.8 Organization of the Study 
This research project comprises of five chapters. Chapter one covers the study 
background, statement of the problem, study objectives, research questions, study 
significance, study scope, limitations and organization of the study. Chapter two covers 
theoretical framework, empirical review, literature review summary, the research gaps as 
well as conceptual framework. Chapter three covers the methodology that was applied in 
this research and therefore showed the research design used, target population, sampling 
technique and sample size, instruments for data collection, data collection procedures, 
validity and reliability analysis, procedures for data analysis and presentation, 
operationalization of the variables, and ethical considerations. The research findings and 
discussions are presented in the fourth chapter; the chapter presented the response rate, 
demographic data, descriptive statistics and inferential statistics. Chapter five provides a 
summary of research findings together with conclusions made from the findings and the 
recommendations made. Future research recommendations were also highlighted. 

14 
CHAPTER TWO: LITERATURER REVIEW 
2.1 Organization of the Study 
This chapter reviews the existing literature on niche strategy and firm performance. The 
chapter starts with a theoretical review that covers theories related to the variables in the 
study. This is followed by a conceptual framework showing the hypothesized 
relationships between variables. The chapter also encompasses empirical review as per 
the study objectives, critique of existing literature, research gaps and summary of the 
literature. 
2.2 Theoretical Literature Review 
The study was guided by three theories: Porter’s Generic Competitive Strategies 
typology, Resource Based View (RBV) and Configuration Theory. 
2.2.1 Resource Based View 
The Resource Based View (RBV) originated from earlier research of scholars like 
Penrose (1959), Seiznick (1975) and others. This theory places emphasis on a firm’s 
possession of strategic resources and the implication on its performance. RBV looks at 
firms as heterogeneous entities that consist of bundles of distinct resources and 
capabilities that can be harnessed to give it competitive advantage (Hart, 1995). It adopts 
an inward looking view, that a firm should determine the strategic resources and 
capabilities it has that have potential to give it sustainable competitive advantage. Further 
the theory argues that the nature of the firm’s resources, internal development of these 
resources, and the different methods of employing these resources, translate to higher 
performance (Rumelt, 1984; Wernerfelt, 1984). 

15 
For resources, whether tangible or intangible, to contribute to the firm’s competitiveness 
and superior performance however they should be inimitable, valuable, rare and nonsubstitutable 
(Dierickx & Cool, 1989; Barney, 1991). Barley (2007) recognizes these 
four resources’ characteristics as strategic assets that when mobilized properly develop 
the company’s competitive advantage and lead to improved performance. Well harnessed 
these valuable resources enable a firm take actions that generally add financial value like 
high sales, high margins and low costs. Similarly they boost the organization’s 
effectiveness and efficiency. RBV describe valuable resources to be things like assets, 
firm attributes, the firm’s processes and knowledge the firm controls. It is also possible 
to have different firms in a sector bearing heterogeneous resources. However Newbert 
(2008) opines that for a firm to achieve competitive advantage they have to combine their 
resources in a manner that achieves valuable and superior capabilities; since resources 
and capabilities are fundamentally unproductive in isolation. Bitar and Hafsi (2007) 
supports this opinion by stating that although capabilities and resources are sources of, 
they do not automatically lead to competitive advantage. 
While BRV has wide support, it also has critics. Brown et al. (1994) criticizes the theory 
for ignoring the limitations caused by the biophysical (natural) environment. Barney 
(1997) and Tokarczyk et al. (2016) also fault that the theory fails to indicate specifically 
how these resources are managed to cultivate competitive advantage and high 
performance; as if the strategic actions are self-evident. Similarly Hedman and Kalling 
(2003) fault the theory for failing to acknowledge the theory poses on management 
dynamics. Besides these the RBV has created a valuable discussion among previously 
isolated viewpoints, and has become one of the most important frameworks in strategic 
management literature (Conner, 1991; Lavie, 2006). In order to survive and grow in the 

16 
current competitive business environment firms have to offer customers value; and this 
can be developed from breaking down the broad market into smaller niches that the firm 
has the resources and capabilities to satisfy and profit from. The resource based view 
therefore has its focus on the relationship between the resources that a firm holds and its 
capabilities to develop strategies that make it stay competitive. 
Generally, competitive advantage demands of firms to develop and, or adopt strategies 
that enable it maximize on its core resources, competencies and other advantages it holds, 
in a manner that leads to achievement of its business objectives (Tokarczyk et al., 2016). 
According to Doyle (2016) a firm achieves superior performance when it understands 
requirements of customers in its niche better than its competitors targeting the general 
market; and holds resources and skills that enable it offer solutions meeting the specific 
needs of this niche. Towards this end, the RBV offers a basis to understanding why a 
firm’s possession of different capabilities and resources can lead to varying levels of 
success or lack thereof (Tokarczyk et al., 2016). 
Concrete manufacturing companies may consider gaining access to strategic resources 
like inputs (labour, capital and raw materials), knowledge (technology and operational 
know- how) and markets (distribution channels and access to customer segments) to 
target specific niches like large contractors. Firms that combine these resources 
effectively gain competitiveness and high performance (Guillen, 2015). This study 
therefore adopted the theory to explain how niche strategy can be applied on organization 
resources to attain competitive advantage and enhanced performance. 

17 
2.2.2 Porter’s Generic Competitive Strategies Typology 
The typology was proposed by Michael Porter in 1980. He held that a company can only 
realize superior performance and sustainable competitive advantage if it adopts one of 
three strategies: cost leadership, differentiation or focus. The theory therefore describes 
a firm’s competitive strategies in relation to their market scope (broad or focused), as 
well as the source of their competitive advantage (differentiation or cost). Porter (1985) 
further stated that competitive advantage is only achieved when the firm generates value 
from its customers that exceed the cost of creating it; and superior value grows out of 
either charging lower prices compared to competitors for similar benefits or offering 
unique benefits that compensate for a higher price. 
For a firm targeting the entire industry, cost leadership and industry-wide differentiation 
will be relevant, while those targeting only a part of the industry, cost or differentiation 
focus will be relevant (Witcher & Chau, 2010). A firm implementing a differentiation 
strategy chooses and adopts elements that are highly valued by its buyers and therefore 
making it unique. It chooses one or a few attributes that majority of the customers in the 
industry perceive as important; then distinctively positions itself to deliver them. It can 
then charge a premium price (Murray, 1988). 
The focus strategy targets a particular, often smaller part of the larger market. It is also 
called a niche strategy, and has two variations: differentiation focus where the firm aims 
to differentiate itself in the target segment, and cost focus where it pursues cost advantage 
in the specific segment (Tanwar, 2016). It is hoped that when the firm focuses its business 
efforts on a single or few narrow targeted segments, it will meet their needs better. It will 
endeavor to understand the customers and their unique needs more intimately and use 

18 
this knowledge to develop uniquely low-cost or well specialized products to it (Allen et 
al., 2007). The firm will tend to achieve strong customer loyalty because it serves the 
customers uniquely well, and ultimately profit from it. 
Porter’s generic strategies have been widely reviewed in literature on strategic 
management, as well as business policy, and have been hypothesized as having a positive 
effect on customer satisfaction and performance. Concrete manufacturing firms in Kenya 
can apply strategic options offered by this theory, especially the focus strategy, to create 
a defensible position, whether through cost focus or differentiated focus, by serving a 
specific segment of the market uniquely well to gain competitive advantage and high 
performance. 
2.2.3 Configuration Theory 
The configuration approach or theory came about in the 70s, with some of its earlier 
contributors being Miles and Snow (1978). The theory holds that key contributors to firm 
performance are the fit in environment and organizational design. It conceived an 
organization as a configuration with the components of strategy, people, structure and 
management processes (Walker, 1984). The theory argues that firms that achieve 
maximum output are those that best align their operations with their current environment 
(Fincam & Rhodes, 2005; Donaldson, 2001). 
The contingency theory further proposes that a firm carefully analyses its environment, 
by considering its internal characteristics and adopting its operations appropriately 
(Volberda, 2012). The theory therefore suggests interrelationships. It reasons that there 
is no one ideal formula of organizing; rather the best way is dictated by the nature of the 
firm’s environment (Donaldson, 2001). The best management style and organizational 

19 
structure too depends on a set of ‘contingency’ factors (Tosi & Slocum, 1984). Other 
researches on configuration have also uncovered evidence that having a fit among firm 
characteristics and environmental factors positively affects firm performance 
(Donaldson, 2001; Slater & Olson, 2000). Configuration theory is not beyond criticism. 
Among its vocal critics is Donaldson (2001), who argues that organizational fit can be 
positive for one set of stakeholders but negative for others. The configuration theory 
therefore does not focus on a single factor, either firm’s environment or its internal 
resources, rather on the effects of a combination of variables. 
In relation to the current study, the configuration theory sets forward a number of 
variables that play a decisive role in identifying the appropriate strategies for a concrete 
manufacturing firm to achieve high performance. Such firms should consider factors like 
the environment, firm resources, leadership style, and management system, when 
identifying appropriate strategies to help it achieve its objectives. 
2.3 Empirical Studies 
2.3.1 Segmentation Strategy and Firm Performance 
Numerous published reports attest to the value of segmentation strategy, and especially 
in achieving superior firm performance. Applications of segmentation have also been 
made across a diversity of business contexts. Onaolapo (2017) researched on 
segmentation practices and their impact on the performance of commercial banks in 
Nigeria. The study adopted descriptive research design. Data was collected using 
questionnaires and analyzed using descriptive statistics. The findings indicate that some 
players had achieved higher results compared to others, resulting to higher market share, 
revenue and profitability. It was however also found a threshold beyond which point 
banks who committed more investment into segmentation strategy began experiencing 

20 
negative results. The study was conducted among commercial banks and therefore 
inhibits generalization of research findings. The study was also conducted in Nigeria and 
the findings may not apply for the case of Kenya. 
Cheptiram et al. (2016) focused on seed companies in Kenya’s North Rift region to 
establish their experience with segmentation strategy’s contribution to firm performance. 
Data was collected using closed ended questions and analysis done using regression 
analysis. The study found a positive relationship. However while through segmentation 
strategy the seed companies could identify new profitable segments which deserved 
special attention, the study concluded that companies were not maximizing on this 
opportunity by investing adequately especially in product development and appeals 
tailored to the target segment; that would make them competitive and effectively improve 
their business performance. A seed company has a different structure from Bamburi 
Special Products Limited and therefore the findings cannot apply for our current study. 
Additional information was obtained by use of semi-structured questionnaires. 
Matipei (2018) found an improvement in the cement manufacturing industry in Kenya, 
which resulted from effective segmentation practices by the players. Segmentation 
strategy improved the competitive position of 80% of the firms studied in that research. 
This study collected secondary data from empirical review. Experience of firms operating 
in both industrial and consumer markets, as documented by research, suggest that when 
done effectively segmentation strategy increases customer appeal on the firm’s offering, 
and reduces operational costs and chances failure. This study focused on cement 
manufacturing companies and therefore the findings cannot concrete manufacturing 
companies. The actual state in the ground could not be established through secondary 
data collection and therefore this study sought to fill the gap by collecting primary data. 

21 
Gensch (2019) also presents compelling evidence of the positive effects of segmentation 
strategy in electrical equipment business. Case study research design was adopted and 
data collected using questionnaires. The study found sales to have increased by between 
12 and 18 percent where segmentation strategy was applied, and declined 10 percent it 
was not applied. This study having been conducted among electrical companies inhibits 
generalization of findings in concrete manufacturing company. 
2.3.2 Positioning Strategy and Firm Performance 
Various researches have been carried out on this concept, across various industries and 
environments, with positive results. A study by Mokaya et al. (2016) sought to determine 
the effects of positioning strategies on organizational performance in the airlines industry 
in Kenya using Kenya Airways (KQ) as a case. The study covered 215 respondents drawn 
from a population of 1230 (staff and customers). Questionnaire was used to collect data. 
Content analysis, descriptive and Pearson’s Product Moment of Correlation were used to 
analyze data. The results revealed that variations in firm performance are explained by 
pricing strategies with a confidence level of 95%. The results indicated a P-value of less 
than 0.005 against all the study variables. Pricing strategies had a significant effect on 
cost strategies, perceived service quality, differentiated benefits, innovation and firm 
performance. The study revealed a positive correlation between pricing strategies and 
perceived service quality with a correlation coefficient of 0.574; an average and positive 
correlation between pricing strategies and innovation with a correlation coefficient of 
0.464. There also existed a positive correlation between pricing strategies and 
differentiated benefits with a correlation coefficient of 0.650. Moreover, the correlation 
efficient between pricing strategies and performance was also positive, meaning that as 
a firm charges fair prices, compared to its competitors. This study focused on pricing 

22 
strategies and perceived service quality; our present study focused on positioning strategy 
based on benefits, applicability and leadership position. 
Blankson and Crawford (2016) carried out their research among retail service firms in 
Texas, and found a direct relationship between positioning strategies and firm 
performance measures like profits, market share, return on investment, sales, and 
consumer perceptions. Some of the positioning strategies were however not successful. 
The findings of the study cannot apply for Kenyan case since Texas is in a developed 
country while Kenya is still developing. The findings of a service firms cannot be applied 
for a manufacturing company. A study by Kalafatis et al. (2015) carried out in the timber 
industry also confirms the relevance of positioning strategy. Winston and Dadzie (2016) 
found that the level of senior management emphasis on market orientation in Kenyan and 
Nigerian firms was determined by the nature of the firm ownership and competition level. 
Blankson et al. (2018) in their study in the UK store and card sector found five positioning 
strategies that affected corporate performance: reliability, service, value for money, top 
of range, and the brand name. On the other hand, aspects like attractiveness, country of 
origin, and selectivity did not contribute positively to firm performance. From this study, 
firm performance measures like profits, market share, sales, return on investment, 
consumer perceptions, and company image were found to be most impacted positively 
by positioning strategies. Kim et al. (2018) study in the e-business sector also established 
positive relationship. These studies having been conducted in developed countries 
inhibits generalization of the research findings. 

23 
2.3.3 Differentiation Strategy and Firm Performance 
A study by Haarla (2016) focused on a paper printing firm in Finland and sought to find 
out whether or not its differentiation strategy provides it competitive advantage. The 
study adopted descriptive research design and collected data using structured 
questionnaires. Collected data was analyzed using correlation and regression analysis. 
The results established a positive relationship; with technology being a key differentiator, 
following the niche demands. The findings of a developed country cannot apply for a 
developing country and thus the need to fill the gap by conducting the study in Kenya. 
Shafiwu and Mohammed (2016) study in petroleum industry in Ghana sought to 
investigate the effects of differentiation strategy on profitability of firms in the industry 
This research comprised 15 oil marketing companies in Ghana, which is made up of one 
government owned and 14 privately owned. The population is homogeneous in nature, 
due to the homogeneity of the population; a cluster sampling technique is used to select 
just a company out of the population. This selected company was Total Ghana Company. 
Members were selected using a non-probability sampling technique specifically the 
purposive sampling technique. A total of 30 members were selected and administered 
with questionnaires whiles others were also interviewed. The main variables of interest 
were differentiation strategy, profitability and patronage of Effimax. The study 
discovered that the industry had not differentiated its products relative to other industries. 
This research however concluded that the differentiation strategy was still a profitable 
strategy suitable for this particular industry, and there were other factors responsible for 
the less adoption. The study was conducted in a petroleum industry and thus the findings 
cannot be applied for the case of concrete manufacturing company. 

24 
Aligah (2016) studied 33 industrial companies listed on the Amman Stock Exchange in 
Jordan and found differentiation strategy to have no significant impact on these firms’ 
performance. This they found resulted from the fact that the companies had only recently 
adopted the strategy and had not incorporated it effectively to affect and improve their 
performance positively. The findings of this study cannot be applied for the case of 
Bamburi Special Products Limited in Kenya and thus the need to fill the gap. 
A study by Nolega et al. (2015) focused on Kenya Seed Company in Kenya, with the 
results indicating a steady rise in the company’s customer base for a period of 15 years 
as a result of differentiation strategies, categorically product quality. Marangu et al. 
(2017) similarly found a positive impact on competitiveness of sugar manufacturing 
companies in Kenya, of differentiation strategies that included product design, product 
price and packaging colour. These studies were conducted in different industries and 
therefore the need to conduct a study in the concrete industry to compare the findings. 
Mwanzia (2015) in his study focused on tea exporting companies in Kenya found high 
adoption of five predetermined differentiation strategies – pricing, value-added products, 
operating procedures, distribution network and customer incentives. These however did 
not impact the firms’ market share, which indicated that application could largely be for 
other benefits apart from influencing the market share. There is need to conduct a study 
in the concrete manufacturing industry to determine whether the same differentiation 
strategies will affect firm performance. 
Results of a research by Adimo (2018) established a strong, positive and significant 
impact of differentiation strategy employed by a Kenyan manufacturing firm, Sameer 
Africa Kenya Limited on the firm’s performance. The research concluded that 

25 
differentiating through adopting product attributes superior to competition, as well as 
providing assortment of products that meet various customer needs resulted to increased 
performance. Despite the study being conducted in a manufacturing company, it was a 
case study and therefore its findings cannot be applied for other companies. Therefore, 
there is need to conduct a study in Bamburi Special Products Limited, to compare the 
findings and make generalizations. 
2.4 Summary of Literature Review and Research Gaps 
The chapter reviewed various theories on which the study is anchored on. The study was 
built on Porter’s Generic Competitive Strategies typology, Resource Based View (RBV) 
and Configuration Theory. The empirical review of literature indicated that various 
concepts regarding the topic have been investigated in different contexts. The chapter 
also presented the conceptual framework which presented diagrammatically the 
independent variables showing the specific constituents that influence a particular 
variable. Further, the chapter presented the critique of literature which helped in 
establishing the research gaps. 
A review of literature indicated that the concepts in niche strategy had been used in 
various other studies. However knowledge gaps are evident in previous studies that have 
focused on the same topic. There has been a deficit in the application of all the three 
niche strategies as most studies have focused on single aspects of niche strategy. Also, 
most of the studies approached niche strategy as a marketing function’s strategy and not 
corporate level strategy. This created a conceptual research gap which this study sought 
to explore. The studies that attempted to investigate niche strategy from a corporate level 
strategy point of view were conducted in different sectors and in developed countries and 

26 
therefore inhibiting generalization of the research findings. This created the contextual 
gap the study sought to fill. 

27 
Table 2.1 Summary of Literature Review and Research Gaps 
Author Topic Findings Research gap Focus of Current 
Study 
Toften and 
Hammervoll 
(2019) 
Niche marketing and 
strategic 
capabilities: an 
exploratory 
study of specialised 
firms 
Findings from this research suggest 
that a firm’s strategic capabilities are 
crucial to niche firms’ success; and that 
most niche firms, especially those that 
are internationally oriented, positioned 
themselves as both product specialists 
and customer specialists. 
This study focused on 
production firms within the food 
and wine industries. The study 
should thus be replicated in other 
industries and geographical 
locations. It did not also measure 
the impact on firm performance 
which was the focus of the 
current study. Niche strategy 
was approached from the 
marketing function and not 
corporate level strategy which 
was the focus of the current 
study. 
The present study 
sought to determine 
the effects of niche 
strategy on 
performance of 
Bamburi Special 
Products Limited in 
Kenya 
Petterson and 
Phillips 
(2017) 
Segmentation and 
Differentiation of 
Agri-Food Niche 
Markets: Examples 
from the 
Literature 
The study found that simple 
segmentation and differentiation 
techniques were widely applied by 
agri-food firms who are majorly 
smaller firms; and their lack of 
marketing resources may partially 
explain why these simple methods are 
used so frequently. 
The study made use of secondary 
data whose accuracy is lower 
than primary data, and which 
limited the information used to 
make the conclusion. The 
current research used both 
primary and secondary data. 
Niche markets were the focus of 
this study; current study focused 
Present study sought 
to investigate the 
effects of niche 
strategy on the firm 
performance of 
Bamburi Special 
Products Limited in 
Kenya 

28 
on niche strategy as a corporate 
level strategy. 
Akbar et al. 
(2015) 
Niche Marketing 
Strategy and Firm 
Success: Review on 
SMEs in Peninsular 
Malaysia 
The study found niche marketing 
strategy an ideal strategy for Peninsular 
Malaysia’s furniture SMEs seeking to 
increase their market shared and 
impact Malaysia’s economy generally. 
The study did not test the 
research hypothesis, rather based 
its conclusion on the successful 
application of the niche strategy 
by firms in other industries to 
gain market penetration and 
performance. 
Present study sought 
to determine the 
effects of niche 
strategy on 
performance of 
Bamburi Special 
Products Limited in 
Kenya 
Alao et al. 
(2016) 
Niche Marketing and 
Value-Based 
Differentiation in the 
Footwear Industrial 
Sub-Sector in 
Nigeria 
Niche marketing, the study found to be 
a significant strategy for a firm seeking 
to achieve value differentiation aimed 
at stimulating consumers’ purchase 
decisions especially in the retailing 
outlets of footwear sub-sector in 
Nigeria. 
The study did not clearly 
indicate if or not application of 
niche strategy resulted to 
increased firm performance. 
Therefore other researches can 
explore areas of critical 
measurements such as market 
share, competitive advantage, 
customer satisfaction and market 
performance to expand the 
study. The study having focused 
on niche strategy failed to show 
the niche strategy as a corporate 
level strategy. 
This study sought to 
determine the effects 
of niche strategy on 
performance of 
Bamburi Special 
Products Limited in 
Kenya 
Abrar et al. 
(2009) 
Innovation and 
Niche Marketing in 
Organic Textile: 
The study concluded that the level of 
profitability and survival rate of 
companies in this highly competitive 
There is need for further research 
to be conducted to exploit key 
opportunities in niche markets, 
This study sought to 
determine the effects 
of niche strategy on 

29 
Opportunities for 
Pakistan 
textile sector, depends on their 
specialization, Differentiation strategy 
and exploiting profitable, sizeable 
niche markets that have growth 
potential. The textile sector is highly 
competitive globally and an important 
one in the economies of developing 
countries like Pakistan. 
and add to the body of 
knowledge. There is need to 
study niche strategy as a 
corporate level strategy. 
performance of 
Bamburi Special 
Products Limited in 
Kenya 
Zucchella 
and Palamara 
(2016) 
Niche Strategy and 
Export Performance 
The case studies analysis in this study 
established a positive relationship 
between niche strategy and high 
international performance. Niche firms 
were found to expanding 
internationally by using horizontal 
micro-segmentation of the global 
market. They compete mainly on nonprice 
basis and search and go after 
global customers, irrespective of 
psychic/geographical distance. 
The study focused on 
internationally oriented firms, 
and so further research is 
required for firms targeting local 
customers. 
The study was 
conducted in 
Bamburi Special 
Products which is a 
local manufacturer 
Hamlin et al. 
(2015) 
Niche Marketing and 
Farm Diversification 
Processes: Insights 
from New Zealand 
and Canada 
The results indicate forming alliances 
and development of horizontal and 
vertical networks as among the most 
common strategies employed by 
successful niche marketers in these 
firms. It found the firms market niche 
products as part of a portfolio of 
products that often includes an 
The context of this study is the 
agricultural sector in developing 
countries, whose circumstances 
are quite different from 
developing countries context. 
The study was 
consucted in 
developing country, 
Kenya and the sector 
of focus was 
manufacturing i.e. 
Bamburi Special 
Products Limited 

30 
anchoring commodity. Firms however 
developed a niche positioning strategy 
often as a reaction to an existing 
situation rather than as a priority 
strategic planning process. 
Inoue and 
Nagayama 
(2017) 
Strategic Types and 
Performance of 
Niche-Firms within 
Business 
Ecosystems: A Study 
of the Japanese 
Video Game 
Industry 
This empirical study analysed and 
grouped firms into four niches 
categories: challengers, defenders, 
replicators and opportunity seekers. It 
also found that the performance 
exhibited by each niche category 
varied, with defenders having the 
highest stability and opportunity 
seekers the lowest. 
The categories proposed in this 
study are found in the Japanese 
video game industry; therefore 
further research should be 
undertaken in other industries 
The study was 
conducted in 
Bamburi Special 
Products Limited 
which is in 
manufacturing 
industry 
Source: Researcher (2019) 

31 
2.5 Conceptual Framework 
A conceptual framework refers to the broad set of principles and ideas taken from applicable 
areas of enquiry and employed in structuring an ensuing presentation (Shields & Rangarajan, 
2016). The study’s conceptual frame work is arrived at after reviewing various variables 
used in a number of studies reviewed in the literature. The particular independent variables 
for the study are segmentation strategy, positioning strategy and differentiation strategy. The 
dependent variable is firm performance. A figurative representation of the relationship 
between the independent variables and the dependent variable is indicated in Figure 2.1. 
Source: Researcher (2019) 
Figure 2.1: Conceptual Framework 
Dependent variable 
Independent variables 
Segmentation strategy 
 Geographically 
 Demographic 
 Psychographic 
Positioning strategy 
 Positioning by Benefits 
 Positioning by Application 
 Leadership Positioning 
Differentiation strategy 
 Differentiation by Features 
 Differentiation by Quality 
 Unique Value Proposition 
Firm Performance 
 Financial Performance 
 Market Performance 
 Shareholder Value 

32 
CHAPTER THREE: RESEARCH METHODOLOGY 
3.1 Introduction 
This chapter describes the methodology applied in the study. It entails: the research design, 
target population, sampling technique and sample size, data collection instruments, data 
collection techniques. 
3.2 Research Design 
This research applied descriptive research design. A descriptive study helps in answering the 
'what' question, and aims at describing a happening and its characteristics (Nassaji, 2015). 
Creswell (2018) stated that the descriptive method of research is to gather information about 
the present existing condition. The emphasis was on describing rather than on judging or 
interpreting. This design involved a set of methods and procedures that describe the intended 
variables using statistical logic. Descriptive research is appropriate as it generally allows the 
researcher to make comprehensive inferences about the investigated variables in the target 
populations (Burns et al., 2015). The descriptive approach is quick and practical in terms of 
the financial aspect. This design is considered appropriate for the type of objective of this 
study as it enabled the researcher to describe the state of affairs as they exist without 
manipulation of variables which is the aim of the study. By employing this study design, this 
study focused on obtaining quantitative data from a cross-section of project members. 
3.3 Target Population 
A population is a group targeted by a researcher and which the results of a study are 
generalized (Berg, 2017). Ngechu (2018) defines population as a well-defined set of people, 
elements, events, services, groups of things that are a focus of an investigation. The unit of 

33 
analysis was Bamburi Special Products Limited. The population of the study comprised a 
total of 53 employees that are critical in decision making affecting Bamburi Special 
Products. This included management and supervisory employees of the company; as well as 
the top and middle level management employees at Bamburi Cement Limited, the mother 
company, whose roles specifically involve making decisions that affect Bamburi Special 
Products at different levels – both operational and strategic. These are presented in Table 
3.1. 
Table 3.1: Target Population 
Position Frequency 
Top Management 13 
Middle Level Management 34 
Supervisory Staff 6 
Total 53 
Source: Bamburi Special Products Limited Human Resource Department (2019) 
3.4 Sampling Technique and Sample Size 
The study applied census method where the entire target population was studied. According 
to Lavrakas (2008) a census provides detailed information on all or most features of a 
population, and therefore totals for small geographic areas or rare population groups can be 
made. Census method was preferred in the current study due to the small size of the 
population. The entire population presented in Table 3.1 above was used in the study. 
3.5 Data Sources and Collection Instruments 
The study used primary data. Primary data was generated for the first time for the purposes 
of the current study. Questionnaires were employed for collecting primary data; and it was 

34 
drawn to correspond with the specific research objectives and conceptual framework to 
enable collection of relevant data. The questions were both structured and unstructured - 
where it is necessary to get insight into the hidden motives, background, decisions, feelings 
and interests, as well as gather adequate information. The questionnaire had three sections: 
Part A sought to establish the demographic information of the respondents and the firm. Part 
B ascertained the niche strategies the firm has adopted, while Part C established the effects 
of the niche strategy elements on the firm performance of Bamburi Special Products Limited. 
3.6 Pilot Study 
A pilot study was conducted in order to establish the validity and reliability of data collection 
instruments (Saunders et al., 2017). The questionnaires were pre-tested on a pilot set of 5 
respondents for comprehension, logic and relevance. The subjects participating in the pilot 
study were not included in the final study. All aspects of the questionnaire were pre-tested 
including question content, wording, sequence, form and layout, question difficulty and 
instructions. The feedback obtained was used to revise the questionnaire before 
administering it to the study respondents. The involvement of 5 respondents in the pilot test 
is justified on assertions by Cooper and Schindler (2016) that a size of between 5% and 10% 
of the target population is suitable to be involved in a pilot study. The findings of the pilot 
test were used to determine validity and reliability of the questionnaire. 
3.6.1 Validity of the Research Instrument 
Validity is defined as the capacity of a research measurement instrument or scale to produce 
the correct desired results; and this can apply both in the design as well as data collection 
methods (Burns & Grove, 2017). It gives an indication if a research is sound or not. It is 

35 
important that the facts obtained are consistent, the correct variables are analysed and 
approximated in equivalent units. It is challenging to ascertain for sure that a technique is 
100% valid for a research. The study sought to test the content validity of the research 
instrument. 
The determination of content validity is not numerical, but subjective and judgmental 
(Emory, 2015). Content validity of the instrument was established by grounding it in existing 
literature. Experts were asked to review the questionnaire for structure, readability, 
ambiguity, and completeness. Based on their comments, the instrument was adjusted 
accordingly before being used in the final survey. 
3.6.2 Reliability of the Research Instrument 
It is important that the instrument of measurement is dependable, so it can product results 
that are reproducible. Reliability is generally the extent to which the results of a study are 
free from errors and can be trusted. A pilot test was done and Cronbach’s Alpha applied to 
measure the reliability of the data collection instrument, by measuring the coefficient of 
internal consistency. Cronbach’s Alpha ascertains the average of measurable items and its 
correlation. Overall scale’s reliability of the present situation and the desirable situation was 
tested to ensure that it is above the accepted level of 0.70 (Hair et al., 2009). George and 
Mallery (2003) says an alpha value of above 0.7 is considered acceptable. Table 3.3 presents 
the reliability analysis findings. 

36 
Table 3.2: Reliability Analysis 
Scale Cronbach's Alpha No. of Items 
Segmentation Strategy 0.812 11 
Positioning Strategy 0.807 10 
Differentiation Strategy 0.792 9 
Firm Performance 0.833 8 
Source: Field Data (2019) 
From the findings, Segmentation strategy had an alpha value of 0.812; Positioning strategy 
had alpha value of 0.807, Differentiation strategy alpha value of 0.792, and firm performance 
0.833. All the variables had Cronbach alpha value greater than 0.7. These findings suggest 
that all the variables were reliable because they had alpha values greater than selected 
threshold value of 0.7. 
3.7 Data Collection Procedures 
The questionnaires were administered via email, telephone and drop and pick later. The 
researcher called to request them to complete the questionnaire, or have it administered via 
the telephone or face to face. This approach helped the researcher clarifying any issues as 
may be required by the respondents, allay fears of confidentiality of the information shared, 
and reduce delays in response often experienced where there is no personal contact of the 
researcher. 
3.8 Data Analysis and Presentation 
Before processing the responses, the completed questionnaires were edited for completeness 
and consistency. Data analysis involved reducing the collected data to a size that is 
convenient, creating summaries, seeking for patterns, and using statistical techniques to 

37 
produce information that the researcher used to answer the indicated research questions and 
present reliable and consistent outcomes in manner that is convincing and understandable. 
For the open-ended questions, the study employed content analysis to analyze the data 
collected, while descriptive statistics were applied to analyze closed ended questions. For 
closed ended questions, descriptive measures of central tendency (mean, mode and median) 
were employed to find out how the data incline in agreement with each other. Statistical 
Package for Social Sciences (SPSS Version 21) was used in analysis of the data. 
Measures of dispersion/variability (variance and standard deviation) were also conducted to 
establish the degree to which the data diverse from a central point. To establish the 
relationship, a regression analysis was conducted. The regression equation assumed the 
following form 
Y = βо + β1 X1 + β2 X2 + β3 X3 + έ 
Where: Y is firm performance level; βi (i = 0 – 3) is the regression coefficient; X1 to X3 is 
Segmentation strategy, Positioning strategy and Differentiation strategy; and α represents 
unexplained variables not explained by the model. 
Presentation of data was done using percentages, frequency tables, bar graphs and pie charts. 
3.9 Ethical Considerations 
Formal authorization from the National Commission for Science, Technology and 
Innovation (NACOSTI) and Kenyatta University was sought to carry out the study, before 
data collection. All the participants in the study were well informed and allowed to make 
voluntary consent. Respondents were under no obligation to participate in the study if they 
were not willing to do so. Throughout the data collection process, only formal 
communication channels were used, and confidentiality of the respondents and their names 

38 
were ensured throughout the data collection process. Information gathered was only used for 
the purposes of this academic study. The refereed materials and sources were cited 
accordingly. 

39 
CHAPTER FOUR: RESEARCH FINDINGS AND DISCUSSIONS 
4.1 Introduction 
This chapter presents data analysis, interpretation, presentation and discussion of data 
obtained from the field. The chapter specifically presents the response rate, demographic 
information of selected respondents, descriptive statistics and inferential statistics which 
included the correlation analysis and regression analysis. The study findings were presented 
as per the objectives of the study. 
4.2 Response Rate 
The study issued questionnaires to 53 management and supervisory employees of Bamburi 
Special Products Limited. Only 45 questionnaires were received back having been dully 
filled. The returned questionnaires formed 84.9% response rate. 
Table 4.1: Response Rate 
Questionnaire Frequency Percent 
Returned 45 84.9 
Un-returned 8 15.1 
Total 53 100.0 
Source: Field Data (2019) 
Mugenda and Mugenda (2013) explained that a response rate of 50% and above can be used 
for analysis; he added that 60% response rate is adequate while 70% and above is excellent. 
Therefore our response rate was excellent for analysis and reporting. 

40 
4.3 Demographic Information 
In this section the study presents the general information and bio data of respondents. The 
study specifically sought to determine respondents’ level in the organization, their length of 
service, and highest level of education. 
4.3.1 Respondents Level in the Organization 
Respondents were asked to indicate their level in the organization and the findings were as 
presented in Figure 4.1. 
Figure 4.1: Respondents Level in the Organization 
Source: Field Data (2019) 
From the findings, 64.2% of the respondents were from middle level management, 24.5% 
were in top management and 11.3% were supervisory level. These findings suggest that the 
respondents used in the study held different positions in the organization. The employees 
were in positions that allowed them to clearly understand the effects of niche strategy on 
performance of their organization. Majority (64.2%) of the respondents were of middle 
management level because they are the ones that are directly involved with the 
implementation of niche strategies in the company. 
24.5 
11.3 
64.2 
0.0 
20.0 
40.0 
60.0 
80.0 
Top Management Supervisory level Middle Management 
Percent 
Position in the Organization

41 
4.3.2 Respondents Length of Service in the Organization 
Respondents were asked to indicate the length of time they have been working in the 
organization and the findings obtained were as presented in Figure 4.2. 
Figure 4.2: Respondents Length of Service in the Organization 
Source: Field Data (2019) 
From the findings, 42.5% of the respondents indicated that they have served in the 
organization for 4 to 7 years, 27.5% for 8 to 11 years, 22.5% for 12 years and above, and 
7.5% for 0 to 3 years. These findings show that respondents used in the study had served in 
the organization for varied number of years. Most (42.5%) had served for between 4 and 7 
years. From these findings, majority of the respondents had served in the organization long 
enough and were therefore well conversant with the organization and ways in which 
performance in the company is affected by niche strategy. The findings also suggest that 
there is some level of employee retention in the company. 
4.3.3 Respondents Highest Level of Education 
Respondents were requested to indicate their highest level of education and the findings were 
as presented in Figure 4.3. 
7.5 
42.5 
27.5 
22.5 
0.0 
10.0 
20.0 
30.0 
40.0 
50.0 
0-3 years 4-7 years 8 – 11 years 12 years and 
above 
Percent 
Length of Service in the Organiation

42 
Figure 4.3: Respondents Highest Level of Education 
Source: Field Data (2019) 
From the findings, 46.7% of the respondents indicated that university undergraduate was 
their highest level of education, 33.3% had postgraduate and above while 20% had college 
level. These findings suggest that the respondents had attained various skills at different 
levels of education that probably fitted them to the various positions they held in the 
organization. The tertiary education the respondents had acquired suggests that they were 
conversant with the application of strategic management practices which includes the niche 
strategies. These findings also suggest that Bamburi Special Products Limited in Kenya 
considers level of education when hiring management and supervisory employees 
4.4 Descriptive Statistics 
Descriptive statistics were used to discuss respondents’ responses on various statements that 
related with niche strategies. The study used frequencies, percentages, means and standard 
deviations to discuss the findings. The mean (M) and standard deviation (SD) were used to 
interpret the likert scale questions where 1= Strongly Disagree, 2= Disagree, 3 = Neutral, 4= 
Agree, 5= Strongly Agree. The mean value of 0.5-1.4 were interpreted as strongly disagree, 
1.5-2.4 as disagree, 2.5-3.4 as neutral, 3.5-4.4 as agree, and 4.5-5.0 as strongly agree. 
20.0 
46.7 
33.3 
0.0 
10.0 
20.0 
30.0 
40.0 
50.0 
College Undergraduate Postgraduate and above 
Percent 
Highest Level of Education

43 
Standard deviation value greater than two were interpreted as high standard deviation which 
meant that respondent had differing opinion, if the standard deviation was less than 2 it was 
a low standard deviation an indication that respondent had similar opinion. 
4.4.1 Niche Strategies 
Respondents were asked to indicate the types of niche strategies their organization practiced 
and the findings obtained were as presented in Table 4.2. 
Table 4.2: Niche Strategies Practiced by the Organization 
Niche Strategies Frequency Percent 
Segmentation Strategy 41 91.1 
Positioning Strategy 45 100.0 
Differentiation Strategy 39 86.7 
Source: Field Data (2019) 
From the findings, 45(100%) of the respondents indicated that the organization practices 
positioning strategy, 41(91.1%) indicated it practiced segmentation strategy, and 39(86.7%) 
indicated the differentiation strategy was practiced by the organization. These findings 
suggest that Bamburi Cement Limited practices various forms of niche strategies which 
include segmentation strategy, positioning strategy and differentiation strategy. 
Respondents were also asked to indicate the reasons behind their company entering into the 
form of niche practices they mentioned. They explained that it is a business opportunity, to 
profit from niche specialised markets that they have capabilities to offer specialised products 
to and deliver good returns to their investors. In addition, they explained that it provides 
them with the opportunity to ride on the capacity of their parent companies Bamburi Cement 

44 
and LafargeHolcim, who have invested in innovative technologies that help BSP deliver 
innovative products to specialised markets like large contractors. 
These findings were in agreement with Mokaya et al., (2016) that positioning strategy has 
been found to be effective in supporting firms achieve competitive advantage and high 
performance. Also Yuksel and Yuksel (2016) established that segmentation is among 
strategic management concepts that have been widely accepted; the basis being that to 
achieve competitive advantage, and ultimately high performance, firms should identify 
profitable segments, develop appropriate strategic management mixes for each specifically, 
and serve them well. 
Respondents were asked to indicate the main objective of their company to engage in niche 
strategies using the scale where 1= Strongly Disagree, 2= Disagree, 3 = Neutral, 4= Agree, 
5= Strongly Agree. The findings were as presented in Table 4.3. 
Table 4.3: Descriptive Statistics on Engaging Niche Strategies 
Statement 
Mea 
n 
Std. 
Dev. 
To increase revenue and profit 3.968 1.269 
To achieve brand loyalty 3.907 1.406 
To generate higher margins by serving specific niches 3.896 1.193 
To enhance the company image 3.875 1.333 
To have a competitive advantage and compete effectively in the 
market 
3.868 1.339 
To provide superior customer value through meeting their needs better 3.85 1.262 
To sustain company success over the long term 3.724 1.191 
To utilize the business budget better 3.714 1.314 
Aggregate Score 3.850 1.288 
Source: Field Data (2019) 
From the findings, the respondents were in agreement that their company engages in niche 
strategies to increase revenue and profit (M=3.968, SD=1.269), to achieve brand loyalty 

45 
(M=3.907, SD=1.406), to generate higher margins by serving specific niches (M=3.896, 
SD=1.406), to enhance the company image (M=3.875; SD=1.193), to have a competitive 
advantage and compete effectively in the market (M=3.868, SD=1.339), to provide superior 
customer value through meeting their needs better (M=3.850, SD=1.262), to sustain 
company success over the long term (M=3.724, SD=1.191), and to utilize the business 
budget better (M=3.714, SD=1.314). The aggregate mean value was 3.850 which is an 
indication that on average the respondents were in general agreement on the various reasons 
why their company engages in niche strategies. 
Further, respondents were asked to indicate other objectives that lead their company to adopt 
niche strategy. Respondents indicated that the main reason for their adoption is because their 
business is really a niche business and their specialization is in offering specialized products 
and solutions. The study findings concur with Camilleri (2018) who explained that to be 
competitive companies have to narrow down to a distinct part of the market it can serve 
profitably. Akbar et al. (2015) explained that niche market strategy has been employed 
across many industries over the last decade to gain market penetration, diversification, 
achieve increased sales, and business growth and success which concurs with the findings 
of this study. 
4.4.2 Segmentation Strategy 
Respondents indicate the level concurred with statements on segmentation strategy as a 
strategy in niche strategic management. The findings were as presented in Table 4.4. 

46 
Table 4.4: Descriptive Statistics for Segmentation strategy 
Statement Mean Std. 
Dev. 
The firm has segmented its market geographically 4.610 1.784 
The firm has segmented its market demographically 4.599 1.786 
The firm has used psychographic segmentation of its market 4.588 1.788 
Engaging in Segmentation strategy has impacted our financial 
performance and shareholder returns positively 
4.569 1.671 
Engaging in Segmentation strategy has had a positive impact on the 
firm’s market share 
3.964 1.48 
Segmentation strategy has made customer acquisition easier 3.964 1.208 
Segmentation strategy has enabled us know to our customers better and 
to target them better 
3.882 1.409 
The firm has defined its market segments narrowly (as opposed to too 
broadly) to give it a better competitive advantage 
3.825 1.49 
The firm considers the quality of a market segment before making a 
strategic decision to target it 
3.241 0.938 
The firm conducts a strategic market segment portfolio research and 
analysis to establish the segments to target 
1.440 0.314 
The firm invests in adequate strategy management to reach the targeted 
market segments 
1.219 0.393 
Aggregate Score 3.627 1.296 
Source: Field Data (2019) 
From the findings, the respondents strongly agreed that; segmentation strategy has enabled 
them know to their customers better and to target them better (M=4.610, SD=1.784), 
Segmentation strategy has made customer acquisition easier (M=4.599, SD=1.786), 
engaging in Segmentation strategy has had a positive impact on the firm’s market share 
(M=4.588, SD=1.788), and the firm has segmented its market geographically (M=4.569, 
SD=1.671). Respondents were also in agreement that; the firm considers the quality of a 
market segment before making a strategic decision to target it (M=3.964, SD=1.480), the 
firm conducts a strategic market segment portfolio research and analysis to establish the 
segments to target (M=3.964, SD=1.208), engaging in Segmentation strategy has impacted 
their financial performance and shareholder returns positively (M=3.882, SD=1.409), and 
that the firm has used psychographic segmentation of its market (M=3.825, SD=1.490). The 

47 
findings further showed that the respondents were neutral that the firm has defined its market 
segments narrowly (as opposed to too broadly) to give it a better competitive advantage 
(M=3.241, SD=0.938). Further, the findings established that the respondents were in strong 
disagreement that the firm has segmented its market demographically (M=1.440, SD=0.314) 
and the firm invests in adequate strategic management to reach the targeted market segments 
(M=1.219, SD=0.393). 
The aggregate mean score was 3.627; indications that on average the respondents were in 
agreement with various statements on Segmentation strategy as a strategy in niche strategic 
management. In addition, the respondents didn’t have deviating opinions as indicated by 
aggregate standard deviation value of 1.296. On additional information pertaining 
Segmentation strategy, respondents indicated that the company has not invested well in 
marketing and publicity to reach the targeted segments well. The findings agrees with the 
findings of Yuksel and Yuksel (2016) who asserts that segmentation is among strategic 
management concepts that have been widely accepted; the basis being that to achieve 
competitive advantage, and ultimately high performance, firms should identify profitable 
segments, develop appropriate strategic management mixes for each specifically, and serve 
them well. Therefore, when segmentation is carried out properly it can enhance sales and 
profitability, as it allows the company to target segments that are much more likely to 
patronize and the organization’s products and services. 
4.4.3 Positioning Strategy 
Respondents gave their level of agreement/disagreement with statements on positioning 
strategy as a niche strategy. The findings were as presented in Table 4.5. 

48 
Table 4.5: Descriptive Statistics for Positioning Strategy 
Statement Mean Std. 
Dev. 
The positioning strategy that the firm uses has enabled us charge 
premium prices 
4.551 1.673 
It is correct to say that our customers perceive our products positively 4.534 1.672 
Our firm positions itself as providing products that have unique 
applications compared to competition 
4.529 1.618 
Our firm positions itself as offering more benefits to customers 
compared to competition 
4.503 1.502 
Our firm has positioned itself as being a leader in its market 4.371 1.506 
The positioning strategy that the firm uses has resulted in strengthening 
its market position and becoming more competitive 
4.071 1.146 
The positioning strategy that the firm uses has resulted to higher 
financial performance and shareholder returns 
3.900 1.188 
Our firm’s value proposition is well understood by customers 3.879 1.163 
The positioning strategy (ies) our firm has applied has boosted its brand 
awareness 
3.415 0.859 
The positioning strategy that the firm uses has made customer 
acquisition easier 
3.308 0.894 
Aggregate Score 4.106 1.322 
Source: Field Data (2019) 
From the findings, the respondents strongly agreed that the positioning strategy that the firm 
uses has enabled them charge premium prices (M=4.551, SD=1.673), that it is correct to say 
that their customers perceive their products positively (M=4.534, SD=1.672), their firm 
positions itself as providing products that have unique applications compared to competition 
(M=4.529, SD=1.618) and that their firm positions itself as offering more benefits to 
customers compared to competition (M=4.503, SD=1.502). The findings also revealed that 
the respondents agreed that their firm has positioned itself as being a leader in its market 
(M=4.371, SD=1.506), that the positioning strategy that the firm uses has resulted in 
strengthening its market position and becoming more competitive (M=4.071, SD=1.146), 
the positioning strategy that the firm uses has resulted to higher financial performance and 

49 
shareholder returns (M=3.900, SD=1.188), and that their firm’s value proposition is well 
understood by customers (M=3.879, SD=1.163). 
Further, respondents had neutral feelings on the statement that positioning strategies their 
firm has applied has boosted its brand awareness (M=3.415, SD=0.859) and that the 
positioning strategy that the firm uses has made customer acquisition easier (M=3.308, 
SD=0.894). The aggregate mean was 4.106; an indication that on average, respondents were 
in agreement with various statements on Positioning strategy as a niche strategy. In addition 
the respondents’ opinions were similar since the standard deviation values were less than 
two and the aggregate standard deviation value was 1.322. 
On additional information relating to positioning strategy , respondents indicated that price 
factor is still a challenge as many large contractors still want to make their own concrete 
products for use, especially ready mix concrete – as making it themselves is cheaper than 
buying from us. However those who buy from us do so because of the high quality of BSP 
products – especially for contractors engaged in large projects like high rise buildings, 
bridges, dual carriage roads, dams etc. and need the technical expertise in production of high 
quality concrete that BSP offers. Respondents also explained that despite some contractors 
making their own concrete, they still buy some of their products such as paving blocks and 
other precast concrete products like road and drainage channels, reinforced beams mainly 
because they do not have capacity to make these. 
This study finding concurs with the findings of Blankson et al. (2018) who in his study 
established that firm performance measures like profits, market share, sales, return on 
investment, consumer perceptions, and company image were found to be most impacted 

50 
positively by positioning strategies. The findings also concurs with Blankson and Crawford 
(2016) who in their study established that a direct relationship between positioning strategies 
and firm performance measures like profits, market share, return on investment, sales, and 
consumer perceptions. 
4.4.4 Differentiation Strategy 
Respondents gave their level of agreement/disagreement with statements on differentiation 
strategy as a niche strategy. The findings were as presented in Table 4.6. 
Table 4.6: Descriptive Statistics for Differentiation strategy 
Statement Mean Std. 
Dev. 
Our firm differentiates its products by quality (that they have a higher 
quality) 
4.590 0.307 
Our firm’s differentiation strategy has created customer loyalty 4.545 0.287 
Our firm differentiates its products by features (that they have superior 
features) 
4.511 0.307 
Our firm differentiates its products by value proposition (that they offer 
a higher value) 
4.502 0.296 
Our firm’s products are well differentiated from competitor’s products 
and this helps customers identify them quickly 
4.323 0.206 
Differentiating our products has given our firm competitive advantage 
and increased our market share 
4.059 0.160 
Our Differentiation strategy clearly gives our targeted customer reason 
to buy our products 
4.024 0.199 
Our customers view our firm as different from our competitors in a 
positive way 
4.010 0.187 
Our Differentiation strategy approach has resulted to higher financial 
performance and shareholder returns 
3.997 0.204 
Aggregate Score 4.285 0.239 
Source: Field Data (2019) 
From the findings, the respondents were in strong agreement that their firm differentiates its 
products by quality (that they have a higher quality) (M=4.590, SD=0.307), that their firm’s 
differentiation strategy has created customer loyalty (M=4.545, SD=0.287), that their firm 
differentiates its products by features (that they have superior features) (M=4.511, 

51 
SD=0.307), and their firm differentiates its products by value proposition (that they offer a 
higher value) (M=4.502, SD=0.296). The study also found that the respondents were in 
agreement that their firm’s products are well differentiated from competitor’s products and 
this helps customers identify them quickly (M=4.323, SD=0.206), that differentiating their 
products has given their firm competitive advantage and increased their market share 
(M=4.059, SD=0.160), their Differentiation strategy clearly gives their targeted customer 
reason to buy their products (M=4.024, SD=0.199), their customers view their firm as 
different from their competitors in a positive way (M=4.010, SD=0.187), and that their 
Differentiation strategy approach has resulted to higher financial performance and 
shareholder returns (M=3.997, SD=0.204). 
The study also found that the aggregate mean value was 4.285; indication that on average, 
the respondents agreed with various statements that relate with Differentiation strategy in 
their organization as a niche strategy. The study also established that the respondents had 
similar opinions because all the standard deviation values were less than two and the average 
standard deviation was 0.239. 
In addition to above mentioned practices of differentiation strategy, respondents explained 
that while differentiation strategy has served BSP well there is increased competition with a 
lot of undercutting on prices, and therefore, those competitors are able to convince price 
conscious customers – which have eaten a bit of BSP business. Respondents added that the 
strategy has however helped them single out customers who value their offering and 
therefore cultivated customer loyalty. This study finding concurs with the findings of Adimo 
(2018) who established that differentiating through adopting product attributes superior to 

52 
competition, as well as providing assortment of products that meet various customer needs 
resulted to increased performance. Shafiwu and Mohammed (2017) found in their study that 
differentiation strategy was a profitable strategy suitable for various industries; they added 
that predetermined differentiation strategies that improve performance are pricing, valueadded 
products, operating procedures, distribution network and customer incentives which 
concurs with the findings of our study. 
4.4.5 Firm Performance 
From the open ended questions, the respondents were asked to indicate their opinion on 
whether niche strategy had a positive effect on Bamburi Special Products Limited business 
performance (financial performance, market performance, and shareholder value) and 
explain the reasons for their opinion. In this study, the niche strategies that were considered 
were segmentation strategy, positioning strategy and differentiation strategy. From the 
findings in subsections above, it was observed that Differentiation strategy had the greatest 
aggregate mean (4.285) followed by positioning strategy (4.106), and lastly was 
segmentation strategy with aggregate mean of 3.627. This suggests that differentiation 
strategy had the greatest influence on firm performance followed by positioning strategy and 
segmentation strategy respectively. 
Further, respondents through the open ended questions explained that their organization has 
positively benefited from niche strategy. Their main challenge was with increased 
competition, whose strategy is on price undercutting, therefore, they are challenged to invest 
highly on strategic management to make their offering known to their niche markets. They 
also believed that niche strategy was beneficial because it creates room to diversify their 

53 
product offering to the niche markets (launch new high quality relevant products that are 
needed by the niche markets) to support their revenues, which have been affected in recent 
years by high competition. Respondents added that it could be of importance if they are to 
retain their price premium, and not compete on price like the other competitors; this they 
explained can be achieved through niche strategy. 
Respondents were asked to rate the contribution of niche strategy on the firm performance 
of Bamburi Special Products Limited (BSP). The results obtained were as presented in Table 
4.7. 
Table 4.7: Firm Performance Due to Niche Strategy 
Statement Mean Std. 
Dev. 
Our company has been successful in achieving high financial 
performance in the last 10 years thanks to its niche strategy 
4.512 0.263 
Our firm’s market share is higher than that of other competitors thanks 
to its niche strategy 
4.127 0.238 
It is correct to say that niche strategy has contributed to our firm offering 
its shareholders value for their investment 
4.094 0.225 
Customers view the firm as superior to its competitors as a result of the 
niche strategy it has applied 
3.950 0.211 
Investment analysis indicate a positive future outlook of the firm, as a 
result of its niche strategy 
3.904 0.259 
Our firm’s niche strategy has contributed to the firm having a high brand 
awareness 
3.215 0.164 
BSP has been able to create a defensible/strong position in its market 
thanks to the niche strategy it has adopted 
3.191 0.184 
The niche strategy the firm has adopted has enabled it record high 
revenues over the last 10 years 
3.188 0.157 
Aggregate Score 3.773 0.213 
Source: Field Data (2019) 
The respondents were in strong agreement that their company has been successful in 
achieving high financial performance in the last 10 years thanks to its niche strategy 
(M=4.512, SD=0.263). The study also found that the respondents were in agreement that 

54 
their firm’s market share is higher than that of other competitors thanks to its niche strategy 
(M=4.127, SD=0.238), it is correct to say that niche strategy has contributed to their firm 
offering its shareholders value for their investment (M=4.094, SD=0225), customers view 
the firm as superior to its competitors as a result of the niche strategy it has applied 
(M=3.950, SD=0.211), and that investment analysis indicate a positive future outlook of the 
firm, as a result of its niche strategy (M=3.904, SD=0.259). 
Further, the findings showed respondents had neutral feelings on their firm’s niche strategy 
contributing to the firm having high brand awareness (M=3.215, SD=0.164), BSP being able 
to create a defensible/strong position in its market thanks to the niche strategy it has adopted 
(M=3.191, SD=0.184) and the niche strategy adopted by the firm enabling it record high 
revenues over the last 10 years (M=3.188, SD=0.157). The study also established that the 
aggregate mean value was 3.773 an indication that on average respondents agreed with 
various statements relating with firm performance realized due to niche strategy. In addition, 
the aggregate standard deviation value was 0.213, suggesting that the respondents had 
similar opinions. 
Aside from the aspects covered above on firm performance, respondents added that niche 
strategy has supported their reputation especially in relation to their high quality solutions 
that are specialized to their niche markets. These study findings concurs with the findings of 
Akbar et al., (2017) and Collins (2018) who found evidence to show that the strategy 
provides companies with competitive advantage, high profit margins and strong market 
position; resulting mainly from the high customer satisfaction it achieves. Toften and 
Hammervoll (2019) also explained that niche strategy practices have been used as defensive 

55 
strategy, such that weaker producers keeps away competition by building protective barriers 
around their products, while other companies use it to build their reputation, and even for 
survival which concurs with these study findings. 
4.5 Correlation Analysis 
The study computed correlation analysis to establish the strength and the direction of the 
relationship existing between the dependent and the independent variables. Pearson Product 
Moment Correlation Analysis was used to determine the association. A large correlation 
implies a strong relation exists between the variables. The correlation values obtained were 
interpreted as: small association is indicated by values ranging from 0.1- 0.29, medium 
association is indicated by value ranging from 0.3-0.49, and strong association is indicated 
by value of 0.5 and above. In this study, the independent variables (segmentation strategy, 
positioning strategy, and differentiation strategy) were correlated with the dependent 
variable (Firm Performance). The results obtained were as presented in Table 4.8. 
Table 4.8: Correlation Analysis 
Firm 
Performance 
Segmentation 
strategy 
Positioning 
strategy 
Differentiation 
strategy 
Firm Performance 
Pearson Correlation 1 
Sig. (2-tailed) 
Segmentation Strategy 
Pearson Correlation .866** 1 
Sig. (2-tailed) .000 
Positioning Strategy 
Pearson Correlation .675** .469 1 
Sig. (2-tailed) .000 .000 
Differentiation Strategy 
Pearson Correlation .770** .373 .440 1 
Sig. (2-tailed) .000 .000 .000 
**. Correlation is significant at the 0.01 level (2-tailed). 

56 
From the findings, segmentation strategy had a strong positive relationship with firm 
performance (r=0.866, p=0.000<0.01); positioning strategy has a strong positive relationship 
with firm performance (r=0.675, p= 0.000); and lastly, differentiation strategy was also 
found to have positive relationship with firm performance (r= 0.770, p=0.000<0.01). From 
the findings it is evident that niche strategies (segmentation strategy, positioning strategy, 
and differentiation strategy) had significant relationship with firm performance. This concurs 
with the findings of researchers such as Akbar et al., (2017) and Collins (1994) that the 
strategy provides companies with competitive advantage, high profit margins and strong 
market position; resulting mainly from the high customer satisfaction it achieves. 
4.6 Test for Regression Analysis’ Assumptions 
Multiple regression analysis was used to determine the effects of niche strategy on firm 
performance of Bamburi Special Products Limited in Kenya. To ensure results from 
regression analysis are efficient, the study tested the five key assumption of linear regression. 
These assumptions are; normality, no autocorrelation, no or little multicollinearity, 
homoscedasticity and linear relationship. In case any of the assumptions of regression is 
violated, then confidence intervals and other scientific understandings from a regression 
model may be inefficient, biased or even misleading. 
4.6.1 Tests of Normality 
Linear regression assumes that variables’ data is normally distributed or is from a normal 
population. Data that is non-normally distributed can distort associations between different 
variables. This study used Shapiro–Wilk test to examine the normality of data. The null 
hypothesis in Shapiro–Wilk test is that the variables have no normally distributed data. 

57 
Therefore, for variables to have normally distributed data, p-value has to be more than the 
significance level (0.05). 
According to the findings, as shown in Table 4.9, the p-values of all the variables were above 
0.05. Segmentation strategy (p-value=0.098), positioning strategy (p-value=0.141), 
differentiation strategy (p-value=0.231), and firm performance (p-value=0.173). Since the 
p-values were greater than the significance level (0.05), we rejected the null hypothesis and 
accepted the alternative that the variables are normally distributed. The data therefore met 
the normality assumption and thus regression analysis can be computed. 
Table 4.9: Shapiro-Wilk Test 
Shapiro-Wilk 
Statistic df Sig. 
Segmentation Strategy .921 45 .098 
Positioning Strategy .930 45 .141 
Differentiation Strategy .836 45 .231 
Firm Performance .932 45 .173 
Source: Field Data (2019) 
4.6.2 Autocorrelation Test 
Autocorrelation in this study was tested by use of Durbin–Watson statistic and results 
presented in Table 4.10. Statistically, Durbin–Watson statistic is a statistical test used in 
detecting autocorrelation in regression analysis residuals. Durbin–Watson statistic can 
assume values ranging from 0 to 4. The rule of the thumb in this test statistic is that values 
between 1.5 and 2.5 (1.5 < d < 2.5) show that there is no autocorrelation in the data (Cooper 
& Schindler, 2016). In this study, Durbin–Watson statistic was 1.850, which lies between 

58 
1.5 and 2.5. This implies that there is no autocorrelation in the data and therefore multiple 
regression can be computed. 
Table 4.10: Durbin–Watson statistic 
Model Durbin-Watson 
1 1.850 
Source: Field Data (2019) 
4.6.3 Multicollinearity Test 
Multicollinearity is a statistical concept showing the likelihood that two or more independent 
variables in a multiple regression model are significantly or highly correlated (Creswell, 
2018). This is an undesirable event if the correlations among the independent variables are 
strong, because it increases the coefficients’ standard errors. To measure the presence of 
multicollinearity, the study used Variance Inflation Factor (VIF). The rule of the thumb is 
that a Variance Inflation Factor that is more than 10 warrants further investigation (Russell, 
2016). 
The VIF values found in Table 4.11 show that, there was no multicollinearity among the 
independent variables, since all the values were below 3. Segmentation strategy had a VIF 
of 1.788, positioning strategy had a VIF of 2.195, and differentiation strategy had VIF of 
1.740. This implies that the results of multiple regression equation are not misleading, since 
independent variables in the multiple regression equation are not highly correlated among 
themselves. 

59 
Table 4.11: Collinearity Statistics 
Tolerance (1/VIF) VIF 
Segmentation Strategy, .559 1.788 
Positioning Strategy .456 2.195 
Differentiation Strategy .575 1.740 
Source: Field Data (2019) 
4.6.4 Heteroscedasticity and Homoscedasticity Test 
Homoscedasticity violations make it difficult to evaluate forecast errors’ standard deviation, 
which usually result to confidence intervals that are too narrow or too wide (Bryman & 
Cramer, 2016). In this study, Heteroscedasticity was tested by conducting the Breusch- 
Pagan/Cook-Weisberg test. The results of the test are presented in Table 4.12. The null 
hypothesis for this test is that the error variances are all equal versus the alternative that the 
error variances are a multiplicative function of one or more variables. According to Bryman 
and Cramer (2016), homoscedasticity is usually evident when the p-value is greater than the 
significance level (0.05). According to the findings, the p-value (0.098) was greater than the 
significance level (0.05), which shows that there was no heteroscedasticity in the data. 
Table 4.12: Breusch-Pagan / Cook-Weisberg test for heteroscedasticity 
Ho: Constant variance 
Chi2 (1) 6.67 
Prob>chi2 0.098 
Source: Field Data (2019) 
4.7 Regression analysis 
Since the data met all the assumptions for regression analysis, the study regressed firm 
performance with segmentation strategy, positioning strategy, and differentiation strategy 

60 
with the aim of establishing how niche strategies affect firm performance. The findings were 
discussed in subsections below. 
4.7.1 Model Summary 
Model summary is used to determine the amount of variation in dependent variable that can 
be explained by changes in the independent variables. In this study, the amount of variation 
in firm performance as a result of change in segmentation strategy, positioning strategy and 
differentiation strategy was sought. 
Table 4.13: Model Summary 
Model R R Square Adjusted R Square Std. Error of the Estimate 
1 .861a .741 .723 .09275 
a. Predictors: (Constant), Segmentation strategy, Positioning strategy , Differentiation 
strategy 
Source: Field Data (2019) 
From the findings, the value of adjusted R2 was 0.723 suggesting that 72.3% variation in 
firm performance of Bamburi Special Products can be explained by changes in segmentation 
strategy, positioning strategy and differentiation strategy. The remaining 27.7% suggest that 
there are other factors that can be attributed to change in firm performance that were not 
discussed in this project; this warrants a study to be conducted in the future to examine these 
factors. The study also established that the variables under investigation are strongly and 
positively elated as indicated by correlation coefficient value (R) of 0.861. 
4.7.2 Analysis of Variance 
Analysis of variance is used to determine significance of the model developed. In this study, 
significance of the model was tested at 5% level of significance. 

61 
Table 4.14: ANOVA 
Model Sum of Squares df Mean Square F Sig. 
1 
Regression 21.048 3 7.016 17.154 .000b 
Residual 16.769 41 0.409 
Total 37.817 44 
a. Dependent Variable: Firm Performance 
b. Predictors: (Constant), segmentation strategy, positioning strategy, differentiation 
strategy 
Source: Field Data (2019) 
From the findings, the p-value obtained (0.000) was less than the selected level of 
significance (0.05); this therefore suggests that the model is significant and can be used to 
predict firm performance of Bamburi Special Products Limited. The findings also revealed 
that the f-calculated value (17.154) was greater than the f-critical value (2.833) an indication 
that segmentation strategy, positioning strategy and differentiation strategy significantly 
influence firm performance of Bamburi Special Products Limited in Kenya. 
4.7.3 Beta Coefficients of the Study Variables 
Table 4.15: Coefficients 
Model Unstandardized 
Coefficients 
Standardized 
Coefficients 
t Sig. 
B Std. Error Beta 
1 
(Constant) 0.835 0.083 10.060 .000 
Segmentation strategy 0.545 0.082 0.54 6.646 .003 
Positioning strategy 0.383 0.045 0.356 8.511 .007 
Differentiation strategy 0.746 0.104 0.722 7.173 .000 
a. Dependent Variable: Firm Performance 
Source: Field Data (2019) 
From the findings, the fitted regression equation was; 
Y = 0.835 + 0.545 X1 +0.383 X2 + 0.746 X3 + έ 

62 
Where Y is firm performance level; X1 is segmentation strategy, X2 positioning strategy and 
X3 differentiation strategy; and έ represents unexplained variables not explained by the 
model. 
From the above regression equation, it is evident that holding the variables segmentation 
strategy, positioning strategy and differentiation strategy to a constant zero, firm 
performance will be at a constant value of 0.835. These findings also show that by 
segmentation strategy had positive influence on performance (β=0.545), positioning strategy 
also had positive influence on influence on performance (β=0.383) and lastly differentiation 
strategy had the greatest influence on performance (β=0.746). The influence of these 
variables on firm’s performance was significant since their p-values were less than the 
selected level of significance (0.05). The study discussed the effect of each independent 
variable on firm performance. 
On segmentation strategy, the findings show that segmentation strategy has a positive 
influence on firm performance of Bamburi Special Products Limited in Kenya (β=0.545). 
The influence of segmentation strategy on firm performance was found to be significant 
since the p-value obtained (0.003) was less than selected significance level (0.05). Therefore 
it can be deduced that segmentation positively and significantly influences firm performance 
of Bamburi Special Products Limited in Kenya. This simply means that a unit increase in 
segmentation strategy will result to an increase in firm performance by 0.545 units. This 
concurs with the findings of a number of researches for example, Wind and Bell (2017) who 
revealed that when done effectively segmentation increases customer appeal on the firm’s 
products, and reduces costs of reaching customers and chances of new product or service 

63 
failure; also, Gensch (2019) presented compelling evidence of the positive effects of 
segmentation strategy in electrical equipment business which concurs with this study 
findings. 
The study found that positioning strategy has a positive influence on firm performance of 
Bamburi Special Products Limited in Kenya (β=0.383). The study further established that 
the influence of positioning strategy on firm performance was significant since the p-value 
obtained (0.007) was less than the selected level of significance (0.05). Therefore, a unit 
increase in positioning strategy will result to an increase in firm performance by 0.383 units. 
These findings therefore show that positioning strategy positively and significantly influence 
firm performance of Bamburi Special Products Limited in Kenya. The finding agrees with 
Mokaya et al. (2016) who revealed positioning strategy to be prioritized in the company’s 
niche strategy, and to be contributing positively to performance. It also concurs with findings 
of Blankson and Crawford (2016) that there is direct relationship between positioning 
strategies and firm performance measures like profits, market share, return on investment, 
sales, and consumer perceptions. 
Further, the study established that differentiation strategy positively influences firm 
performance of Bamburi Special Products Limited in Kenya (β=0.746). The influence was 
found to be significant since the p-value obtained (0.000) was less than the selected level 
(0.005). This simply means that a unit increase in Differentiation strategy will result to an 
increase in firm performance by 0.746 units. Based on these findings, it was deduced that 
differentiation strategy positively and significantly influences firm performance of Bamburi 
Special Products Limited in Kenya. This study finding is in agreement with Haarla (2016) 

64 
who investigated whether or not strategy provides competitive advantage and the results 
established a positive relationship with technology being a key differentiator. It also concurs 
with findings of Nolega et al. (2015) indicating a steady rise in the company’s customer base 
for a period of 15 years as a result of differentiation strategy strategies, categorically product 
quality. 
From these study findings, differentiation strategy seems to have the greatest variance 
whereas positioning strategy has the least. Further it found that BSP did not invest in 
appropriate niche strategies to support positioning strategy, which would explain why this 
particular niche strategy is not as effective on firm performance of BSP as differentiation 
strategy and segmentation strategy. These findings are similar to Kotler (2016) who 
suggested that firms have to communicate its positioning effectively to its customers for it 
to work well to support firm performance. Aaker and Shansby (2016), Sujan and Betman 
(2019) and Ambler and Vakratsas (2019) suggest effective advertising to support product 
positioning matched with the product category and stage of product life cycle. Advertising 
is a promotional tool which helps to position a product/brand (Chowdhury, 2016). Further 
Marken (2017) suggested that both advertising and Public Relations play an important roles 
and each should support and reinforce the company's and product's position. Marken (2017) 
also suggested that firms and their agencies should direct all of their communication efforts 
to the specific position that they want to achieve and to reinforce it with all promotional tools 
(PR, advertising, sales promotion, sales contacts, on-line communications etc.). 

65 
CHAPTER FIVE: SUMMARY, CONCLUSIONS AND RECOMMENDATIONS 
5.1 Introduction 
In this chapter summary of key findings is presented, conclusions drawn from the findings 
are highlighted and study recommendation are detailed. Conclusions and suggestions were 
focused on addressing the research objectives. 
5.2 Summary of the Findings 
In this section, the study presents summary of study findings based on the specific objectives 
of the study. The study was guided by the following specific objectives: to investigate the 
effects of segmentation strategy on the firm performance of Bamburi Special Products 
Limited in Kenya; to ascertain the effects of positioning strategy on the firm performance of 
Bamburi Special Products Limited in Kenya; and to establish the effects of differentiation 
strategy on the firm performance of Bamburi Special Products Limited in Kenya. 
5.2.1 Segmentation strategy on Firm Performance 
The study found that segmentation strategy influenced firm performance. From the 
correlation analysis, the study established that segmentation strategy had a strong, positive 
and significant influence on firm performance (r=0.866, p=0.000<0.01). On regression 
analysis, the study found that segmentation strategy has a positive significant influence on 
firm performance of Bamburi Special Products Limited in Kenya (β=0.545, p=0.003). 
Therefore niche strategy positively and significantly influences firm performance of 
Bamburi Special Products Limited in Kenya. Therefore, when segmentation strategy is 
carried out properly it can enhance sales and profitability, as it allows the company to target 

66 
segments that are much more likely to patronize and the organization’s products and 
services. 
5.2.2 Positioning Strategy on Firm Performance 
The study found that positioning strategy that Bamburi Special Products Limited influences 
firm performance. Correlation findings showed that positioning strategy and firm 
performance had strong positive relationship (r=0.675, p= 0.000). The study further 
established that positioning strategy has a positive significant influence on firm performance 
of Bamburi Special Products Limited in Kenya (β=0.383, p=0.007). Therefore, a unit 
increase in positioning strategy will result to an increase in firm performance. These findings 
therefore show that positioning strategy positively and significantly influence firm 
performance of Bamburi Special Products Limited in Kenya. 
5.2.3 Differentiation Strategy on Firm Performance 
The study found that Bamburi Special Products Limited differentiates its products by quality 
(that they have a higher quality), by features (that they have superior features), by value 
proposition (that they offer a higher value) and that differentiation strategy has created 
customer loyalty. From correlation analysis, the study established that Differentiation 
strategy has positive relationship with firm performance (r= 0.770, p=0.000<0.01). The 
study further established that differentiation strategy positively and significantly influences 
firm performance of Bamburi Special Products Limited in Kenya (β=0.746, p=0.000). 
Therefore, a unit increase in differentiation strategy will result to an increase in firm 
performance by 0.746 units. 

67 
5.3 Conclusion 
Conclusions were drawn based on the study findings and were presented based on the 
specific objectives. 
5.3.1 Effects of Segmentation Strategy on Firm Performance of Bamburi Special 
Products Limited in Kenya 
The study found that segmentation strategy has a positive influence on firm performance of 
Bamburi Special Products Limited in Kenya. The study also found that the influence of 
segmentation strategy on firm performance was significant implying that segmentation 
positively and significantly influences firm performance of Bamburi Special Products 
Limited in Kenya. The study therefore concludes that a unit increase in Segmentation 
strategy results to improved firm performance of Bamburi Special Products Limited in 
Kenya 
5.3.2 Effects of Positioning Strategy on Firm Performance of Bamburi Special Products 
Limited in Kenya 
The study found that positioning strategy has a positive influence on firm performance of 
Bamburi Special Products Limited in Kenya. The study further established that the influence 
of positioning strategy on firm performance was significant suggesting that Positioning 
strategy positively and significantly influence firm performance of Bamburi Special 
Products Limited in Kenya. The study therefore concluded that increasing positioning 
strategy will result to improved firm performance of Bamburi Special Products Limited in 
Kenya. 

68 
5.3.3 Effects of Differentiation Strategy on Firm Performance of Bamburi Special 
Products Limited in Kenya 
The study established that differentiation strategy positively influences firm performance of 
Bamburi Special Products Limited in Kenya. The influence was found to be significant 
suggesting that differentiation strategy positively and significantly influences firm 
performance of Bamburi Special Products Limited in Kenya. The study therefore concludes 
that an increase in differentiation strategy will result to an increase in firm performance of 
Bamburi Special Products Limited in Kenya. 
5.4 Recommendations 
5.4.1 Recommendations for Policy 
The study found that niche strategies have positive influence of firm performance. The study 
therefore recommends the government to provide these companies with a favorable 
environment that will favor their operations and growth; for instance providing them with 
affordable power supply, and supportive policies for the industry that will guard companies 
from challenges like low completion rate of construction projects, low access to affordable 
project financing, lengthy procurement procedures, and inadequate harmony in policies, 
laws and regulations. The government should also develop policies that will discourage 
importation of cement and concrete products and therefore decrease competition rates and 
create more market for products produced within the country. 
Segmentation strategy was found to have positive influence on firm performance. The study 
also recommends policy makers in Bamburi Special Products Limited to develop policies 
that will guide the company to apply various statistical techniques in segmenting its market; 

69 
some of the techniques that can be applied are conjoint analysis, cluster analysis, factor 
analysis, logistical regression analysis, multidimensional scaling and canonical analysis. 
5.4.2 Recommendations for Practice 
Since segmentation strategy has a positive influence on firm performance, the study 
recommends Bamburi Special Products Limited to improve its segmentation strategy 
especially demographically and also invest adequately in strategic management to reach the 
targeted market segments. 
Since positioning strategy improves firm performance, the study recommends management 
of Bamburi Special Products Limited to uniquely position itself, to create a clearly defined 
and attractive image in the target customer’s minds. The study also recommends the 
company management to position itself based on key advantages like being the market 
leader, innovation, extensive capacity, convenience and other benefits. It is important for the 
company to consider attributes that are relevant, meaningful and valuable to its customers. 
Knowing that differentiation strategy positively influences firm performance, the study 
recommends the company to conduct a market research to establish the extent to which the 
company’s offering or products are perceived as favorable, different and credible in 
consumers’ minds; this will enable the company to develop offerings that are unique and 
meet customer needs and expectation. Success is when customers perceive the firm’s 
offering as superior to competitors, due to attributes highlighted in its niche strategy; 
perceptions directly affect purchase decisions, and the company should therefore implement 
strategies that will change customers’ perception of the company positively. 

70 
5.5 Suggestions for Further Studies 
This study sought to determine the effects of niche strategy on firm performance of Bamburi 
Special Products Limited in Kenya and established that 72.3% variation in firm performance 
can be explained by changes in niche strategies (segmentation strategy, positioning strategy, 
and differentiation strategy). This study focused on Bamburi Special Products Ltd; the study 
therefore recommends a study to be conducted among other concrete manufacturing 
companies in the country to facilitate comparison and generalization of the research findings. 
The study explained 72.3% of firm performance; the study thus recommends a study to be 
conducted on other aspects of niche strategy that can explain the remaining 27.7%. To 
facilitate generalization and comparison of the research findings, the study recommends 
replication of the research study in other sectors of the market such as food manufacturing 
companies. Further, this study focused on niche strategies and therefore recommends 
research to be conducted on Porter’s generic strategies and firm performance of Bamburi 
Special Products Limited in Kenya. Recommendation is also made for further study of niche 
strategy as a corporate level strategy. 

71 
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APPENDICES 
Appendix I: Letter of Introduction 
To Whom It May Concern 
September 2019 
Catherine Ndioo 
P.O Box 7999 – 01000, 
Thika. 
Dear Sir/Madam, 
Re: Research Participation 
The above stated is a final year MBA student at Kenyatta University. As a condition for the 
course, she is required to conduct a research project, and the selected title of her study is 
‘NICHE STRATEGY AND FIRM PERFORMANCE OF BAMBURI SPECIAL 
PRODUCTS LIMITED IN KENYA’. This is to request you to kindly participate in the 
study by providing relevant information related to your company; by completing the attached 
questionnaire. Data collected shall be used exclusively to answer the research questions and 
not for any other purpose. Your identity shall be concealed and the information provided 
treated with adequate confidentiality. If any clarification is required, kindly reach the 
researcher on 0720805940 or contact the university directly. 
Sincerely, 

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Appendix II: Questionnaire 
This questionnaire is designed to gather information on the effects of niche strategy on the 
firm performance of Bamburi Special Products Limited in Kenya, and is purely for 
academic purposes only. Kindly provide the information requested for all items in the 
questionnaire by indicating a tick (✔) on the option corresponding to your answer. For 
questions that require your own opinion, fill in the blanks (…………………………) 
SECTION A: GENERAL INFORMATION AND BIO DATA 
1. Your level in the organization (optional) 
a) Top Management c) Supervisory level 
b) Middle Management d) Others 
2. For how long have you worked in the organization 
a) 0-3 years c) 8 – 11 years 
b) 4-7 years d) 12 years and above 
3. Highest level of education? 
a) High School c) University – Undergraduate 
b) College d) University – Postgraduate and above 
SECTION B: NICHE PRACTICES 
4. i) The following are some of the types of niche strategies. Kindly indicate which ones 
your organization practices 
a) Segmentation strategy 
b) Positioning strategy 
c) Differentiation strategy 

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d) Other ……………………………………………………………………………. 
ii) Kindly explain the reason behind your firm entering into these kind of niche 
practices stated above 
……………………………………………………………………………………… 
……………………………………………………………………………………… 
……. 
5. i) What is the main objective for your company to engage in niche strategies (Please 
mark your answer with a tick (✔) using the scale 1- 5, where 1= Strongly Disagree, 2= 
Disagree, 3 = Neutral, 4= Agree, 5= Strongly Agree. Please indicate only one response 
per statement) 
Statement 5 4 3 2 1 
To increase revenue and profit 
To provide superior customer value through meeting their 
needs better 
To achieve brand loyalty 
To have a competitive advantage and compete effectively in 
the market 
To utilize the strategic management budget better 
To generate higher margins by serving specific niches 
To enhance the company image 
To sustain company success over the long term 

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ii) What other objective leads your firm into adopting the niche strategy 
.................................................................................................................................................. 
.................................................................................................................................................. 
........ 
6. Please indicate the extent to which you concur with the following statements concerning 
the various niche strategies, using the following rating; 5 = to a very large extent, 4 = 
Large extent, 3 = Moderate extent, 2 = Small extent, 1 = Very small extent 
a) Segmentation Strategy 
i) 
Statement 5 4 3 2 1 
The firm has segmented its market geographically 
The firm has segmented its market demographically 
The firm has used psychographic segmentation of its market 
Engaging in segmentation strategy has impacted our financial 
performance and shareholder returns positively 
Engaging in segmentation strategy has had a positive impact 
on the firm’s market share 
Segmentation strategy has made customer acquisition easier 
Segmentation strategy has enabled us know our customers 
better and to target them better 
The firm has defined its market segments narrowly (as opposed 
to too broadly) to give it a better competitive advantage 

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The firm considers the quality of a market segment before 
making a strategic decision to target it 
The firm conducts a strategic market segment portfolio 
research and analysis to establish the segments to target 
The firm invests in adequate strategic management to reach the 
targeted segments 
ii) What additional information is not captured above relating to the segmentation 
strategy your firm uses 
……..………………………………………………………………………………… 
……………………………………………………………………………………...... 
........ 
b) Positioning Strategy 
i) 
Statement 5 4 3 2 1 
Our firm positions itself as offering more benefits to customers 
compared to competition 
Our firm positions itself as providing products that have unique 
applications compared to competition 
Our firm has positioned itself as being a leader in its market 
The positioning strategy (ies) our firm has applied has boosted 
its brand awareness 
Our firm’s value proposition is well understood by customers 

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It is correct to say that our customers perceive our products 
positively 
The positioning strategy that the firm uses has resulted to 
higher financial performance and shareholder returns 
The positioning strategy that the firm uses has enabled us 
charge premium prices 
The positioning strategy that the firm uses has resulted has 
made customer acquisition easier 
The positioning strategy that the firm uses has resulted in 
strengthening its market position and becoming more 
competitive 
ii) What additional information is not captured above relating to your 
Positioning strategy 
.……………………………………………………………………………… 
……………………………………………………………………………… 
…… 
c) Differentiation Strategy 
i) 
Statement 5 4 3 2 1 
Our firm’s products are well differentiated from competitor’s 
products and this helps customers identify them quickly 

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Our firm differentiates its products by features (that they have 
superior features) 
Our firm differentiates its products by quality (that they have a 
higher quality) 
Our firm differentiates its products by value proposition (that 
they offer a higher value) 
Differentiating our products has given our firm competitive 
advantage and increased our market share 
Our firm’s differentiation strategy has created customer loyalty 
Our differentiation strategy clearly gives our targeted customer 
reason to buy our products 
Our customers view our firm as different from our competitors 
in a positive way 
Our differentiation strategy approach has resulted to higher 
financial performance and shareholder returns 
ii) What additional information is not captured above relating to the 
Differentiation strategy that your firm uses 
…….………………………………………………………………………… 
……………………………………………………………………………… 
…… 

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SECTION C: FIRM PERFORMANCE 
7. In your opinion, has niche strategy had a positive effect on Bamburi Special Products 
Limited business performance (financial and non-financial performance)? Explain 
……………………………………………………………………………………………… 
……………………………………………………………………………………………… 
……………… 
8. How would you rate the contribution of niche strategy on the firm performance of 
Bamburi Special Products Limited (BSP)? 
Using the following rating; 5 = to a very large extent, 4 = Large extent, 3 = Moderate 
extent, 2 = Small extent, 1 = Very small extent 
Statement 1 2 3 4 5 
BSP has been successful in achieving high profitability in the last 10 
years thanks to its niche strategy 
Our firm’s market share is higher than that of other competitors 
thanks to its niche strategy 
The niche strategy the firm has adopted has enabled it record high 
revenues over the last 10 years 

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Our firm’s niche strategy has contributed to the firm having a high 
brand awareness 
The firm delivers high customer satisfaction as a result of the niche 
strategy it has applied 
It is correct to say that the niche strategy applied has resulted in the 
company offering high quality solutions 
It is correct to say that the niche strategy applied has resulted in the 
company delivering superior innovation 
9. What other aspect of firm performance (not covered above) has your organization 
realized due to niche strategy 
……………………………………………………………………………………………… 
……………………………………………………………………………………………… 
…………………………………………………… 
THANK YOU SO MUCH FOR YOUR TIME 

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Appendix III: Budget Estimates 
ITEM AMOUNT (KSHS) 
Proposal Development 
Stationery, printing and photocopying 4,000 
Telephone and internet costs 2,000 
Data Collection and Analysis 
Research assistants – 2 10,000 
Data capturing and analysis 25,000 
Compilation and Production of Final Document 
Printing 7,000 
Binding 4 copies 4,000 
Total 52,000 

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Appendix IV: Work Plan 
2018 2019 2020 
Activities Dec Jan July Aug Sept Oct Nov Dec Jan Feb Mar 
Proposal writing 
Proposal presentation 
Data collection 
Data analysis and report 
writing 
Project submission