Impact of Digital Marketing on Sales Growth of Small and Medium Enterprises in Nairobi, Kenya

Abstract

Marketing has been a challenge for small and medium enterprises (SMEs) around the world due to its cost. Traditional marketing which involves television, radio and billboards come at a cost way high for these SMEs and therefore growth of these companies becomes a challenge due to low sales as a result of awareness of goods and services provided. Digital marketing has provided small and medium enterprises a platform to create awareness to consumers on what they offer due to their relatively low cost. Previous studies done in relation to the effect of digital marketing and social marketing either had operational or environmental differences which provided a research gap hence motivated the study objective which is to determine the impact of digital marketing on sales growth of SMEs in Nairobi, Kenya. The study used a descriptive cross-sectional research design to allow analysis of SMEs in Nairobi at the same time. The target population was mainly from the Top 100 SMEs for the last 5 years and it had a population of 699 SMEs. From this population, a sample size of 255 SMEs was determined and randomly selected to answer the research objective. Primary data was collected using questionnaire as the data collection instrument which was sent to either the SME owners or marketing heads. The questionnaire was structured to provide uniformity in responses. The responses were analyzed through mean scores, Pearson’s correlation test and Kruskal-Wallis test using SPSS v.21 software. The study results indicated that email marketing and social media marketing had significant impact on SMEs sales growth and to a great extent. Mobile marketing, search engine optimization (SEO) marketing, pay-per-click (P.P.C), and online marketing all had a significant effect on SMEs’ sales growth and to a moderate extent. The study findings indicated that lack of digital media knowledge was the greatest challenge for SMEs in the adoption of digital marketing, followed by lack of suitable digital marketing techniques and the lack of finances. The findings led to the conclusion that email marketing and social media marketing are important to improve SMEs sales while the other techniques (mobile marketing, SEO marketing, P.P.C and online marketing) had little or moderate effect on sales. The study recommended that SMEs should be trained and sensitized on the available digital marketing techniques and how they are suitable for their businesses. The study also recommended that proper policies should be made by the government that assist SMEs to adopt digital marketing. Finally the study recommended that SMEs should be provided with funds in order to finance their digital marketing.