The Influence of Business Intelligence Technology on Marketing Strategy of Large Supermarkets in Nairobi

Abstract

Business Intelligence technology is a recent development in business decision-making, both strategic and tactical, and a key driver of profitability. Critical corporate decisions are now grounded on empirical data which constitute the basis of both descriptive and predictive analytics. This study aimed to investigate the influence of Business Intelligence technology on marketing strategies of large supermarkets in Nairobi. Supermarkets generate vast amounts of transactional data, which can comprise a source of value when appropriate BI technology is optimally deployed on them to extract potentially strategic information. Five large supermarkets were surveyed, out of which one had foreign origin but with local branches while all the remaining four had Kenyan origin and ownership. The study used a descriptive cross-sectional design where a structured questionnaire was used to collect data from respondents who were either marketing managers or information technology officers in their respective firms. Data analysis employed quantitative methods of descriptive statistics and logistic regression presented in tables and graphs. The results show that there was minimal use of BI technology by large supermarkets in Nairobi hence the influence of the same on marketing strategies was not extensive. However, the study was able to establish a statistically significant influence of certain aspects of BI technology on marketing strategy of large supermarkets in Nairobi. This was through logistic regression analysis. At the time of the study, only one of the five surveyed supermarkets had an online shopping facility, signaling limited collection of customer data. Online shopping is a source of more diverse, highly dynamic and complex types of consumer data than traditional data sources and can yield richer and more accurate customer information. Despite lack of access to such data, supermarkets employed other components of BI technology such as data warehousing and Market Basket Analysis which were used to some extent for market segmentation. One of the recommendations therefore is that supermarkets should widen their range of BI technologies and sources of data in order to enhance their marketing strategies.