Marketing Mix and Performance of Micro Finance Institutions in Nakuru Town, Kenya
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Date
2025-12
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Kenyatta University
Abstract
Numerous scholars have noted that Kenyan microfinance institutions continue to suffer a variety of performance-related issues. These Microfinance Institutions deal with a variety of performance issues, such as their capacity to draw in and keep clients. The rivalry for clients has intensified due to the emergence of sophisticated financial technology businesses that target the market historically served by Microfinance Institutions and offer financial services like loans via mobile devices. As a result, Microfinance Institutions are becoming more and more dependent on implementing marketing mix strategies to improve their performance and acquire a competitive edge. Thus, this study's objective was to ascertain how the marketing mix affects the performance of microfinance organizations in Nakuru Town, Kenya. The research's specific objectives were to investigate how pricing decisions, place decisions, promotion decisions, and product design decisions affect performance. The product life cycle theory, balanced scorecard model, and marketing mix theory served as guiding principles for the research. Explanatory and descriptive research designs were used in this investigation. Using stratified random sampling, the study's target population included one branch manager, one operations manager, and five operations employees from each microfinance institution, totalling 78 respondents. The validity of the research instrument (questionnaire) was assessed through expert evaluation by the expert judges, who reviewed the items for representativeness and relevance to the content area. A structured questionnaire was employed to gather data. Data collection procedures involved seeking approvals and using Drop Off and Pick Up method. The reliability was tested using Cronbach's alpha coefficient, with values above 0.7 for all variables indicating high internal consistency and reliability. Data was analyzed using Statistical Package for the Social Sciences software through both descriptive and inferential statistics. The regression analysis revealed that pricing decisions (β=0.589, p=0.002), place strategies (β=0.621, p<0.001), promotion strategies (β=0.673, p<0.001), and product design (β=0.520, p<0.001) all had statistically significant positive effects on Microfinance Institution performance. The study concluded that pricing decisions, place strategies, promotion strategies, and product design decisions all significantly affect the performance of Microfinance Institutions in Nakuru Town, Kenya. The study recommends that Microfinance Institutions conduct regular market research, implement flexible pricing structures, expand outreach through partnerships and digital solutions, develop integrated marketing communication strategies, invest in product innovation, and provide staff training to optimize their marketing mix and enhance overall performance.
Description
A Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfilment of the Requirement for the Award of Degree in Master of Business Administration (Marketing Option) of Kenyatta University, December 2024
Supervisors;
1.Anne Muchemi