Effect of digital marketing strategies on performance of Commercial Banks in Kenya

Abstract

Digital marketing strategies are very important when designing and delivering new products and services to the potential clients and satisfying them accordingly. This study was aimed at examining and establishing the effects of digital marketing strategies on the performance of commercial banks in Kenya. Descriptive cross sectional survey was used as a research design that targeted a population of all the 43 commercial banks in Kenya. Questionnaires were used to collect primary data which was then analyzed by use of descriptive statistics. The relationship between effects of digital marketing strategies and performance was assessed by use of the regression analysis. The study found out that digital marketing platforms used by the commercial banks were mobile apps strategy, social media, website design/development, online advertising, display advertising and email marketing. The study also found out that Digital Marketing communication strategy enhanced communication between commercial banks and international clients, helped customers to get 24 hour service, made online technical easily available to clients, enhanced banks response to inquiries, enhanced efficiency and effectiveness, reduction in communication cost, improvement of information about product and price. The study also found out that digital transaction strategy has enabled banks in customization of promotion, increased flexibility in pricing, maintenance of lower inventory level, reduction in cost of transaction and reducing errors in procurement. Digital distribution strategy was found to have enabled in tracking transactions, reducing time for waiting for customers to receive products and services, reduction of delivery costs and reduction in number clients’ sales agents. Lastly, the study found out that digital marketing strategies enhanced banks performance, increased uptake of banks’ products and services, led to increase revenue, led market expansion through increased customer base in the bank, reduced on working capital, improved the performance of commercial banks as it enhanced uptake of bank products by the consumer, lower costs, lower working capital, increased traffic on companies’ website, increased bank’s cash flows and led to reduction in risk. The regression analysis established how digital marketing strategies have influenced the performance of commercial bank.