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Effect of Digital Marketing on Competitiveness of Automobile Companies in Kenya

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Effect of Digital Marketing on Competitiveness of Automobile Companies in Kenya EFFECT OF DIGITAL MARKETING ON COMPETITIVENESS OF AUTOMOBILE COMPANIES IN KENYA BY KIGUNDA EVA NKATHA UNITED STATES INTERNATIONAL UNIVERSITY - AFRICA SUMMER 2017 EFFECT OF DIGITAL MARKETING ON COMPETITIVENESS OF AUTOMOBILE COMPANIES IN KENYA BY KIGUNDA EVA NKATHA A Research Project Report Submitted to the Chandaria School of Business in Partial Fulfillment of the Requirement for the Degree of Masters in Business Administration (MBA) UNITED STATES INTERNATIONAL UNIVERSITY - AFRICA SUMMER 2017 STUDENT’S DECLARATION I, the undersigned, declare that this is my original work and has not been submitted to any other university or college institution or except the United States International University - Africa in Nairobi for academic credit. Signed :_____________________________ Date: ________________________ Kigunda Eva Nkatha (ID No: 648325) This research project report has been submitted for examination with my consent as the appointed supervisor. Signed: _______________________ Date: _________________________ Dr. Peter Kiriri Signed: _______________________ Date: _________________________ Dean, Chandaria School of Business ii COPYRIGHT Copyright © Kigunda Eva Nkatha, 2017 All rights reserved. iii ABSTRACT The study sought to examine the effect of digital marketing on competitiveness of automobile companies in Kenya. The objectives of the study were to assess the effect of search engine marketing, e-mail advertising, online advertising and social media advertising on the competitiveness of automobile companies in Kenya. This study embraced the use of a descriptive research design. The target population of this study was 335 staff working in the marketing departments at the head offices of 11 major established motor vehicle dealers in Kenya. The study applied stratified random sampling in selecting 30% of the target population. The sample size of the study came to 101 respondents. The study utilized primary data that was gathered utilizing semi- structured questionnaires. Inferential and descriptive measurements of statistics were utilized to evaluate the quantitative data while making use of the Statistical Package for Social Sciences (SPSS version 20). Descriptive statistics utilized percentages, frequencies, means and standard deviations. Inferential statistics in the study included correlation analysis and regression analysis were used to determine the relationship between the study’s independent variable and the dependent variable. The study used figures and tables to present the analyzed data. The study showed that Search Engine Marketing had allowed firms to create solutions and plans to attract consumers to their products and services, and was used in the organizations to increase the position of the companies and their products in the results listings for selected keywords and phrases. Search Engine Marketing had been used to increase links from other websites to the companies’ web pages, even though its factors were notoriously difficult to enumerate. The companies had good websites with a good design used to attract, and retain customers, and using SEM for advertisement had enabled the companies to gain more new customers, however, search engines’ revenues are typically lower when companies spend more on Search Engine Marketing. The study indicated that the e-mail marketing model had not been developed from the ground up to avoid the companies playing catch up, and the companies did not use e-mail marketing software to send promotional mails to their consumers. E-mail advertising recipients were normally consumers who had not opted to receive such emails, although iv the service provided consistent and better customer experience, thus maximizing the companies’ potential in enhancing their competitiveness. The study showed that technology advancement had created the possibility for the firms to engage with clients who were internet users through online advertising, and this had made it easier for the companies to update product and service information promptly. Online advertising was not used to reach and cover a larger target audience and reach broader geographical areas at a lower cost, but was used by the firms to understand their consumers, and generate and manage close relationships with them. The study pointed out that the current business environment had compelled the companies to adopt social media marketing, however, they did not use Twitter to promote and answer their customer concerns and complaints in real-time. Social media marketing had enabled the firms and their customers, to be more effective and productive in receiving and providing service and response, but it had not allowed the companies to enjoy the creation and exchange of user-generated content about their products and services. The study concludes that search engines play a great role in linking firms when using the Internet to build company image and find target customers. Interactive e-mail responses to the company’s e-mail advertisements helped them to develop a strong relationship with their customers, and their e-mail marketing campaigns had produced twice the return on investment compared to other forms of online marketing. The study recommends the management of the Kenyan automobile companies to secure a system that would facilitate their ability to enumerate SEM factors in their organizations. This would enable them to understand their ROI from SEM investment which would facilitate their ability to make it advantageous to the firm since search engines’ revenues are lowered by huge spending on SEM. v ACKNOWLEDGEMENT The procedure of this research study has been a brilliant learning experience in my scholarly life. It was loaded with difficulties and rewards. The fulfillment of my present research study prompts a fresh start and a step forward in my plans and endeavors. I am appreciative to God for his boundless beauty and for empowering me to begin and finish my studies without hindrances. Am most obligated to my supervisor Dr. Kiriri for his unique supervision, support, patience, help, support and diligent assistance on matters relating to this study. Am also grateful to United States International University - Africa in Nairobi for allowing me to pursue my Master’s Degree in Business Administration. Additionally, I wish to appreciate the help, support and encouragement that I received from my family and companions during my research period. They made it feasible for me to strike the balance between my family and academic obligations. I am likewise appreciative of my manager/ supervisor and colleagues whom I may not mention because they are many for their constant encouragement that echoed throughout my coursework, and some of whom helped me source for materials to accomplish my MBA course successfully. vi DEDICATION This study is dedicated to my family for their generous sacrifice, understanding and support during the research and my study. vii TABLE OF CONTENTS STUDENT’S DECLARATION ....................................................................................... ii COPYRIGHT ................................................................................................................... iii ABSTRACT ...................................................................................................................... iv ACKNOWLEDGEMENT ............................................................................................... vi DEDICATION................................................................................................................. vii LIST OF TABLES .............................................................................................................x LIST OF FIGURES ........................................................................................................ xii LIST OF ABBREVIATIONS ....................................................................................... xiii CHAPTER ONE ................................................................................................................1 1.0 INTRODUCTION........................................................................................................1 1.1 Background of the Study ...............................................................................................1 1.2 Statement of the Problem ...............................................................................................4 1.3 Purpose of the Study ......................................................................................................4 1.4 Research Questions ........................................................................................................5 1.5 Significance of the Study ...............................................................................................5 1.6 Scope of the Study .........................................................................................................6 1.7 Definition of Terms........................................................................................................6 1.8 Chapter Summary ..........................................................................................................7 CHAPTER TWO ...............................................................................................................8 2.0 LITERATURE REVIEW ...........................................................................................8 2.1 Introduction ....................................................................................................................8
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