INFLUENCE OF MARKETING STRATEGIES ON ATTRACTION OF INTERNATIONAL CUSTOMERS IN THE HOTEL INDUSTRY IN NAIROBI, KENYA, C WAMALWA

Tags: performance, product, marketing mix, international customers, Kenya, marketing strategies, hospitality industry, Hotels in Nairobi, market share, Nairobi, respondents, marketing, tourism industry, Research Data, Billboards, Services Hotels, market, strategic marketing, star hotels, Nairobi County, Pearson Education, Inc., Journal of Marketing, Verbal Communication, USA Hauser R., Oxford Handbook of Pricing Management, European Journal of Marketing, Radio and Television, Marketing Manager, relational marketing, tourist attractions, Performance Kotler, pricing strategies, market behaviour, marketing managers, target, Accommodation, Hotels, Marketing executives, communication, Frequency Banqueting, Livingston John Tribe, Strategic Marketing Management, Journal of Business, Energy Economics Vol, Marketing Management, Journal of the Academy of Marketing Science, Oxford University Press, Marketing for Hospitality & Tourism, Marketing Theory, Domestic tourism, performance management, financial indicators, American Marketing Association Milton Friedman, American Marketing Association, hotels in Nairobi county, Pearson Education, Association, Annals of Tourism Research Traditions of Sustainability, England Kotler P., Social media, Analysis Journal of Marketing, Butterworth Heinemann, Aldine Transaction Nelson Q., Services Marketing Theory, Service Marketing Theory, Kenya Association of Hotels and Caterers Kenya Hotel & Restaurant, marketing communication, Relationship Marketing, Takahiro Fujimoto, Nairobi, Kenya
Content: INFLUENCE OF MARKETING STRATEGIES ON ATTRACTION OF INTERNATIONAL CUSTOMERS IN THE HOTEL INDUSTRY IN NAIROBI, KENYA CLARE WAMALWA A research project SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE AWARD OF A DEGREE OF MASTER OF BUSINESS ADMINISTRATION, School of Business, UNIVERSITY OF NAIROBI NOVEMBER, 2014
DECLARATION I hereby declare that this Research Report is my own original work and has never been presented by anybody for the award of any degree. Signed:..................................................................Date:..................... ... Name: Clare Nekesa Wamalwa Reg. No: D61/63824/2011 Approval This Research Report has been submitted for examination with my approval as a university Supervisor. Signed:....................................................................Date..................... ... Dr. Justus Munyoki Snr. Lecturer University of Nairobi II
DEDICATION This work is dedicated to my family for your overwhelming support and encouragement all the way and to my beloved parents Dr. Andrew Wamalwa and Mrs Leonorah Wamalwa, thank you for your support, prayers, love and resilience. God bless you all! III
ACKNOWLEDGEMENTS My gratitude goes to God for giving me the strength and ability to undertake my MBA course. I am indebted to my supervisor Dr. Justus Munyoki as well as moderator Dr Raymond Musyoka for their insight, time, encouragement as well as support right from the time of inception up to the final submission of the project. Gratitude to my MBA colleagues with whom I interracted with, my colleagues at work and friends who supported me as well. IV
ABSTRACT The study sought to establish marketing strategies adopted by hotels in nairobi county as well as their attraction of international customers. The study objective was to establish the marketing strategies adopted by hotels in Nairobi County and their influence on performance of International customers. The study adopted descriptive research design targeting 52 hotels in Nairobi County where each hotel received 1 questionnaire. The respondents were Marketing managers or the equivalent. Primary data was collected using questionnaires as well as secondary data from articles in regards to performance of the hotels. The data collected was presented in form of frequency tables as a representation of the results. Findings from the study indicate that marketing strategy practices namely Broadcast communication, Social Media, Billboards, Verbal and Print have an effect on the attraction of international customers to hotels in Nairobi although in variation. All the hotels strive to make their services be of good quality and known by their target market. This study has established that social media is widely used by hotels to market their services to international customers and therefore affect their performance. Firms need to continously adopt frameworks that creatively churn out endless practises inorder to remain competitive. In addition, they have to find out which platforms their target population access in order to market their services accordingly. V
Table of Contents DECLARATION...............................................................................ii DEDICATION..................................................................................iii ACKNOWLEDGEMENT....................................................................iv ABSTRACT.....................................................................................v LIST OF TABLES...............................................................................ix CHAPTER ONE: INTRODUCTION......................................................1 1.1 Background to the study...... .........................................................1 1.1.1 Strategic Marketing..................................................................2 1.1.2 Orgnization Performance...........................................................3 1.1.3 The Hotel Industry in Kenya......................................................4 1.2 Research Problem ...........................................................................6 1.3 Research Objectives .......................................................................7 1.4 Value of the Study .........................................................................7 CHAPTER TWO: LITERATURE REVIEW............................................9 2.1 Introduction ..............................................................................9 2.2 Theoretical Foundation .................................................................9 2.2.1 Marketing Mix Theory.......................................................9 2.2.2 Service Marketing Theory................................................11 2.3 Marketing Strategies & Performance ...............................................12 2.3.1 Product Strategy ..........................................................13 2.3.2 Price Strategy..............................................................14 2.3.3 Place Strategy ..............................................................14 2.3.4 Promotion Strategy .......................................................15 VI
2.4 Destination Marketing .................................................................16 CHAPTER THREE: research methodOLOGY...............................18 3.1 Introduction.................................................................................18 3.2 Research Design...........................................................................18 3.3 Population of the Study...................................................................18 3.4 data collection.............................................................................19 3.5 Data Analysis...............................................................................19 CHAPTER FOUR: DATA ANALYSIS AND INTERPRETATION.............20 4.1 Introduction.................................................................................20 4.2 Bio Data......................................................................................20 4.2.1 Hotel classification..................................................................21 4.3 Marketing strategies adopted by hotels..................................................22 4.3.1 Most effective form of Communication...........................................22 4.3.2 Promotional offers by hotels.......................................................23 4.4 Services offered by hotels.................................................................24 4.4.1 Services hotels are well identified of.............................................25 4.5 Attraction of international customers....................................................25 4.5.1 Hotel Occupancy.....................................................................26 4.5.2 Services requested mostly by international customers..........................26 4.5.3 Services hotels prefer requested....................................................27 4.6 Organization performance.................................................................28 4.6.1 Partnership of hotels with other tourism players...............................28 4.6.2 Services hotels prefer to be added.............................................. .28 VII
4.7 Discussion....................................................................................29
CHAPTER
FIVE:
SUMMARY,
CONCLUSION
AND
RECOMMENDATION.....................................................................31
5.1 Introduction.................................................................................31
5.2 Summary of Findings......................................................................31
5.3 Conclusion...................................................................................32
5.4 Limitations of the Study...................................................................32
5.5 Recommendations...........................................................................32
5.6 Areas of Future Research..................................................................33
REFERENCES................................................................................34
APPENDICES.................................................................................36
APPENDIX 1 Introduction Letter.........................................................36
APPENDIX 2 Questionnaire................................................................37
APPENDIX 3 Hotels in Nairobi County.................................................46
VIII
LIST OF TABLES Table 3.4 Sample Population..................................................................19 Table 4.1 Bio data of Hotels...................................................................20 Table 4.2 Classification of Hotels............................................................21 Table 4.3 Hotel Existence in the Market.....................................................21 Table 4.4 Marketing Strategies adopted by hotels.........................................22 Table 4.5 Promotion offers by Hotels.......................................................24 Table 4.6 Services offered by Hotels........................................................24 Table 4.7 Services hotels are identified of...................................................25 Table 4.8 Occupancy level by international customers....................................26 Table 4.9 Services demanded mostly by international customers.......................27 Table 4.10 Services hotels prefer requested.................................................27 Table 4.11 Organization Performance......................................................28 Table 4.12 Services hotels want to add......................................................29 IX
CHAPTER ONE: INTRODUCTION 1.1Background to the Study All organisations whether private or public require strategic marketing activities so as to remain relevant in their respective industries and to stand out from their competitiors. Wensley (1983) defines strategic marketing as an organization's strategy that combines all of its marketing goals into one comprehensive plan. He adds that a good strategy should be drawn from market research and focus on the right product mix in order to achieve the maximum profit potential and sustain the business. Ferrell (2008) states that an organization's strategic marketing describes how the firm will fulfil the needs and wants of its customers. It can also include activities associated with maintaining relationships with other stakeholders such as employees or supply chain partners. Stated in another way, strategic marketing is a plan for how the organisation will use its strengths and capabilities to match the needs and requirements of the market. A marketing strategy can be composed of one or more marketing programs. Each program consists of two elements; target market (s) and marketing mix. Competitiveness is an important factor to consider for an organisation to perform well. It is defined as the ability of companies, industries, regions, nations, and supranational regions to generate, while being and remaining exposed to international competition, relatively high factor income, and factor Employment Levels on a sustainable basis (Gulati, 1999). A firm's sustainable competitiveness derives from its ability to assemble and exploit an appropriate combination of resources. It is achieved by continuously developing existing and creating new resources and capabilities in response to dynamic market conditions (Barney, 2007). Also, a firm's competitiveness is influenced by being strategic. Ferrell (2008) explains that a firm must select the right combination of target market (s) and marketing mix (es) in order to create distinct competitive advantages over its rivals. Attraction of international customers to the hotels in Kenya is determined by factors such as costs, security and quality services. Hotels in Nairobi consider coming up with affordable packages that would encourage international customers to seek services in hotels in Nairobi. The current security state in Kenya is wanting due to the 1
grenade attacks experienced recently and therefore, threatens tourists from other countries to come to Kenya. Due to this, hotels in Nairobi have improved their security checks to ensure safety for customers. We have also had travel advisories being put across early this year that led to travel cancellation of most of the tourists from other countries. Lilian (2014) reported that a tourist from England explained how disappointed he was to be told that he should be evacuated yet he was to relax after working and saving for the holiday. 1.1.1 Strategic Marketing The marketing concept emerged in the 1950's as a customer centred, sense and respond philosophy. The job is to find not the right customers for your products but the right products for your customers. Jerome (1991) explains that strategic marketing specifies a target market and a related marketing mix and that two interrelated parts are needed namely: target market which is a fairly homogenous group of customers to whom a company wishes to appeal and Marketing mix which is the controllable variables the company puts together to satisfy this target group. He adds that strategic marketing specifies some particular target consumers. He calls this approach Target marketing. Kotler (2003) emphasizes that to succeed in today's competitive market place, companies need to be customer centred. They must win customers from competitors, then keep and grow them by delivering greater value. But before satisfying consumers companies must first understand their needs and wants. Thus sound marketing requires a careful customer analysis. He defines marketing strategy as the marketing logic by which the company hopes to create this customer value and achieve these profitable relationships. The company decides which customers it will serve (segmentation & targeting) and how (differentiation & positioning). It identifies the total market then divides it into smaller segments, selects the most promising segments and focuses on serving and satisfying the customers in these segments. The goal of strategic marketing is to stand out and be noticed. Good marketing keeps drawing customer's attention to products and services. Clearly defined, wellpackaged, competitively- priced products and services are the foundation of marketing. The newer a company is in the market the harder it has to work to attract 2
and retain new customers. One should consider which promotional activities best meet marketing needs. Companies have a unique strategy when they have defined a clear target market and need, developed a distinctive and winning value proposition for that market and when they have arranged a distinctive supply network to deliver the value proposition to the target market. 1.1.2 Organizational Performance Jerome (1991) argues that the task of any business is to deliver customer value at a profit. In a hypercompetitive economy with increasingly informed buyers faced with abundant choices, a company can win only by fine tuning the value delivery process and choosing, providing and communicating superior value. He also says that, to be successful, a firm also needs to look for competitive advantages beyond its own operations, into the value chains of suppliers, distributors and customers. Rajendra (1998) therefore defines organisational performance as the actual output or results of an organization as measured against its intended output, goals and objectives. Kotler (2003) explains that a firm's success depends not only on how well each department performs its work but also on how well the various departments coordinate their activities. It is advisable for firms to learn what customers need and provide them with desired products and services at unbeatable low prices. Kotler emphasises that a company's value chain is only as strong as its weakest link and that Success depends on how well each department performs its work of adding customer value and on how well the activities of various departments are coordinated. And therefore, a company's different functions should work in harmony to produce value for customers. He also describes market segmentation and targeting as well as differentiation and positioning as very important marketing activities to be undertaken in order to enhance organization performance. When an organization knows how effective to segment, target, differentiate and position it will be convenient for firms to know the right promotional activities to be undertaken. Product and service promotion is the most common form of strategic marketing and they include: Advertising, personal selling or telemarketing, publicity, short-term sales promotion, direct marketing among others. These methods can be used as a combination to the target customers. The right marketing mix will help satisfy customers' needs, increase 3
sales, improve results and increase ability to reach multiple customers within the target market and therefore improve organisation performance. Nelson (2008) describes performance as an important organizational behaviour directly related to the production of goods or delivery of services. He says performance is most often thought as task accomplishment. He further explains that performance must be clearly defined and understood by the employees who are expected to perform well at work. Each specific job in an organisation requires the definition of skills and behaviours essential to excellent performance. Performance is measured using financial as well as non- financial indicators. Financial indicators include the profits that an organization makes and non- financial indicators include customer satisfaction, efficiency, effectiveness, consistency among others. According to Richard et al. (2009) organizational performance encompasses three specific areas of firm outcomes: financial performance (profits, return on assets, return on investment, etc.), product market performance (sales, market share, etc.); and shareholder return (total shareholder return and Economic Value added. Hotels in Nairobi ensure they perform well by offering quality customer service by checking on customers every time to find out whether they are ok. They also ensure hygiene in the hotel rooms, restaurants and the food they service their customers. In order to make customers become loyal to them, they make these services consistent to all the customers and they keep improving them in areas where they find customers complaining about. Rhodes (2012) explains performance management as the process of creating a work environment or setting in which people are enabled to perform to the best of their abilities and that it is a whole work system that begins when a job is defined as needed. It ends when an employee leaves an organization. Performance management involves setting targets, constantly reviewing progress towards those targets and taking remedial action where there are training or development shortfalls. 1.1.3 The Hotel Industry in Kenya The hospitality industry in Kenya is very competitive due to the tourist attractions. Tourism and hospitality is Kenya's second most important industry and the leading foreign exchange earner. Kenya and in particular Nairobi remains the commercial hub 4
of East Africa. Domestic tourism has become a significant form of tourism in Kenya where it is found that it can cushion off the industry during low periods of international tourist arrivals. The performance of hospitality industry is determined by the season as well as factors such as availability of the number of charter flights from other countries to Kenya and political state. Mathias (2013) reported that charter flights from Europe had dropped to less that 10 per week compared to 17 to 20 in the same period in 2012. This affected hotel occupancy. Still in the same article, it was reported that Bed Occupancy in Mombasa was down to 50% from 70% in the same period in 2012. Hotels in Malindi and Watamu had less than 40% occupancy, while in the south coast are below 30%. As a result of this, tourism sector was under increasing pressure to look for new sources of visitors as numbers from the traditional markets continued to decrease. Statistics for the 2012/2013 tourism performance released on September 2013 showed an overall drop in numbers by nine per cent to 1.2 million from 1.3 million in 2012. Earnings from the sector, that contributes 11 per cent to the GDP, reduced by seven per cent to Sh96 billion, down from Sh104 billion in 2012. Despite fears of political instability following the March 2013 elections, there was a marked increase in investment by global players in hotels within the country, due to the growth in inbound business and conference tourism particularly within the capital. Several developments are already underway, with key global brands such as Radisson Blu, Lonrho Hotels, Safari park hotel and Best Western already set to open for business not too far into the forecast period. Existing players, such as Hilton and InterContinental, are, meanwhile, looking to entrench their presence within the country in order to protect their market shares in the face of the growing competition. The increase in international brands within the region is setting the country up as a regional hub for business and conference tourism, with recognisable brands which make it an ideal destination for tourists looking to stay with brands they trust. Most hotels in Nairobi have their own unique selling proposition that distinguish them from their competitors. For instance Intercontinental Nairobi has positioned itself as a business hotel due to its proximity in the Central Business District, and it's adjacent to parliament and highway making it easy for delegates for attend their meetings. The Intercontinental Nairobi hold campaigns for different seasons to encourage domestic 5
tourism. For instance, they are currently carrying out a social media campaign for Easter where their packages were family oriented to encourage people to stay in Nairobi for the Easter vacation. Safari park hotel is well known of its safari cat dancers and it is well situated in a peaceful environment in the outcasts of the busy Nairobi city. Most companies hold their press conferences and events in hotels around the Central Business District due to proximity of the press and guests. However, last year safari park was highly preferred by many companies to host International Conferences due to the Westgate attack which made people prefer hotels that are away from town. 1.2Research Problem According to a survey done on market orientation and Business performance in the hotel industry by Sahilyolu (1999), Hotels like any other business exist to make profit and in order to make this they have to continuously create value for their customers. The changes in the industry and macro environment offers opportunities and threats for the hotels. Therefore in this rapidly changing business environment today, hotels have to continuously generate intelligence about the current and future customer needs and wants, disseminate this information to all departments and respond to changes promptly. He adds that In short, they have to be market oriented, so this will result in satisfied loyal customer, repeat business and consequently positive business performance. All hotels, including 3 star, 4 star or 5star fit in different competitive environment in the hospitality industry as they target different market niche. Marketing strategies outline outright framework for them to thrive. Several studies have been done in the area of strategies and tourism however, these studies tend to target different sectors. For instance, Lawton (1980) carried out a survey on the impact of marketing strategies on new product planning where he examined the impact of adoption of marketing concepts on new products. This study did not touch on tourism matters. On the other hand, Achieng (2008) did a Case Study of Nairobi city analysing the factors inhibiting the growth of domestic tourism and the level of awareness about domestic tourism among middle level income employees in Kenya. She also 6
investigated the link between the lack of a holiday culture, the tourism sector attitude towards the domestic tourist and the low level of domestic tourism amongst middle level income employees in Kenya. This study does not capture the use of strategic marketing on the level of awareness about domestic tourism. Mungai (2003) studied the digital revolution in Kenya where an analysis of the role of information communication technologies on market access to the tourism and air travel sub-sector in Kenya was carried out. The study also provided an inter-county comparison in ICT penetration between Kenya and its trade competitors in the tourism industry. This study did not focus on the marketing strategies in the hospitality industry as well. Finally, Muriithi (2013) carried out a research on influence of strategic marketing on the performance of Telecommunication companies in Nairobi. This research focused specifically on telecommunication companies and how strategic marketing affect their performances and did not touch on tourism aspects. The above studies outline a gap in the hospitality industry which has not given empirical studies addressing strategic marketing practises in Nairobi in regards to tourism performance in the hotel industry. It would be vital to conduct a study to establish strategic marketing practices as well as their extent to influence the performance of international customers in the hotel industry in Nairobi. Based on the above background, the study shall undertake to answer the question: What Is the influence of strategic marketing activities on the performance of international customers in hotels in Nairobi County? 1.3Research Objectives To establish the marketing strategies adopted by hotels in Nairobi county and their influence on performance of International customers. 1.4Value of the Study The study will be of importance to international tourists, brand managers and academicians. Tourists will be able to evaluate the different strategies in terms of marketing practices on how they meet their expectations as well as influence the 7
choice of their service provider. Brand managers will have a deeper insight into Nairobi county dynamics thus a basis to come up with effective marketing campaigns. Academicians and other researchers will have visibility on strategic marketing practices as well as its effects on performance. This study is likely to generate gaps of knowledge that can be used by other researchers to explore more in this area. 8
CHAPTER TWO: LITERATURE REVIEW 2.1 Introduction This section reviews various theoretical foundations as well as literature and Empirical strategic marketing practices. 2.2 Theoretical foundation There are various theories in Marketing. However, only two are applicable to the influence of marketing strategies on tourism performance in the hotel industry in Nairobi. This include Marketing mix Theory and Service marketing Theory. 2.2.1 Marketing Mix Theory Marketing is a continually evolving discipline and as such can be one that companies find themselves left very much behind the competition if they stand still for too long. One example of this evolution has been the fundamental changes to the basic Marketing mix. Where once there were 4 P's to explain the mix, nowadays it is more commonly accepted that a more developed 7 P's adds a much needed additional layer of depth to the Marketing Mix with some theorists even going further. McCarthy (1960) explains Marketing Mix as a tool used by businesses and Marketers to help determine a product or brands offering. He reduced the marketing mix into four elements namely product, price, place and promotion. In the late 70's it was widely acknowledged by Marketers that the Marketing Mix should be updated. This led to the creation of the Extended Marketing Mix by Booms & Bitner (1981) which added 3 new elements to the 4 P's Principle. This now allowed the extended Marketing Mix to include products that are services and not just physical things. They include, People, Processes and Physical evidence. Of all the aspects of the marketing mix, price is the one, which creates sales revenue all the others are costs. The price of an item is clearly an important determinant of the value of sales made. In theory, price is really determined by the discovery of what customers perceive is the value of the item on sale. Researching consumers' opinions about pricing is important as it indicates how they value what they are looking for as 9
well as what they want to pay. An organisation's pricing policy will vary according to time and circumstances Price Theory is concerned not with economic problems in the abstract, but with how a particular society solves its economic problems. Philip (1776) describes that It is also concerned with explaining economic activity in terms of the creation and transfer of value, which includes the trade of goods and services between different economic agents. A puzzling question addresses by price theory is for example: why is water so cheap and diamonds are so expensive even though water is critical for survival and diamonds are not? Milton (2007) explains that in economics, the major division is between monetary theory and price theory. Monetary theory deals with the level of prices in general, with repeated and other fluctuations in total output, total employment, and the like. Price theory deals with the allocation of resources among different uses, the price of one item relative to another. Prices do three kinds of things. They transmit information, they provide an incentive to users of resources to be guided by this information, and they provide an incentive to owners of resources to follow this information. Milton Friedman's classic book provides the theoretical underpinning for and understanding of prices. Although figures vary widely from product to product, roughly a fifth of the cost of a product goes on getting it to the customer. 'Place' is concerned with various methods of transporting and storing goods, and then making them available for the customer. Getting the right product to the right place at the right time involves the distribution system. The choice of distribution method will depend on a variety of circumstances. It will be more convenient for some manufacturers to sell to wholesalers who then sell to retailers, while others will prefer to sell directly to retailers or customers. Promotion is the business of communicating with customers. It will provide information that will assist them in making a decision to purchase a product or service. The razzmatazz, pace and creativity of some promotional activities are almost alien to normal business activities. The cost associated with promotion or advertising goods and services often represents a sizeable proportion of the overall cost of producing an item. However, successful 10
promotion increases sales so that advertising and other costs are spread over a larger output. Though increased promotional activity is often a sign of a response to a problem such as competitive activity, it enables an organisation to develop and build up a succession of messages and can be extremely cost-effective. 2.2.2 Service Marketing Theory According to a case study by Christian (1982), service businesses that have direct contact with customers seem to be the last to adopt a customer-oriented marketing concept. He theorises over service marketing and how it stands at the same point as industrial marketing did ten years ago. He hypothesises that general theories or frameworks for service marketing development seems to have followed two different paths. One approach covers services offered by service companies, should be changed in a more product-like manner, enabling the application of existing marketing theories. He compares the second approach which is a notion that services are different compared to physical products, holding that marketing concepts and models have to be developed in a more service-like direction. Wensley (1983) argues that the discipline of marketing is constantly being reshaped by internal and external forces. Occasionally, the pressures for change have been so compelling as in the present period of excitement. The most obvious forces stem from developments from strategic management and planning. It is also advisable for firms to focus on consumer behaviour in order to strategize on how to meet consumers needs. Murray (1991) explains that though the marketing discipline has directed attention to the field of service marketing in recent years, much of the work in that area has centred on the development of conceptual models with an emphasis on managerial paradigms. He adds that less attention has been given to understanding the behaviour of the service consumer though efforts to examine consumer activity are net worthy and highlight the linkage between service consumer behaviour and management task. Jagdish (1995) argues that consumers engage in relational marketing behaviour due to personal influences, social influences and institutional influences. Consumers reduce their available choice and engage in relational market behaviour because they want to simplify their buying and consuming tasks, simplify information processing, reduce 11
perceived risks and maintain cognitive consistency and a state of psychological comfort. Jagdish adds that they also engage in relational market behaviour because of family and social norms, peer group pressures, government mandates, religious doctrines, employer influences and market policies. The willingness and ability of both consumers and marketers to engage in relational marketing will lead to greater marketing productivity, unless either consumers or marketers abuse the mutual interdependence and cooperation. Hauser (1984) explains that it is true that one must understand how managers behave in order to model market behaviour and that one must understand how the markets behave in order to advise managers. The difference is not in the comprehensiveness in the analyses but in the emphasis. 2.3 Marketing Strategies and Performance Kotler (2010) defines marketing strategies as the marketing logic by which the company hopes to create customer value and achieve profitable customer relationships. Wilson and Gilligan (2008) state that understanding the strategic situation in an organization is an essential starting point in developing a marketing strategy. Strategic marketing focuses on a business's intentions in a market, the means as well as timing in order to realize those intentions. It's also applicable to businesses within defined boundaries. However, they do change thus strategy at any one time is confined to actions pertaining a specific area of demand as well as competition. By assessing organizational capabilities, threats from environmental forces, competitors strengths and weaknesses as well as competitor needs to develop a marketing mix in which a competitive strategy is derived. The process undergoes planning, decision making as well as control. In addition, strategic marketing does the following: guides the a firm in its relationship with its immediate environment, affects internal structure as well processes and ultimately affects the firms performance. It has been developed in recent years according to Dickson (1997) and talks about strategic critical thinking that focuses on entrepreneurship inside and outside the organization, on the creation of opportunities by being proactive and innovativeness at very decision-making level as well as the having the premises to manage and shape their environments. All business strategies must be justified by the availability of a 12
viable market. When there is no viable market, even the best strategy will flop. In addition, the development of marketing strategies for each business should be realistically tied to the target market. Wilson et al (2008) advises that in practice of a marketing strategy, a firm has to choose between being a market leader strategy, a market follower strategy, a market challenger strategy and a market nicher strategy. In addition, gaining market share is vital for every firm thus they stated below findings: market share and profitability are strongly tied, a firms relative product service singly affects long run performance as well as most strategic marketing practices that affect return on investment contribute to the long term value. Markets, nature of rules as well as competition have changed thus forming bases for competitive advantage that incorporate marketing mix elements namely: product, price, promotion, place, people, physical evidence as well as process management. Kotler (2010) argues, to find the best marketing strategy and mix, the company engages in marketing analysis, planning, implementation and control. 2.3.1 Product Strategy Wilson et al (2008) explains that product strategies reflect the mission of the business unit and the business it is in. It entails placing a brand in that part of the market where it will have a favourable reception compared with competing brands. Its objectives include: to position the product in the market so that it stands apart from competing brands; to position the product so that it tells customers what you stand for, what you are, and how you would like customers to evaluate you. It also states that product strategies specify market needs that may be served by different product offerings. Clark and Fujimoto (1990) put across different product perspectives. Product repositioning strategy reviews the current positioning of the product and its marketing mix while seeking a new position for it that seems more appropriate. It aims at increasing life of the product as well as correcting original positioning mistake. At the end, there should be an increase in sales growth and profitability among existing customers. Among new users there is enlargement of the overall market, thus putting the product on a growth route, while increasing profitability. Development of new product uses increases sales, market share as well as profitability. 13
Hotels offer services. Every hotel has their own unique service that stands out from its competitors. Some are known of their entertainers, special cuisines, spas and many others. These are the unique services that attract customers depending on what their needs are. 2.3.2 Price Strategy Jerome (1991) defines price as the amount of money customers must pay to obtain a product or service. He adds that in setting a price, a company must consider the kind of competition in the market and the cost of whole marketing mix. A firm must also try to estimate customer reaction to possible prices. Besides this, they must know current practises as to mark ups, discounts and other terms of sale. Price must support the elements of the mix and must reflect supply and demand relationship. Pricing a product too high or too low could mean a loss of sales for the organisation. Pricing should take into account Fixed and variable costs, Competition, company objectives, proposed positioning strategies and target group and willingness to pay. Most of the pricing strategies that hotels in Nairobi use include: Bundle pricing where they bundle a group of services at a reduced price. For instance, packages for conferences where they put together room hire, PA system, dйcor, snacks, internet connection as a package depending on the number of people involved. Hotels also apply competition pricing. This involves setting a price in comparison with competitors. They either lower their prices, price the same or price higher. For example, meals in their restaurants, Business centre services such as printing, cyber cafй, photocopying etc. Hotels also apply this strategy during peak and low season. They lower accommodation prices during low season and rise them during peak season in order to attract tourists and to maintain their profits. Cost based pricing is also practised where hotels take into account the cost of production then they decide on a mark-up which they would like for profit to come to their final pricing decision. This apply mostly on food and drinks as well as the quality services being offered in accommodation. 2.3.3 Place Strategy Kotler (2010) defines place as company activities that make the product available to target consumers. It plays a fundamental role in the marketing mix of a service. The 14
place strategy outlines the how and where a company will place its products and services in an attempt to gain market share and consumer purchases. This component of the 4ps is sometimes referred to as the distribution strategy and may include the stores, both physical and online and any other means by which the company can reach customers. Jerome (1991) argues that place is concerned with getting the "right" product to the target market's place. A product is not much good to a customer if it is not available when and where it is wanted. A product reaches customers through a channel of distribution. A channel of distribution is any series of firms or individuals who participate in the flow of goods and services from producer to final user or consumer. It is advisable for an organization to devise ways of reaching its target market easily and for customers to reach them without struggle. Hotels in Nairobi have an online booking system where you can be able to reserve a hotel room or a conference room from wherever you will be. The situation of the hotels from business companies and airport is also vital. There are quite a number of hotels in the Central Business District, Upper hill and westlands where there are many businesses situated thereby making it convenient for them to secure their services. Some hotels are situated near the airport thereby convenient for tourists enabling them not to stay on traffic for long hours. 2.3.4 Promotion Strategy Promotion strategies are concerned with the planning, implementation, and control of persuasive communication with customers. These strategies may be designed around advertising, personal selling, sales promotion, or any combination of these. Kotler et al (2006) advices of clear-cut objectives and a sharp focus on target customers are necessary for an effective promotional program. An integrated communication plan consisting of various promotion methods should be designed to ensure that customers in a product/market cluster get the right message and maintain a long-term cordial relationship with the company. Promotional perspectives must also be properly matched with product, price, and distribution perspectives. Strategies for development of promotional strategies include promotional expenditure strategy. Practitioners have developed rules of thumb for determining promotion expenditures that are 15
strategically sound: either take the form of a breakdown method or they employ the buildup method. Another approach regards marketing mix factor; the promotion decision should be made in the context of other aspects of the marketing mix, Porter (1976). The price and quality of a product relative to competition affect the nature of its promotional perspectives. Higher prices must be justified to the consumer by actual or presumed product Superiority. Thus, in the case of a product that is priced substantially higher than competing goods, advertising achieves significance in communicating and establishing the product's superior quality in the minds of customers. An empirical study on this topic has shown that consumers prefer incentives other than price. Price cuts also appear to have little lasting effect on sales volumes. Gibson (1991) talks of advertising strategies being concerned with communication transmitted through the mass media. Promotional mix strategy involves determination of a judicious mix of different types of promotion. Its objective is to adequately blend the three types of promotion to complement each other for a balanced promotional perspective. Media selection strategy entails choosing the channels (newspapers, magazines, television, radio, outdoor advertising, transit advertising, and direct mail) through which messages concerning a product/service are transmitted to the targets. Its objective is to move customers from unawareness of a product/service, to awareness, to comprehension, to conviction, to the buying action. Advertising copy strategy designs the content of an advertisement with an objective of transmitting a particular product/service message to a particular target. Selling strategy entails moving customers to the purchase phase of the decision-making process through the use of face-to-face contact. Its objective entails achievement of stated sales volume and gross margin targets and the fulfilment of specific activities. Sales motivation as well as supervision strategy entails achieving superior sales force performance with an objective of ensuring optimal performance of the sales force. At the end business objectives are met adequately at minimum expense. 2.4 Destination Marketing John (2002) says that Destination Marketing strategies have long been influenced by traditional distribution processes and passive customers. But now, things have 16
changed with the customer taking over the process and rendering the previously normal processes redundant. Milner (2007) explains that it is hardly surprising that destination marketers tend to start with the product rather than the target markets. After all, unlike marketers in other sectors, they do not own or control the product, and it is often difficult ­ though not impossible ­ to influence it. She adds that at the most fundamental level, it is not possible to change whether the destination is urban or rural, historic or modern or has beautiful rolling countryside, or dramatic coastline. Milner (2007) suggests the tried and tested approach as: Starting with the product, getting to know it as well as possible, think about the product long and hard, to understand it, its history and character. Then, understand who is currently visiting and why? Decide who else it might appeal to and who to attract, then plan how to reach them. John (2002) also advises that it would be best if Destination marketing gets away from promoting the destination to a mass market and relying on outdated distribution system and instead engage the customer to ensure they effectively promote and provide the experience they are wanting. Tourism destination marketing involves many stakeholders and a complex product offer. Complexity and interdependency among stakeholders have resulted in the creation of many local tourism marketing alliances. The nature of their environment influences the domain over which they have authority. 17
CHAPTER THREE: RESEARCH METHODOLOGY 3.1 Introduction This chapter deals with Research design, Population sample, Measurement strategies and Procedures that will be used in the study. 3.2 Research Design The study adopted descriptive research design which Gay (1981) explains it as research methods used when the researcher wants to describe specific behavior as it occurs in the environment. They are concerned with finding out who, what, where, when, and how much. They try to measure the types of activities, how often, when, where and by whom. According to Gill & Johnson (2006), descriptive surveys are interested in addressing specific characteristics of a selected population of subjects at a point in time, or at varying times for the purpose of comparing the relationship between variables. Gay (1981) gives a variety of descriptive research methods available which are: Observation method which involves well observing, Case studies: making detailed observations about one specific case and Surveys. 3.3 Population of the Study The target population for this study was 3star, 4 star and 5 star hotels in Nairobi as well as tourism bodies. According to Kenya Association of Hotel Keepers & Caterers Kenya Hotel & Restaurant Guide (2014), there are approximately 52 hotels in Nairobi. This is a combination of 3Star, 4Star and 5 Star hotels. 18
Table 3.1: Sample Population
Population Subcategories 3 Star Hotels 4 Star Hotels 5 Star Hotels TOTAL
total population 28 12 12 52
% 53.9 % 23.05 % 23.05 % 100
3.4 Data Collection The study collected both primary as well as secondary data. Primary data collection method, questionnaire which will included both open ended questions in which respondents gave their views as well as closed ended questions in which respondents were limited in their responses. While administering the questionnaires, the researcher distributed them to all the hotels with each receiving 1 questionnaire. The respondents were Marketing and communications managers or their equivalent. Respondents filled the questionnaires and were picked the same day. Secondary data was sourced from published reports. 3.5 Data Analysis Data collected from the field was rearranged, serialized, coded and analyzed by the use of SPSS software. Data analysis refers to extraction of meaningful information from a mass of data. Analysis will be done using descriptive statistics which involves Measures of central tendency such as Mean, and Measures of dispersion such as Standard deviation. The analyzed data was presented in the form of frequency tables and graphs.
19
CHAPTER FOUR: DATA ANALYSIS AND INTERPRETATION 4.1 Introduction This chapter presents the results of the data findings. The objective of the research project was to determine the influence of marketing strategies on attraction of international customers in the hotel industry in Nairobi County. The research targeted 3 star, 4 star and 5 star hotels in Nairobi County. In data collection, questionnaire was used as the main instrument to sample 52 hotels where the respondents were the marketing managers, Marketing executives or the equivalent. Out of 52 hotels, only 20 accepted to participate in filling out questionnaires and 32 were not able to fill in the questionnaires. 4.2 Bio Data This section presents the results of the profile of the hotels. The hotels are based in Nairobi county targeting one respondent per hotel. The respondents comprised of Marketing executives, Marketing managers and Marketing directors. This grouping enabled the researcher to collect effectively as well as have an affirmative analysis of data about the influence of marketing strategies as well as the performance of the hotels. The results are shown in Table 4.1. Table 4.1: Bio data of Hotels
Frequency
Marketing Executive 8
Marketing Manager 11
Marketing Director 1
Total
20
Source: Research Data 2014
Percent 40.0 55.0 5.0 100.0
20
4.2.1 Hotel Classification Table 4.2 shows the classification of hotels the respondents participated in filling in questionnaires.
Table 4.2 Classification of Hotels Frequency
3 Star
6
4 Star
5
5 Star
9
TOTAL
20
Source: Research Data 2014
Percent 30.0 25.0 45.0 100.0
From Table 4.2, 30% were 3 star hotels, 25% were 4 star hotels and 45 % were 5 star hotels. 55% of the respondents were Marketing managers of these hotels, 44 % were Marketing executives and 1% was marketing director.
Table 4.3 : Hotel existence in the market
Frequency
1-5 Years
3
6-10 Years
13
11-15 Years
2
16-20 Years
2
Total
20
Source: Research Data 2014
Percent 15.0 65.0 10.0 10.0 100.0
21
Table 4.3 shows the number of years the hotels have been in existence in the market. This also portrays how much experience they have in the tourism industry.
In the table, 15 % of hotels in Nairobi have been in existence for 1-5 years, 65 % have existed for 6-10 years, 10% have been in existence for 11-15 years and 10% have been in existence between 16-20 years.
4.3 Marketing Strategies adopted by Hotels
The hotels were asked to answer questions in regards to the marketing strategies they highly adopt. The marketing strategies were: Radio and Television, Social Media, Billboards, Verbal Communication, print media, Promotions, Website design. The table below shows that a big percentage of hotels preferred to use social media as their marketing tool, followed by Print media, Radio and Television, Verbal communication then Billboards.
Table: 4.4 Marketing Strategies adopted by Hotels
Frequency
Radio and Television
3
Social Media
9
Billboard
1
Face to Face
2
Print
5
Total
20
Source: Research Data 2014
Percent 15.0 45.0 5.0 10.0 25.0 100
As shown in Table 4.4, 15% of hotels in Nairobi use Radio and Television to market their services, 45% of hotels use social media as a marketing tool. 5% use Billboards, 10% use verbal communication and 25% use newspapers and magazines. 4.3.1 Most Effective Form of Communication As per hotels in Nairobi, the most effective marketing strategies used is social media since most of their target market access online platforms more than the traditional communication methods. 15 % of the hotels prefer radio and Television. These were
22
mostly 5 star and some 4 star hotels. 5% say billboards are the most effective, 10% say verbal communication and 25 % prefer print. From the findings, hotels do market research to find out which platforms are accessed by their target market. Based on the market research, a comprehensive marketing campaign plan is drawn. Since a big percentage of 5 Star hotels target international customers, they found out that social media is the most effective form of communication since they are always online doing business communication, online bookings, checking which hotels they will stay, communicating with their friends and family. It also transmit messages faster and reaches a wider audience worldwide compared to other forms of communication. Radio and Television are also effective if used in a targeted approach. For instance being very specific on timing and the channels that the target audience reach. This form of communication is a bit pricy and it's confined to a particular region where the stations reach. Billboards are also confined to a specific areas where the target market is located. Verbal communication was also found to be a very impactful mode of communication as customers tend to trust what their friends say about a particular service. 4.3.2 Promotional offers Hotels in Nairobi County give out promotional offers that suit different seasons for instance, Accommodation discounts, Holiday packages, Lunch coupons, Conferencing discounts, Happy hour and Family packages. Table 4.5 shows the promotional offers that hotels give their customers in order to drive traffic to their services. 23
Table 4.5: Promotional offers by Hotels
Accommodation discounts Holiday Packages Lunch Coupons Conferencing Discounts All Total
Frequency 3 4 5 1 7 20
Percent 15.0 20.0 25.0 5.0 35.0 100.0
Source: Research Data 2014
Table 4.5 shows the percentage of promotional offers issued by Hotels in Nairobi. 15% offer accommodation discounts, 20% offer Holiday packages, 25% offer Lunch coupons, 5% offer Conferencing discounts and 35% offer all the promotional discounts.
4.4 Services offered by Hotels
The services offered by hotels include: Banqueting and conferences, Accommodation, Meals, Team Building and outside catering. Most of the hotels are still looking at adding more services some are not due to factors like lack of enough space, some are content by the services they offer and are working towards improving them more and some feel they are the best in the market. Table 4.6 outlines the services offered mostly by Hotels in Nairobi.
Table 4.6: Services offered by hotels
Frequency
Banqueting and Conferencing 4
Accommodation
9
All
7
Total
20
Percent 20.0 45.0 35.0 100.0
Source: Research Data 2014
24
From Table 4.6, 20% of hotels mostly offer Banqueting and conferencing services, 45% offer Accommodation and 35 % offer all the above services. A big percentage of local customers seek either Banqueting or conferencing for the corporate/ business events. The primary need for international customers is accommodation. Other additional needs such as banqueting and conferences and meals are dependent on the purpose of the customer's visit.
4.4.1 Services Hotels are well identified of
Every hotel has the service that identifies them. The service that they are best at offering. Some hotels believe that they are identified by all the services they offer as they see themselves as being the best in the market. Table 4.7 shows the services hotels are well identified of.
Table 4.7: Services Hotels are well identified of
Banqueting and Conferencing Accommodation All Total
Frequency 4 9 7 20
Percent 20.0 45.0 35.0 100.0
Source: Research Data 2014
As indicated in Table 4.7, 20% of hotels in Nairobi County are identified of their quality Banqueting and Conferencing services. 45% of them are identified of Accommodation services and 35 % are well identified of offering all the services in good quality.
4.5 Attraction of international customers
This section outlines the percentage of attractiveness of international customers although some hotels target local customers exclusively. A big percentage of hotels in Nairobi target both Local and international customers although some hotels target only local customers. According to the research, 30% of hotels in Nairobi target local people and are highly attracted by them while 70 % of the hotels target both Local and International customers.
25
4.5.1 Hotel Occupancy Level
The occupancy level in Hotels in Nairobi is dependent on different factors such as season, Price, Quality of services offered and Customer service. But most of the respondents argued out that occupancy level is dependent on affordability and therefore prices should be reduced to make the services more demanded.
Table 4.8: Occupancy Level by International customers
Frequency
Yes
4
No
15
Low seasons require price 1
reduction
Total
20
Source: Research Data 2014
Percent 20.0 75.0 5.0 100.0
As indicated in Table 4.8, 20% of the hotels prices should be reduced for occupancy level to increase, 75% said there is no need of reducing the prices of services and what matters is the value a customer gets from the money they paid and what hotels should work on is to improve on the services they are offering. 5% of the hotels said that prices should be reduced during low seasons in order to increase occupancy level in the hotels.
4.5.2 Services requested Mostly by International customers The respondents were asked to indicate the services that international customers seek mostly while they visit Kenya. The results are shown in table 4.9 below.
26
Table 4.9: Services demanded mostly by international customers
Banqueting and Conferencing Accommodation
Frequency 6 11
Percent 30.0 55.0
Meals
2
All
1
Total
20
Source: Research Data 2014
10.0 5.0 100.0
As shown in Table 4.9, 55% of hotels are demanded accommodation services, 30% are mostly requested for Banqueting and conferencing, 10% for meals and 5% for all the services offered. This varies according to location of the hotel, the core business, target market, pricing and quality of the services offered.
4.5.3 Services hotel prefer requested
The respondents were asked to indicate the services they would prefer requested mostly by their customers. The results are shown in table 4.10.
Table 4.10: Services Hotels prefer requested
Banqueting and Conferencing Accommodation
Frequency 6 11
Percent 30.0 55.0
Meals
2
All
1
Total
20
Source: Research Data 2014
10.0 5.0 100.0
As shown in Table 4.10, 30% of hotels in Nairobi are working towards making Banqueting and Conferencing services demanded heavily by their customers through strategic marketing activities. 55% want Accommodation services to be highly 27
demanded, 10% are looking at meals and 5% of the hotels want all the services to be highly demanded.
4.6 Organization Performance
The respondents were requested to rate the services they offer. The results are shown in table 4.11. This was based on the services they offer, the Pricing, customer service, and how they work as teams.
Table 4.11: Organization Performance
Satisfactory Good
Frequency 6 8
Percent 30.0 40.0
The Best
6
Total
20
Source: Research Data 2014
30.0 100.0
Table 4.11 indicates that, 30% of hotels think their services are satisfactory, 40% feel their services are good and 30% rate their services as the best compared to the hotels they compete with. 4.6. 1 Partnership of hotels with other tourism players The respondents were also requested to indicate whether they hold partnerships with other tourism players for them to get an opportunity to market themselves to their target market. 65% of the hotels partner with other tourism players while 35% of the hotels do not do partnerships.
4.6.2 Services Hotels prefer to add The respondents were asked to indicate the services they prefer their hotels to add for them to attract more international customers than before. Some of the services they want to add are: parking space, roof top, Swimming pool, more meeting rooms and accommodation. The results are shown in Table 4.12. 28
Table 4.12: Services Hotels want to add
Frequency
No
16
Yes Parking space, Roof top, 1
Swimming Pool, More
meeting rooms, more
accomodation
Yes accommodation rooms 2
Yes Parking Space
1
Total
20
Source: Research Data 2014
Percent 80.0 5.0 10.0 5.0 100.0
As shown in Table 4.12, 80 % of the hotels prefer not to add any other service, 5% are looking at adding parking space, roof top, swimming pool, more meeting rooms and accommodation. 10% want to add more accommodation rooms and 5% parking space. 4.7 Discussion According to the research, Hotels in Nairobi have gone tech savvy and they have social media accounts that enable them to market their services worldwide to attract international customers from all over. The hotels that target only the local customers as well have presence online and are to a great advantage of reaching people all over the country. They have also identified that, using online platforms to market their services is cheaper compared to traditional way of marketing and therefore they do not have to spend a lot of money in their marketing strategies. Apart from marketing, Hotels are also working hard to ensure that their services are of good quality compared to the other competitors. They are also looking at adding more services that will be of great advantage to them to attract more customers. They are also having partnerships with other tourism players in the market who will give them mileage in making their brands known to the target market. In partnerships, 29
they are also participating in the local and international forums where they get an opportunity to market their services further. Pricing strategies are also applied by some of the hotels in Nairobi. Alpert (1971) says pricing objectives can be either profit oriented or volume oriented. Most of the hotels look at the profits they want to gain at the end of the day. Some prefer lowering prices during low seasons while others prefer to make the prices constant but to focus more on the quality of the services offered. 30
CHAPTER FIVE: SUMMARY, RECOMMENDATIONS
CONCLUSION
AND
5.1 Introduction
This chapter presents the summary of the study, conclusions based on the findings, as well as recommendations. The chapter attempts to answer the research question, covers the conclusion of the study, recommendations for further for further studies that might have cropped up from the study findings as well as limitations surfacing while conducting the study.
5.2 Summary of the Findings
The Hotel industry is very competitive as well as dynamic. It is therefore vital for players in the industry to continue to adapt marketing strategy practises in order for them to have a good performance. The study objective was to establish marketing strategies adopted by hotels in Nairobi County and their attraction of international customers. The study established that the marketing strategies adopted by hotels in Nairobi are: Radio and Television, Social media, Billboards, Verbal communication, Print media, Promotional offers, web design and online marketing. Majority of hotels use Social media as their preferred form of marketing followed by Print, Then TV and Radio, Billboards and lastly verbal communication. Also, hotels give out promotional offers to attract more customers to seek their services.
The most effective marketing strategy is Social media as majority of international customers spend most of their time on internet. The second most effective form of communication is Print, then TV and Radio, Billboards and verbal communication. Hotels are also having partnerships with other major tourism players so that they can have an opportunity to be seen by their target market. The services hotels offer are: Banqueting and conferencing, Accommodation, Meals, Team building and outside catering. Organisation performance is based on the acquisition of revenue generated by consumption of services hotels offer. Good customer service, quality and affordable services determine the occupancy of hotels by customers. Some hotels are also looking at adding more services on top of the list of the services they have and also improving the services that are already in existence in order to attract more customers and to retain the ones they have.
31
The tourism industry is one of the biggest foreign exchange earner in Kenya due to the many tourist attractions that our country has. More hotels are still coming up and therefore competition will continue to become intense thus vital for their continuous adoption of marketing strategies in order to have sustained performance. 5.3 Conclusion The study aimed at determining the marketing strategies adopted by Hotels in Nairobi. In addition, it aimed at finding out their Influence on attraction of International customers. The study established that marketing strategies are vital to every hotel's performance and that there was a direct relationship between their applications with performance in terms of revenue as well as customer base. Social media makes the hotels widely known all over the world and therefore improves the occupancy rate, Print advertisements makes hotels' services known locally and internationally depending on the circulation of the print materials, TV and Radio gives the real feel of the services offered by hotels and therefore are as well impactful, Promotional offers entice customers to seek services immediately, Verbal communication also spreads really fast and people tend to go to hotels that have been attended by somebody else. 5.4 Limitations of the Study The sample size was not good enough as most of the respondents did not respond well while some were hesitant to give their responses. Time as well as resources were a major limitation as the respondents needed to be reminded about the questionnaire by constantly calling them. This became expensive due to airtime needed to make the calls. One hotel refused to fill in the questionnaire since it's against their organisation policy. Some responses came late due to busy schedule of the respondents. Some gave biased answers while some were based on their perception hence dynamic findings. A number of responses were difficult to read as some had poor handwriting while others mixed up answers for different questions. 5.5 Recommendations The study has established that strategic marketing practises as adopted by hotels determine their performance. Its important therefore for firms in the industry to 32
continue to adopt frameworks that creatively churn out endless marketing practises in order to remain competitive. The study found out that research and development was not properly integrated with strategic marketing practises. Incredible offers that have not been bundled with strategic marketing practises ended up not giving the hotels a competitive edge thus little budge on overall performance. 5.6 Areas for Future Research The study focused on hotels in Nairobi county and therefore future research should focus on hotels in Kenya. Future research should also explore more on challenges faced by hotels in drawing the marketing strategies to be used. 33
REFERENCES Christian G. (1982), European Journal of Marketing, An Applied Service Marketing Theory, Vol 16, issue 7, MCBUP Ltd. Ferrell. O (2008), Marketing Strategy. Thompson south-western, USA Hauser R. (1984), Journal of Business, Energy Economics Vol 9, Issue 2, page 104114. Elsevier Ltd. Jagdish N. (1995), Journal of the Academy of Marketing Science, relationship marketing in consumer markets: Antecedents and Consequences Vol 23, No.4 Page 255-271. Reuters. Jarkko S. (2006), Annals of Tourism Research Traditions of Sustainability in Tourism Studies, Volume 33 Issue 4, Page 1121-1140. Elsevier Ltd. Jerome .E (1991), Essentials of Marketing. Von Hoffmann press, inc. USA J King (2002) Journal of Vacation Marketing Vol. 8No 2. WC Livingston John Tribe (1995) Annals of Tourism Research Vol. 22, Issue 3; University of Waterloo Ontario, Canada. KAHC (2014) Kenya Association of Hotels and Caterers Kenya Hotel & Restaurant Guide; Land & Marine Ltd, UK. Kim B. Clark and Takahiro Fujimoto (1990). The Power of Product Integrity. Harvard Business Review (November­December). Kotler P (2003), Performance measurement. John Wiley & Sons Hoboken, New Jersey 34
Kotler K. (2012), Marketing Management. PEARSON EDUCATION ltd. England Kotler P. (2010), Marketing for Hospitality & Tourism. Pearson Education, Inc. USA Laura Milner (2007) Journal of Travel research. Vol 48; Association for Consumer Research Murray B. (1991), A Test of Services Marketing Theory, Journal of Marketing, Volume 55, No 1 Page 10-15. American Marketing Association Milton Friedman. (2007), Price Theory. Aldine Transaction Nelson Q. (2008), Understanding Organizational Behaviour. Thompson higher education USA. Phillips, R. (1776) The Oxford Handbook of Pricing Management, Oxford University Press. PIL. H (2009), Penguin Dictionary of Marketing. Penguin group USA Rajendra K. (1998), Market-Based assets & Shareholder value: A framework for Analysis Journal of Marketing, Vol. 62. No. 1 Page 2-18. American Marketing Association. Richard M.S Wilson and Collin Gilligan (2008). Strategic Marketing Management, 2nd edition, planning, implementation and control. Butterworth Heinemann, 9 Wensley R. (1983), Marketing Theory with a strategic orientation, Journal of Marketing, Vol 47, No.4 page 79-89. American Marketing Association. 35
APPENDICES APPENDIX 1: INTRODUCTION LETTER Dear Respondent, REQUEST FOR RESEARCH DATA I am an MBA student from the University of Nairobi, School of Business. I am conducting a research exercise as part of my academic program on "Influence of Marketing Strategies on Attraction of international customers in the Hotel industry in Nairobi, Kenya. "I humbly request that you assist with any information that would help in achieving this goal. Your response will be treated with at most confidentiality and will be used for academic purpose only. Thank you Clare Nekesa Wamalwa 36
APPENDICES 2 QUESTIONAIRE PART A: Bio Data
1. What is your job title?
___________________________________________________
2. For how long have you been in the tourism industry?
1-3 years ( ) 3-6 years ( _____________________________
) 6-9 years ( ) others
3. What classification is your hotel?
3 Star ( ) 4 Star ( ) 5 Star ( )
4. For how long has your hotel been in existence in Kenya?
1-5 years ( ) 6-10 years ( ) 11-15 years ( ) 16-20 years ( )
PART B: Marketing Strategies Adopted
5. Which form of marketing communication do you mostly use?
Radio and television ( ) Social Media ( ) Billboard ( ) Face to Face ( ) Print media
6 . Which one is the most effective? Please be specific.
Radio and television ( ) Social Media ( ) Billboard ( ) Face to Face ( ) Print media
37
7. Is your hotel present on social media? Yes ( ) No ( )
If
no,
_______________________________________________________
why?
8. Which social media platforms does your hotel use?
Facebook ( ) Twitter ( ) Linked In ( ) Blogs ( )
9. What percentage has your brand increased the level of inquisitiveness in the market? 10-30% ( ) 31-60% ( ) 61-80% ( ) 81-100% ( )
Any ____________________________________________________________
other
10. To what extent does lack of marketing campaigns influence planned / unplanned purchases? 10-30% ( ) 31-60% ( ) 61-80% ( ) 81-100% ( )
Any
other
_______________________________________________________________
11. Do you think that these strategic service offers have any direct relationships with the Company's performance? Yes ( ) No ( ) Explain _____________________________________________________________
38
12. To what extent does branding increase the level of inquisitiveness in the market? Highly ( ) Moderate ( ) Low ( ) I don't know ( ) Explain ______________________________________________________________ 13. To what extent does lack of marketing campaigns influence planned / unplanned purchases? Highly ( ) Moderate ( ) Low ( ) I don't know ( ) Explain ______________________________________________________________ 14. Which service is mostly requested for at your hotel currently by your customers? Does it contribute to organizational performance? Yes ( ) No ( ) Explain ______________________________________________________________ 15. Do you think your communication strategies contribute to this service being highly sought out by customers? Yes ( ) No ( ) Explain ______________________________________________________________ 16. Which services would you like to be highly sought out by customers? And Why? 39
16.1 Banqueting and conferences ( ) 16.2 Accommodation ( ) 16.3 Meals ( ) 16.4 Team building ( ) 16.5 Outside catering ( ) Other ________________________________________________________________ 17. Would you recommend price reduction for the services you would like customers to seek more? Yes ( ) No ( ) Explain ______________________________________________________________ 18. What promotional offers does your hotel provide? 18.1 Accommodation discounts ( ) 18.2 Holiday packages ( ) 18.3 Lunch coupons ( ) 18.4 Conferencing discounts ( ) 18.5 Family packages ( ) 18.6 Happy hour ( ) Others _________________________ 19 To what extent does giving promotional offers to customers have an impact? Highly ( ) Moderate ( ) Low ( ) I don't know ( ) 40
Explain ______________________________________________________________ PART C: Organization Performance 20 What services does your hotel offer? 20.1 Banqueting and conferences ( ) 20.2 Accommodation ( ) 20.3 Meals ( ) 20.4 Team building ( ) 20.5 Outside catering ( ) 20.6 Other ___________________________________________________________ 21 Overall how would you rate your services? Satisfactory ( ) Good ( ) The best () 22 What is the basis of your rating above? Price ( ) Quality ( ) or both ( )? If any other answers kindly explain _____________________________________________________________________ _____________________________________________________________________ 23 Which service is your hotel well identified of? 23.1 Banqueting and conferences ( ) 23.2 Accommodation ( ) 23.3 Meals ( ) 23.4 Team building ( ) 41
23.5 Outside catering ( ) Other ________________________________________________________________ 24 Are you looking to add more services to the ones you already offer? Yes ( ) No ( ) If no, kindly explain _____________________________________________________________________ _____________________________________________________________________ If yes, which services are you looking to add? _____________________________________________________________________ _____________________________________________________________________ 25 If you could change any of your current services, what service could that be? ____________________________________________________________________ _____________________________________________________________________ 26 Thinking of similar products / services offered by other hotels, how would you compare the products / services offered by your hotel? _____________________________________________________________________ 42
PART D: Influence of Marketing Strategies on Tourism Performance 27 What has been your occupancy level in your hotel over the last one year? 10-30 % ( ) 40-60 % ( ) 70-90 %( ) 100 % ( ) 28 On average, what are the occupancy levels by the following cadres of guests ­ i). Local (Kenyan) 10-30 % ( ) 40-60 % ( ) 70-90 %( ) 100 % ( ) ii). Regional (from East African countries) 10-30 % ( ) 40-60 % ( ) 70-90 %( ) 100 % ( ) iii). International 10-30 % ( ) 40-60 % ( ) 70-90 %( ) 100 % ( ) 29 What kind of marketing activities does your hotel undertake? 29.1 Promotions ( ) 29.2 Social media ( ) 29.3 Website design ( ) 29.4 Print material (Business cards, flyers, brochures) ( ) 29.5 Email/ Direct marketing ( ) Other________________________________________________________ 30 Who do you target in these activities? 30.1 Local People (Kenyans) ( ) 30.2 Regional (East African Countries) ( ) 30.3 International ( ) 43
30.4 All ( ) 31 Have you participated in any local or international forum where you marketed your hotel? Kindly explain. _______________________________________________________________ ___________________________________________________________________ 32 How effective have these marketing activities? 32.1 Extremely effective ( ) 32.2 Very effective ( ) 32.3 Average effective ( ) 32.4 Less effective ( ) 32.5 Not effective at all ( ) 33 Have you seen an increase in business that you can attribute to the marketing? Kindly explain _______________________________________________________________ _____________________________________________________________________ 34 Do you partner with other players along the tourism value chain ­ like airlines, tour operators, game parks ­ to offer combined packages? ______________________________________________________________ 35 How effective is such packaging? 44
35.1 Extremely effective ( ) 35.2 Very effective ( ) 35.3 Average effective ( ) 35.4 Less effective ( ) 35.5 Not effective at all ( ) Kindly explain ____________________________________________________ 45
APPENDICES 3 HOTELS IN NAIROBI 1. Boma Inn Nairobi 2. Clarion Hotel 3. Crowne Plaza Hotel 4. Eka Hotel 5. Fairmount The Norfolk 6. Hemingways Nairobi 7. Intercontinental Nairobi 8. Jacaranda Hotel Nairobi 9. Laico Regency 10. Mvuli house 11. Nairobi Serena 12. Ole sereni hotel 13. Safari park hotel 14. Sarova Stanley 15. Sarova panafric 16. Panari hotel 17. Tribe hotel 18. Utalii hotel 19. Villa Rosa Kempinski 20. Fairview Hotel 21. Southern Sun Mayfair 22. Pride Inn 23. Sentrim Boulevard 24. Hilton Hotel 46
25. Bestwestern Hotel 26. Sankara 27. Meridian Hotel 28. Sentrim 680 29. Silver springs 30. Sovereign Suites 31. Hotel La mada 32. Nairobi safari club 33. Windsor Golf hotel and Country club 34. Gem Suites 35. Nomad palace hotel 36. Lavington Hill 37. West breeze hotel 38. Delta Hotel 39. Red court hotel 40. Wasini Luxury Suites & hotels 47

C WAMALWA

File: influence-of-marketing-strategies-on-attraction-of-international.pdf
Title: Influence of marketing strategies on attraction of international customers in the hotel industry in Nairobi, Kenya
Author: C WAMALWA
Author: Wamalwa Clare,University of Nairobi
Subject: Hotel industry
Keywords: Marketing strategies,hotel industry in Nairobi, Kenya
Published: Mon Nov 10 19:21:56 2014
Pages: 56
File size: 0.21 Mb


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