EFFECTS OF PROMOTION STRATEGY ON PERFORMANCE OF

INSURANCE FIRMS

CATHERINE OKOTH

INDEX NUMBER: 7410040366

COURSE: DIPLOMA IN BUSINESS MANAGEMENT

INSTITUTION: THE KISUMU NATIONAL POLYTECHNIC

A RESEARCH PROJECT SUBMITTED TO THE KENYA NATIONAL

EXAMINATIONS COUNCIL IN PARTIAL FULFILMENT OF THE

REQUIREMENTS FOR THE AWARD OF DIPLOMA IN SUPPLY CHAIN

MANAGEMENT

NOVEMBER 2021
DECLARATION

This research project is my original work and has not been presented to any other institution.

Sign……………………………………………………… Date……………………………………

Catherine Akoth

This research project has been submitted for examination with our approval as the college

supervisor.

Sign ………………………………………… Date…………………………………………...

Mr. Steven Ouko

Lecturer

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DEDICATION

I dedicate this study to my parents. There is no doubt in mind that this study could not have been

without their many years of dedicated support, counsel and above all love. Your faith in me has

shaped my character and has made me to have faith in myself. To you I say thank you very much

and may God bless you abundantly.

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ACKNOWLEDGEMENT

This study would have not been possible without God for the gift life and strength he has given

me. It would not have been possible without the encouragement, support, criticism and assistance

of my family, friends, lecturers and my supervisor.

First, my appreciation goes to my supervisor Mr. Steven Ouko for the advice, suggestions,

criticisms and encouragement during the study. My appreciation also goes to my family for their

support, assistance and understanding which during the study. Their significance cannot be

emphasized. I would also want to thank all my friends and colleagues for their input throughout

the course period. I would also like to thank my classmates and friends for their support and

encouragement. I could not have completed this work without assistance, tolerance and

enthusiasm. Lastly

I thank Maddisson and Jubilee Insurance for allowing me collect data and my institution The

Kisumu National Polytechnic for the support and knowledge.

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 ABSTRACT

The main purpose of the research is to investigate the importance of promotion strategies on
performance of insurance firms in Kisumu county. The objectives of the study were, to identify
promotion strategies used by insurance firms, to determine the indicators of performance of
insurance firms. This was a descriptive study where the researcher gathered data from Maddisson
limited Kisumu and Jubilee insurance Kisumu. The type of the data being used is quantitative
data collection techniques in form of questionaries’ through drop and pick policy, controlled
observation and faces to face interview. The research was done around a population size of 100
employees, of the population size of 100 the research had a target population of 18 respondents
,12 respondents returned their questionnaire representing 67.6% of the target population. Data
analysis is done using tables, this was conducted on the basis of research objectives and the
research questions formulated. The study further stated promotion strategies used. The study
recommends that the firms should enlighten staff of the promotion strategies as most staff could
not give information about the methods used. The study also recommends that organizations
needs to take appropriate measures in addressing the challenges they face. This study
encountered the following limitations; the limitation of time allocated to the study was not
sufficient, financial constraints as the study entailed moving around when collecting data and a
lot of paper work, the current pandemic hindered the study at some point as the country was on
lockdown.

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Table of Contents

DECLARATION...........................................................................................................i

DEDICATION..............................................................................................................ii

ACKNOWLEDGEMENT...........................................................................................iii

ABSTRACT.................................................................................................................iv

CHAPTER ONE: INTRODUCTION...........................................................................1

1.1 Background of the study....................................................................................1

1.1.1 promotion strategy.........................................................................................1

1.1.2 Performance...................................................................................................2

1.1.3 Promotion Strategies on Performance...........................................................3

1.2 statement of the study..........................................................................................4

1.3 objectives.............................................................................................................5

1.4 research questions................................................................................................5

1.5 significance of the study......................................................................................5

1.6 scope of the study.................................................................................................6

1.7 limitation of the study..........................................................................................6

2.1 Introduction..........................................................................................................7

2.2 Theoretical literature review................................................................................7

2.2.1 Pricing theory.................................................................................................7

2.2.2 Product theory................................................................................................8

2.3 Empirical literature review...................................................................................9

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2.4 Research gap........................................................................................................9

2.5 Conceptual framework.........................................................................................9

Promotion strategy......................................................................................................10

Performance indicators................................................................................................10

Source: Author, 2021..................................................................................................10

3.1 Introduction........................................................................................................11

3.2 Research design..................................................................................................11

3.3. Target population.................................................................................................12

3.4 sample design.....................................................................................................12

3.4.1 Sampling Size..............................................................................................12

3.5 Data collection...................................................................................................13

3.6 Instrumentation..................................................................................................13

3.6.1 Data validity.................................................................................................13

3.6.2 Data reliability.............................................................................................14

3.7 Data analysis......................................................................................................14

CHAPTER FOUR.......................................................................................................15

DATA ANALYSIS, FINDINGS CONCLUSSIONS AND RECCOMENDATIONS

.....................................................................................................................................15

4.1 Introduction........................................................................................................15

4.2 Data Presentation...............................................................................................15

Source: research data, 2021.........................................................................................16

4.3 Data Analysis.....................................................................................................16

4.3.1 general information Table 4.2: Gender........................................................16

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Table 4.3: level of education.......................................................................................17

Table 4.4: current position..........................................................................................17

Table 4.5: how long have you been in the current position?......................................18

Table 4.6: what is your age.........................................................................................18

Table 4.7: your department.........................................................................................18

Table 4.8: how long have you been working in the organization...............................19

Table 4.9: terms of employment.................................................................................19

4.3.2 Promotion strategies.....................................................................................20

Table 4.10 firm focus on client needs and integrating all the activities of the firm to
satisfy those needs.......................................................................................................20

4.11 The firms promotional strategy elicit attention, interest, desire and action.21

4.12 The firm uses integrated marketing communications programmes.............21

4.13 The firm has loyalty programs with its clients.............................................22

4.14 The firm provides a lot of discounts (such as cash, sale, or trade discounts)
for our clients..............................................................................................................23

Table 4.14 promotion strategies adopted....................................................................23

Table 4.15 type of sales force strategy adopted..........................................................24

4.4 Performance Indicators.........................................................................................24

4.16 increase in efficiency in service delivery.....................................................24

4.17 increased market share.................................................................................25

4.18 increased profits...........................................................................................25

4.19 customer satisfaction....................................................................................26

4.20 employee retention.......................................................................................26

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4.5 Findings..............................................................................................................26

4.6 Conclusions........................................................................................................29

4.7 recommendations...............................................................................................30

4.8 suggestion for further study...............................................................................31

REFERENCES............................................................................................................32

APPENDIX: QUESTIONNAIRE...............................................................................35

SECTION B: PROMOTION STRATEGY................................................................36

SECTION C: PERFORMANCE.................................................................................37

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 CHAPTER ONE: INTRODUCTION

1.1 Background of the study

Firms need to be competitive to serve chosen segments effectively in a meaningful and
sustainable manner through development of appropriate marketing strategies. In the present day
business environment, market competitiveness is a function of how well firms can develop and
implement strategies, but competiveness also can impact the nature of chosen strategy by the
firm (Hugh and Elizabeth, 2006). A strategy is an organization’s commitment to particular
products, markets, customers, competitive approaches, and method of business operation and that
firms that strategically respond to competition improve their business performance and are able
to remain competitive than those that do not (Bernard and Koerte, 2010). The firms’ strategies
should be characterized by a responsive work organization, based on co-operative relations not
only within the firm but also in its relations with external partners such as customers, suppliers
and competitors. Flexibility and adaptability are also considered as key management concepts to
develop a sustainable competitive advantage, and successful firms apply them in new
organizational strategies

1.1.1promotion strategy
Successful marketing strategies depends upon addressing a number of key issues. These include:
what a company is going to produce, how much it will charge, how it is going to deliver its
products or services to the customer; and how it is going to tell its customers about its products
and services (Malshe and Sohi, 2009). Traditionally, they were known as the 4ps. As marketing
became more sophisticated discipline, a fifth ‘p’ was added, people. Recently two Ps were added
that is, process and physical evidence. This strategy combines product development, promotion,
distribution, pricing, relationship management and other elements. It identifies the firm's
marketing goals, and explains how they will be achieved, ideally within a stated timeframe.

Promotion strategy is an attempt by marketers to inform, persuade or remind consumers and to

influence their opinion or elicit response. Most firms use some form of promotion. because firm
goals vary widely, so does promotional strategies. The goal is to stimulate action from the people
or organizations of a target market. Promotion goals include creating awareness, getting

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people to try products, providing information, retaining loyal customers etc. Any promotion
campaign may seek to achieve one or more of these goals.

creating awareness; all too often, firms go out of business because people don’t know they exist
or what they do. Promotion through ads on social media platforms and local radio or television,
coupons in local papers, flyers and so forth can create awareness of a new business or product.

Providing information; informative promotion is more common in the early stages of the product
life cycle.

1.1.2Performance
Performance includes Multiple activities that help in establishing the goals of the organization,
and monitor the progress towards the target (Johnson et al., 2006). It is used to make adjustments
to accomplish goals more efficiently and effectively. Performance is what business executives
and owners are usually frustrated about. This is because even though the employees of the
company are hard-working and are busy doing their tasks, their companies are unable to achieve
the planned results. Results are achieved more due to unexpected events and good fortune rather
than the efforts made by the employees. However, for any business to be successful, functions
must be defined and accomplished. It is important for an organization to develop strategies that
are designed around the skills that would enhance the performance of the organization.
Performance is affected by myriad factors including: the lines of communication and command
connecting these individuals
5 (organizational authority structure and the degree of centralization), the resources and
information to which the individuals have access, the nature of the task faced by the individuals,
and the type and severity of the crisis under which the individuals operate (Richard et al., 2009).
Thus, performance refers to ability of an enterprise to achieve such objectives as high profit,
quality product, large market share, good financial results, and survival at pre-determined time
using relevant strategy for action (Koontz and Donnell, 2003). Performance provides the basis
for an organization to assess how well it is progressing towards predetermined objectives,
identify areas of strength and weakness and decide on the future initiatives with the goal of how
to initiate performance improvement (Vanweele, 2006). Rowley (2011) used both financial and
non- financial indicators. The financial indicators were a percentage growth in sales, labelled as
sales growth and percentage profit margin labelled as profitability. They used public image and
goodwill, quality of services and efficiency of operations as the non-financial indicator.
2
1.1.3 Promotion Strategies on Performance
Marketing plans help financial institutions employ marketing strategies that will help them
realize both their long-term and short-term objectives (Walker, 2011). Wilburn (2011) noted that
marketing strategy is a major contributor in the performance of a company and it helps a
company do business in accordance with its objectives and it helps many companies achieve
their targets or realign their objectives. Marketing is important in business as it helps convince
potential customers buy a company’s product it is more important due to many company’s
offering similar products a marketer must take his time to persuade and convince potential
buyers to buy their products. Eng and Keh (2007 believe that marketing effectiveness has to be
captured by the additional sales of a product over and above those that would have happened in
absence of any marketing or promotion. Although marketing managers have long believed that a
marketing impact on sales can persist longer than the current period, the tendency to assume that
marketing effect on sales is short-term is yet prevalent. They further argue that the longer uses of
marketing are better than less and shorter uses of it irrespective of the nature of contribution of
advertisement to sales. Korgaonkar et al., (2004) hypothesize that marketing campaigns were
successful in increasing sales when they were for nondurable products with unique attributes,
were geared to the consumer market and backed by adequate financial resources, and when they
featured unique and creative messages. It also found that favourable product attributes could be
achieved by marketing campaigns that promoted product uniqueness, had adequate financial
resources, and used creative messages and appropriate media. Elbanna and Child (2007) noted
that marketing performance is central to success in today’s fast moving competitive markets, and
measuring marketing’s performance is critical to managing it effectively. The process of
communicating the value of a product or service to customers, for the purpose of selling the
product or service has become complex in recent times due to globalization. There is also the
need to exceed the expectation of customers since satisfied customers are the organization’s least
expensive customers; buy again and again; talk favourably about the business, which means free
advertising; pay less attention to competition and that it tends to buy new products or equipment
lines an organization may add later (Kotler,1988). To create an effective marketing strategy, it is
necessary to include a communication strategy to support the actions to be taken. This strategy
should also include a schedule that contains both 7 traditional and non-traditional media (Lui,
Shah, & Schroeder, 2006). The importance of non-traditional

3
media is fast growing and they can be used create the right brand management that will lead into
more sales and brand recognition (Lui, Shah, &

Schroeder, 2006). It is important to note that none of the strategies is better than the other.
However, finding the right mix of both media can create the best communication/marketing
strategy for the company and specifically for the product being offered for sale.

1.2 statement of the study

In the present day business environment that is characterized by the increased competition
among local and international institutions, the emergence of more demanding customers and
great technological advances has resulted in a complex market in the financial business. In this
complex market environment, the marketing strategy of the company could be a competitive
advantage versus other companies provided that they deliver services and values that not only
meet the customer demands, but surpass them (Gattiker, 2007). Therefore, it goes without saying
that institutions need to investigate and apply a differentiated strategy versus others to stand out
in the crowd. Indeed, according to Porter (1985), organizational competitive advantage can be
achieved if the firm implements a value-creating strategy that is not simultaneously being
implemented by any current or potential competitors. This can be interpreted to mean that
sustained competitive advantage results from strategic assets. The objective of all businesses is to
make profits and improve their organization overall performance by increasing its sales at
remunerative prices. Marketing plays a vital role in marketing retail stores dealing with footwear
in the competitive operating environment. The retail stores have put in place more input on
understanding the drivers of success, like better utilization of its resources (technology,
infrastructure and employees), process of delivering quality service to its customers, coming up
with strategies to manage its customers. As one of the key elements of a company's success, the
selection of appropriate marketing strategy has been a focal point in both supply chain and
marketing channel structure of the retail store. Several studies have been undertaken both
internationally and nationally on the need of marketing strategies by a firm. By examining
market dynamism and complexity as perceptual phenomena, the present research will enhance
understanding of how marketing managers perceive and respond to uncertainty in enacted
environments. Understanding the influences of market uncertainty constituents is crucial because
they potentially have dissimilar and unexpected implications for theory. Consequently, this gap
leads to the following research

4
question: what are the effects of promotion strategy on the performance of Insurance firms in
Kisumu county?

1.3 objectives
The general objective of the study was;

i. To identify the methods of promotion strategy

ii. To determine the indicators of insurance firms performance

iii. To assess the relationship between promotion strategies and insurance firm performance.

1.4 research questions

i. What are the effects of promotion strategy?

ii. What are the indicators of performance?

iii. What is the relationship between promotion strategy and performance?

1.5 significance of the study

This study contributes to the research on the strategies of marketing, in the light of global
competitive challenges. In particular, it contributes to the rising body of research on how
Sacco’s in different regions of the world cope with the increasingly competitive global financial
market and strategies they use to not only maintain and improve their competitive positions,
but also acquire new market share regionally and internationally. The management and staff of
the various financial institutions in Kenya will find this study an invaluable source of material in
developing and harnessing their competitive strategies in the present evolving and dynamic
business environment. This study will provide insight on some of the challenges that may be
faced in the development and implementation of marketing strategies and how they can avoid
them. The government and regulators of the industry will also find invaluable information in
how marketing strategies can be adopted and as a result put in place policies that will guide and
encourage other organizations within and without the industry in implementing their strategies
in an ethical manner. The policy makers could use the results of the study to identify and bridge
up gaps in the existing marketing strategies.

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1.6 scope of the study
The research work analyses the activities of insurance firms within Kisumu County with regards
to the importance of marketing strategies on performance. The study was conducted at jubilee
insurance limited, Madison insurance and Apa insurance in Kisumu county.

1.7 limitation of the study

The study was faced by several limitations. First, a resource constraint was a major challenge.
Finance was a challenge since I could not comfortably move between the insurance firms which
were distant apart plus the paper work was too expensive. Second, there was limited access to
information. There was lack of response from some of the targeted respondents. Others failed to
return the questionnaires claiming that they had no time to fill them, while others argued that it
was against the supermarkets’ policy to disclose any information relating to their organizations
making support from their organizations a challenge.

Third, due to the current covid19 pandemic I faced barriers as the insurance firms had strict
policies on visitors and again I was personally exposed to the virus and was at risk.

The time allocated for the research was short due to the closure of schools prior to the covid19
upsurge

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 CHAPTER TWO

LITERATURE REVIEW
2.1 Introduction

Literature review involves the systematic identification, location and analysis of documents
containing information related to the research problem Amin (2005) This chapter provides the
review of literature on importance of marketing strategies on performance of insurance firms.it
includes the theories used, the empirical literature review, the research gap and eventually the
conceptual framework of the study.

2.2 Theoretical literature review

The framework of any theory of an organization is a set on initial premise which form the basis
for the logical development of propositions concerning the structure behaviour, performance and
the existence of the organization. Theories are conceptualization and models of business
enterprises which explain and predict their structure and behavior.as a result, the study is based
on two theories pricing theory and distribution theory

2.2.1 Pricing theory

Price is the value placed on goods and services what customers are willing to pay for a product
or service (Rapert, Linch, and Suter, 2008). The role of price in promotion strategy depends on
the target market, the product and the distribution strategies that are selected by management
(Cravens, 2006). Managers developing a pricing strategy should base their decisions on a careful
consideration of several factors such as costs, demand, customer impacts and competitor prices.
Pricing strategies provide general and consistent approaches for firms as they come up with
prices for their products. Lovelock (2011) suggested that pricing is the only factor of the
marketing mix strategy that produces revenues for the organization, whereas all the others are
related to expenses. The degree of complexity of pricing strategy amongst the service sector is
comparatively significant due to the high degree of homogeneity between most service groups
and shared service delivery and operating systems (Kotler, 2011). Differential pricing involves
selling the same product to different buyers under a variety of prices. This strategy works when
differences in the reactions to prices exist among consumers and consumer’s segments. The
quality and quantity of one product is sold for different prices to different buyers. One common
form of differential pricing is price skimming which involves

7
setting the price of the product relatively high compared to similar goods and then gradually
lowering it. A skimming strategy allows the firm to recover its cost rapidly by maximizing the
revenue it receives (Bitner, 2003). Competitive pricing strategies are based on the company’s
position in relation to its competition and include; penetration pricing, price signalling and going
rate pricing. Penetration pricing involves pricing the product relatively low compared to similar
goods in the hope that it secures wide market acceptance that allows the company to raise its
price. Price signalling puts high prices on low quality products. For a company to successfully
use price signalling strategy, a segment of the buyers must believe high prices indicate good
quality. It must also be difficult for the buyers to ascertain this quality. Going rate approach is
used when products compete on the basis of attributes other than price (Yulkur and Herbig,
2007)

2.2.2 Product theory

Product related marketing strategies are fundamental in any organization. These strategies
include use of product design and use of technology in product development as well as delivery.
The product can be argued to be the most important element of the retailing mix, as only with
reasonable products will the effort put into such things as pricing and promotions reap any
rewards Rose and Watkins (1997). Product is the principal item offered by a company to satisfy
the needs of their consumers. Kotler and Armstrong (2013) noted that some of the strategies
adopted in the domain of products are: perceived quality or image, as the market faces
competition, quality and reliability of the product offerings gain importance. Quality in this case
is viewed as customer’s perception of the product. Perceived quality or image has to be created.
Features- with many products in the market, what distinguishes them is the features. The ‘first
with the new feature’ has an advantage similar to the ‘first product’ in the market. In the
consumer non-durables, brand extensions have taken the line of added features. New products
face difficulties of acceptability in the market. The first product of its kind has an edge over
others and sets the standards for subsequent ones (Ramanuj, 2006). Successful product
management relies on a well planned and executed product strategy and product range strategy.
The product is the core of the marketing strategy. Strategies that relate to new product success
include overall fit with organization’s strengths and a defined opportunity in the environment.
There are at least six marketing strategy options related to the newness of products (Thorpe and
Morgan, 2007). These are innovation, new product lines, product line extensions, improvements

8
15 or changes in existing products,

9
repositioning and cost reductions. Consumers patronize a particular retail outlet as a result of
convenient location, friendly

personnel, desirable prices, and pleasant shopping atmosphere (Lewinson and Delozier 2012).
The patronage reason common to all sumers for visiting a certain a particular store, however is
the expectation of finding a product or a set of products that will fulfil some present or future
need.

2.3 Empirical literature review

Ayedun et al 2014, did a study on effects of marketing strategies on corporate performance of
estate surveying and valuation of firms.
Aliata et al 2013, did a study on influence of promotional strategies on bank performance

Atamana 2010 carried a study on long term effect of marketing strategies on brand sales

Onyango 2011 did a study on impact of relationship marketing on performance of insurance

organizations

Mwai 2015 did a study on factors that influence sales and marketing trategies adopted by
commercial banks.

Magunga 2010 did a study on effects of marketing strategies on performance of insurance

companies in Kenya

Muthengi 2015 did a study on effects of marketing strategies on sales of performance of

commercial banks

2.4 Research gap

From the previous empirical studies, it can be concluded that most research done relating to this
study in a general manner. Mainly, is the effects of marketing strategies on performance of
manufacturing organizations. In this study the dependent and independent variables are limited,
specific and they directly impact on each other. This study will focus on promotion strategy and
its impact on insurance firms and evaluate all studies previously done so as to have clear
understanding of the promotion strategy

2.5 Conceptual framework

From the literature reviewed, the conceptual framework is presented below the framework is
established on the relationship among sales promotions strategy and performance. The dimension
10
of sales promotion includes consumer promotion, trade promotion, and force promotion.in this
study promotion strategy serves as the independent variable, while performance serves as the
dependent variable. The study intends to find out the importance of promotion strategy on
performance of insurance firms in Kisumu county.

The conceptual model is summarized in table 2.1 below

Promotion strategy
 Consumer promotion
 Price off and special sale
 Premium offer
 Trade promotion
 Co-operative advertisement
 Dealer listed promotion
 Sales force promotion
 Salesman convention
 conference

Performance indicators
 Efficiency in service delivery
 Increased market share
 Increased profits
 Increased services
 Customer satisfaction
 Employee retention

Source: Author, 2021

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 CHAPTER THREE

METHODOLOGY
3.1 Introduction

This chapter presents the research methodology, the research design, target population, data
collection procedures and instruments as well as data analysis techniques.

3.2 Research design

A research design encompasses the methodology and procedures employed to conduct scientific
research. The design of a study defines the study type the researcher used a case study approach
which allows for intensive observation and investigation of various factors in the units of the
study Kothari, 1990. This research design facilitates a better understanding of the effects of
promotion strategy on performance of insurance firms. The study design is a descriptive method.
In addition, quantitative methods were applied in data collection and analysis. The descriptive
design is found suitable because it addresses major objectives and research questions proposed
Mugenda and Mugenda, (2003).

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3.3. Target population
The target population refers to a group of people or study subjects who are similar in more ways
and which forms the subject of the study in particular study that are being investigated cooper
and Schindler, 2007. The study comprised of two sales and marketing managers six sales
executives, four procurement staff. The study was conducted at jubilee insurance limited ,Apa
insurance firm and Maddisson insurance.

3.4 sample design

A sample design is the framework or road map that serves as the basis for the selection of a
survey sample and affects many other important aspects of a survey as well provides the basic
plan and methodology for selecting the sample(google).

3.4.1 Sampling Size

A sample is a finite part of a statistical population whose properties are studied to gain
information about the whole project. A good sample should be adequate and representative of the
underlying population. A sample of 30% is an adequate sample in a descriptive study of this
nature as supported by Gay (2005). An optimum sample is one which fulfils the requirements of
efficiency, representativeness, reliability and flexibility (Kothari, 2004). Amin (2005) emphasize
that a researcher must determine the sample size that will provide sufficient data to answer the
research problem. A sample is important to reduce costs, time and has a high degree of accuracy
(Amin, 2005). A sample size of 12 respondents was selected from employees of three insurance
firms. table 3.3 shows various categories of the respondents drawn from the target population.

Category Target population

Sample size

Percentage of target population

Percentage of sample size

Procurement clerks

6 4 33.3 33.3

Managers 2 2 11.1 16.7 Sales executives 10 6 55.5 50 Totals 18 12 100 100 Source: Author,2021 The
selected sample size of 12 was a representative of the population and thus the findings could be
generalized. The researcher will use simple random sampling because of the following reason; the ease
of assembling the sample. It will consider a fair way of selecting a sample from a given population since

13
every member will be given equal opportunity of being selected due to the representativeness of a
sample obtained by simple random sampling, it will reasonably make generalizations from the results of
the sample back to the population as one of the goals of

research will be able to make conclusions pertaining to the population from the results obtained from a
sample.

3.5 Data collection

According to Chandran, (2004), the main type and sources of data are primary and secondary
data. Primary data consists of data collected by the researcher from original sources from the
field. primary data was used in the form of structured questionnaires. Questionnaires were used
for the collection of data from insurance firms within Kisumu County; jubilee insurance limited,
Apa insurance firm and Maddison insurance. Despite the small number of target population; the
researcher used census method where respondents in the companies were supplied with
questionnaires. The questionnaires were structured in four areas that is; section. A general
information; section B effects of promotion strategy; section C performance of insurance firms
and section D the relationship between promotion strategy and performance. The questionnaires
were structured to answer inquiry questions based on 5 pint likert scale questions which were
close ended to give the respondents limited and predetermined responses to choose from. The
questionnaires were made of simple and easy to answer. Questionnaires were distributed to the
respondents by the researcher using a drop and pick method to reduce disruptions on the
respondent’s routines.

3.6 Instrumentation
Instrumentation refers to the selection or development and the later use of tools to make
observations about variables in a research study. The observations are collected, recorded, and
used as primary data. Instrumentation builds on the study design and problem statement and
assumes that both are approximately specified.in considering the quality of the instrumentation
the reviewer should focus on the rigor with which data collection is executed. Jaa Shea (2001)

3.6.1 Data validity

Validity refers to the extent to which an instrument measures what is supposed to measure, data
need not only to be reliable but also true and accurate. If a measurement is valid, it is also
reliable (Mugenda and Mugenda, 2003). To establish the validity of the data collection
instruments, the research instruments will be given to contractors, managers, district officials,
opinion leaders, consultants, supervisors, and political leaders in the region. The managers

14
and staffs will be

15
expected to tick if the item in the questionnaires addresses the influence of the efficient
performance in organizations. The content of the responses given by the managers

and other stakeholders will be checked against the study objectives and rated using a scale of
1(very relevant) to 4 (not very relevant). The Content Validity Index will be used to determine
the validity by adding up all the items rated using a scale of 3 and 4 by the managers and
dividing the total sum by the total number of items in the questionnaires. The coefficient of the
data gathered from the pilot study will be computed with assistance of Statistical Package for
Social Sciences (SPSS). Statistical package for social science is a software package used for
interactive, or batched statistical analysis. Current version as the brand name IBMSPSS.

3.6.2 Data reliability

Reliability refers to the consistence, stability, or dependability of the data. Whenever an
investigator measures a variable, he or she wants to be sure that the measurement provides
dependable and consistent results (Cooper & Schindler, 2003). A reliable measurement is one
that if repeated a second time gives the same results as it did the first time. If the results are
different, then the measurement is unreliable (Mugenda & Mugenda, 2003). To measure the
reliability of the data collection instruments an internal consistency technique using Cronbach's
alpha will be applied. Cronbach's alpha is a coefficient of reliability that gives an unbiased
estimate of data generalizability

3.7 Data analysis

Analysis is the process of categorizing, manipulating, ordering and summarizing data to obtain
answers from research questions. The study adopted descriptive statistics. According to Leary
(2004), descriptive analysis involves a process of transforming a mass of row data into tables,
charts with frequency, distribution and percentages which are vital part of making conclusions to
the data. The data collected from the questionnaires were checked for completeness and
accuracy. The questionnaire was coded according to each variable of the study to ensure margin
of error is minimized and assure accuracy during analysis.

16
 CHAPTER FOUR

DATA ANALYSIS, FINDINGS CONCLUSSIONS AND

RECCOMENDATIONS
4.1 Introduction
The research objective was to establish the effects of promotion strategy on the performance of
insurance firms in Kisumu county. This chapter presents the analysis, findings and the discussion
with regard to the objective: to determine promotion strategies, to determine the indicators of
performance and to assess the relationship between promotion strategy and performance. A total
of 12 questionnaires were issued out. The completed questionnaires were edited for
completeness and consistency. Of the 12 questionnaires distributed, 12 were returned. The
returned questionnaires’ represented a response rate of 100% and this response rate was deemed
to be adequate in the realization of the research objectives (Mugenda and Mugenda, 2003)

4.2 Data Presentation

The researcher administered questionnaires and sought to analyse the number of questionnaires
which were returned. Table 4.1 illustrates the response rate of respondents.

17
Table 4.1 respondent rate

Category Frequency (n) Percentage (%)

Questionnaire administered 12 100
Questionnaire returned 12 100
Source: research data, 2021

In reference to the above table the researcher administered 12 questionnaires. 12 out of the
questionnaires were returned, fully filled. This represented 100% response rate. A 50% response
rate is adequate and a response rate greater than 70% is very good Mugenda and Mugenda
(2003). hence the response rate was satisfactory as outlined in table 4.1.

4.3 Data Analysis

The data from the questionaries’ were analysed. The findings are discussed according to
the sections of the questionnaires. The four sections of the questionaries’ were:

Section A: General information.

Section B: Promotion Strategies.

Section C: Performance.

Section D: Relationship between promotion strategies and performance.

4.3.1 general information

Table 4.2: Gender

Gender Frequency (n) Percentage (%)

Male 8 66.7
Female 4 33.3
Total 12 100
Source: research data, 2021

In reference to table 4.2, it was established that out of the 12 respondents, 66.7% were men while
the remaining 33.3% were female. This indicated that male recorded the highest number of staff
compared to the female counterparts hence the firms are male dominated.

18
Table 4.3: level of education

Level Frequency (n) Percentage (%)

Diploma 6 50.0
Degree 4 33.3
Masters 2 16.7
Any other(specify) 0 0.0
Total 12 100
Source: research data, 2021

In reference to table 4.3, it was established that out of the 12 respondents,50.0% had diploma
qualifications,33.3% had degree qualifictions,16.7% had master qualification while non had no
academic qualifications. This implied that all of the staff had academic qualifications which was
important to the organizations.

Table 4.4: current position

Position Frequency (n) Percentage (%)

Procurement Clerk 4 33.3
Sales executives 6 50.0
Manager 2 16.7
Total 12 100
Source: research data, 2021

In reference to the table 4.4 above, it was established that out of the 12 respondents, 33.3% were
procurement clerks, 50.0% were sales executives, while the remaining 16.7% were managers.
This implied that most of the respondents were sales executives taken from the marketing
departments of the firms.

Table 4.5: how long have you been in the current position?
19
 Years Frequency(n) Percentage (%)
Less than 5 years 4 33.3
5-10 years 6 50.0
Over 10years 2 16.7
Total 12 100
Source: research data, 2021

In reference to table 4.5 above, it was established that out of the 12 respondents, 33.3% had spent
less than one year in their current positions 50.0% had spent 5-10 years in their current positions
while the remaining 16.7% had spent over 10 years in their current positions in the organizations,
this implied that most of the staff had spent more than five years in the organizations, giving the
organizations the much needed experience

Table 4.6: what is your age

Age Frequency (n) Percentage (%)

21-30 years 4 33.3
31-40years 2 16.7
41-50years 4 33.3
51-60years 2 16.7
Total 12 100
Source: research data, 2021

In reference to table 4.6 above, it was established that out of the 12 respondents, 33.3% belonged
to the age bracket of between 21-30 years 16.7%% belonged to between 31-40 years,33.3%
belonged to age racket between 41-50 years and the remaining 16.7% belonged to the age racket
between 51-60 years. This implied that the work force of the organization mainly was comprised
of staff between 21-30 years and 41-50 years.

Table 4.7: your department

Department Frequency (n) Percentage (%)

20
 Finance and administration 2 16.7

Procurement 4 33.3
Marketing 6 50.0
Total 12 100
Source: research data,2021

In reference to table 4.7 above, it was established that of the 12 respondets,16.7% were from the
finance and administration departmet,33.3% were from the procurement department, while the
remaining 50.0% were from marketing department. This implied that most of the respondents
were from the marketing department of the firms.

Table 4.8: how long have you been working in the organization

Duration Frequency (n) Percentage (%)

Less than 5 years 2 16.7
5-10 years 6 50.0
Over 10 years 4 33.3
Total 12 100
Source: research data,2021

In reference to table 4.8 above it was established that, of the 12 respondents in the study,16.7%
had spent less than 5 years in the orgaizatios,50.0% had spent 5-10 years I the organizations and
the remaining 33.3% had spent over 10 years in the firms. This implied that most of the staff had
spent over five years in the organizations which also gave them the much needed experience.

Table 4.9: terms of employment

21
 Term Frequency (n) Percentage (%)
Permanent 6 50.0
Casual 6 50.0
Total 90 100
Source: research data,2021
In reference to table 4.9 above, it was established that out of the 12 respondents in the
study,50.0% were employed under permanent basis while the remaining 50.0% were casuals.
This implied that half of the staff were on permanent basis and this offered job security to them

4.3.2 Promotion strategies

A firms promotion strategy should integrate its capability in a manner designed to make use of
corporate knowledge, skills and resources. It enables businesses to better meet their customers’
needs through added value services to their products. This section of the questionnaire sought to
get from the respondents the promotion strategies that have been used by the insurance firms in
Kisumu county. The range was ‘not at all’ (1) to ‘strongly agree’ (5).

Table 4.10 firm focus on client needs and integrating all the activities of the
firm to satisfy those needs

Response Frequency Percentage

very great extent 6 50.0
great extent 4 33.3
moderate extent 2 16.7
small extent 0 0.0
no at all 0 0.0
Total 12 100
Source: research data.2021

In reference to table 4.10 above, it was established that of the 12 respondents in the study 50.0%
agreed to a great extent that insurance firms focus on client needs and integrating all the
activities of the firm to satisfy those needs,33.3% agreed to a great extent while the remaining
16.7% agreed to a moderate extent. This implied that the insurance firms focus on client needs

22
and integrate all the activities of the firm to satisfy clients needs.

4.11 The firms promotional strategy elicit attention, interest, desire and action

Response Frequency Percentage

very great extent 6 50.0
great extent 6 50.0
moderate extent 0 0.0
small extent 0 0.0
no at all 0 0.0
Total 12 100
Source: research data.2021

In reference to table 4.11 above, it was established that of the 12 respondents in the study 50.0%
agreed to a great extent that the firms promotional strategy elicit attention, interest, desire and
action while the remaining 50.0% of the respondents also agreed to a great extent. This implied
that the insurance firms mainly promotional strategy elicit attention, interest and action.

4.12 The firm uses integrated marketing communications programmes

Response Frequency Percentage

very great extent 0 0.0
great extent 2 16.7
moderate extent 4 33.3
small extent 4 33.3
no at all 2 16.7
Total 12 100
Source: research data.2021

In reference to table 4.12 above, it was established that of the 12 respondents in the study none of
the respondents agreed to very great extent that the firms use integrated communication
programs 16.7% agreed to a great extent ,33.3% agreed to a moderate extent,33.3% agreed to a

23
small extent while the remaining 16.7% disagreed with the statement. This implied that most of
the respondents were either not conversant with the statement or the firms did no incorporate the
policy.

4.13 The firm has loyalty programs with its clients

Response Frequency Percentage

very great extent 6 50.0
great extent 6 50.0
moderate extent 0 0.0
small extent 0 0.0
no at all 0 0.0
Total 12 100
Source: research data.2021

In reference to table 4.13 above, it was established that of the 12 respondents in the study 50.0%
of the respondents agreed to a very great extent that firm has loyalty programs with its client
while the remaining 50.0% also agreed to a great extent with the statement. This implied that the
firms had loyalty programs with its clients.

24
4.14 The firm provides a lot of discounts (such as cash, sale, or trade discounts)

for our clients

Response Frequency Percentage

very great extent 2 16.7
great extent 2 16.7
moderate extent 4 33.3
small extent 2 16.7
no at all 0 0.0
Total 12 100
Source: research data.2021

In reference to table 4.13 above, it was established that of the 12 respondents in the study 16.7%
of the respondents agreed to a very great extent that the firm provides a lot of discounts (such as
cash, sale, or trade discounts) for the clients,16.7% of the respondents agreed to a great extent
while another 33.3% agreed to moderate extent and then the rest of the respondents agreed to a

small extent. This implied that the most of the respondents agreed that the insurance firms
provide a lot of discounts for the clients.

Table 4.14 promotion strategies adopted

Strategy Frequency Percentage

Consumer promotion 0 0.0
Trade promotion 0 0.0
Sales force promotion 12 100
Total 12 100
Source: research data,2021

In reference to table 4.13 above, it was established that of the 12 respondents in the study 100%
of the respondents agreed to that firms have adopted sales force strategy as the promotion
strategy used in marketing of the products and services. This implied that all the insurance firms
used the sales force strategy.
25
Table 4.15 type of sales force strategy adopted

Strategy Frequency Percentage

Salesman convention 10 83.3
Conference 2 16.7
Total 12 100
Source: research data,2021

In reference to table 4.13 above, it was established that of the 12 respondents in the study 83.3 %
of the respondents agreed that the firms use the salesman promotion strategy while the remaining
167% confirmed that the firms use conference strategy. This implied that the firms mainly use
the salesman convention method in promotion.

4.4 Performance Indicators

A firm’s foregoing objective is to maximize shareholder wealth. However, it has come out that
the same cannot be realized if the firm does not develop appropriate promotion strategy that
will

enhance its competitiveness. This was important for the study in order to determine whether
adoption of various promotion strategies by the insurance firms affected the following

4.16 increase in efficiency in service delivery

Response Frequency Percentage

very great extent 4 33.3
great extent 4 33.3
moderate extent 4 33.3
small extent 0 0.0
no at all 0 0.0
Total 12 100
Source: research data ,2021

In reference to table 4.16 above it was established that of the 12 respondents in the study,33.3%
agreed to a very large extent that there is increased efficiency in service delivery,33.3% agreed to
26
a great extent while the remaining agreed to a moderate extent. This implied that the firms have
increased in their service delivery indicating increase in performance.

4.17 increased market share

Response Frequency Percentage

very great extent 4 33.3
great extent 4 33.3
moderate extent 4 33.3
small extent 0 0.0
no at all 0 0.0
Total 12 100
Source: research data ,2021
In reference to table 4.17 above it was established that of the 12 respondents in the study,33.3%
agreed to a very great extent that increased market share is an indicator of performance,33.3%
agreed to great extent while the remaining 33.3% agreed to a moderate extent. This implied that
majority of the respondents agreed that increased market share is an indicator of performance.

4.18 increased profits

Response Frequency Percentage

very great extent 12 100
great extent 0 0.0
moderate extent 0 0.0
small extent 0 0.0
no at all 0 0.0
Total 12 100
Source: research data ,2021

In reference to table 4.18 above it was established that of the 12 respondents in the study 100%
of the respondents agreed to a very large extent that increased profits by the firms is an indicator
of performance, this implied that an increase in profits by organizations is directly related to

27
performance of the firms.

4.19 customer satisfaction

Response Frequency Percentage

very great extent 12 100
great extent 0 0.0
moderate extent 0 0.0
small extent 0 0.0
no at all 0 0.0
Total 12 100
Source: research data ,2021
In reference to table 4.19 above it was established that of the 12 respondents in the study 100%
of the respondents agreed to a very large extent that customer satisfaction is an indicator of
performance in an organization.

4.20 employee retention

Response Frequency Percentage

very great extent 4 33.3
great extent 4 33.3
moderate extent 4 33.3
small extent 0 0.0
no at all 0 0.0
Total 12 100
Source: research data ,2021

In reference to table 4.19 above it was established that of the 12 respondents in the study 33.3%
agreed to a very great extent that employee retention is an indicator of performance,33.3% of the
respondents agreed to a great extent while the remaining 33.3% agreed to a moderate extent.
This implied that most of the respondents agreed to the statement

4.5 Findings
28
Promotion strategies has a bigger effect on the firms performance which the managerial must be
able to adjust in order to maintain competition in the environment. The findings showed that the
firm should be in position to adopt the product strategy to enable the insurance firm to have
competitive advantage in the market. The study found out that the insurance firms uses sales
force promotion i.e. salesman convention and conference strategy to a great extent. Malshe and
Sohi, (2009) noted that successful marketing depends upon addressing a number of key issues.
These include: what a firm is going to produce, how much it will charge, how it is going to
deliver its products or services to the customer; and how it is going to tell its customers about its
products and services. The product is the core of the promotion strategy. Strategies that relate to
new product success include overall fit with organization’s strengths and a defined opportunity
in the environment. Lewinson and Delozier (2012) noted that successful product management
relies on

a well planned and executed promotion strategy and product range strategy that includes
convenient location, friendly personnel, desirable prices, and pleasant shopping atmosphere.
These was consistent with the findings of the study which established that product strategy in the
retail stores ensured that the stores offer broad product line, stock products for different customer
clusters, ensures that quality and reliability of the product offerings gain importance, utilize
product design and technology in product development and that utilize early adopters for new
product ideas and feedback. 41 Cravens (2006) found out that managers developing a pricing
strategy should base their decisions on a careful consideration of several factors such as costs,
demand, impact to the customer, implications on the quality and competitor prices.A business
organization must sell products in order to survive and grow. This happens if the awareness of
the product is created among the potential buyers through advertisement and promotion
activities. Promotion serves to create a psychological effect to customers, which encourages the
decision to purchase the product. A firm should develop a promotion process that will remain
ongoing communication between the company on one side and existing and potential customers
on the other side. The study found out that the promotion strategy of the insurance firm focus on
consumer needs and integrate all activities of the organization to satisfy those needs and that the
outlet promotional strategy elicit attention, interest, desire and action. This was found to be
consistent with Kimball (2002) findings that effective sales promotion campaign enables a
business organization to successfully out-brand its competitors is a continuous battle for the
hearts and minds of the market share and customers. Lewinson and Delozier (2012) suggest that
29
it is important for institutions to build up channels of 42 communication with potential
customers, and use marketing intelligence to gather any information that an institution would
find useful in a competitive environment. The study found that it is necessary for organizations
to continually review promotion strategies with an aim of reviewing and aligning them with the
overall business environment. This process was necessary because the business environment is
dynamic and it requires constant re-evaluation and re-alignment of business strategies to remain
relevant in the market and ahead of the competition. Jobber and Fahy, (2006) noted that
marketing strategies are significant in an organization in increasing the sales, market share and
improving customer loyalty. This makes the products and services of an organization more
popular with the market. Further, promotion strategies are significant in exploration of new
markets and spread of business to new territories so as to raise awareness of the products and
services offered in a place where an

30
organization is establishing its branches. The findings were found to be consistent with the
findings of the study which established that promotion strategies used by insurance firms had
resulted in increased sales, number of footwear sold, enhance purchase of products and increase
market penetration of firms.

4.6 Conclusions
In any organization, marketing always strives to position their clients at the center stage of all
their business operations. This is with the aim of ensuring that they bring out superior
performance of a firm. Customer needs and expectations evolve over time and delivering
consistently high quality products and services and responsiveness to changing marketplace
needs become important for the success of a firm. This is achieved through implementation of
marketing activities designed to satisfy customer needs better than competitors are able to satisfy
customer needs. It can be concluded that the insurance firms retail stores have adopted the
promotion mix to help them improve their performance and gain market share. In order to
improve sales and market share, firms should consider offering financial services in a right
manner and also sell relevant products to the public. A firms promotion strategy should be
tailored towards realizing the customer satisfaction goal. In order to achieve an effective
promotion strategy, there is need to make it an integral component of overall firm strategy,
defining how the firms will successfully engage customers, prospects, and competitors in the
market arena. On the basis of the study findings, it is concluded that the factors are responsible
for improving the firms’ performance among the insurance retail sector include: consumer
promotion, trade promotion and sales force promotion.

31
4.7 recommendations
Managers should realize that the appropriateness of a particular promotion strategy, whether
adapted, standardized, or somewhere in between, hinges on its fit with external environmental
factors that the firm operates in. Hence managers should concentrate their limited attention and
resources on finding the right promotion mix that will improve the firm’s performance. In
addition, marketing managers need to comprehend the fact that although some elements (e.g.,
consumer promotion, trade promotion and sales force promotion) still exert a positive and
significant effect on the firm performance among insurance firms and therefore the firms should
also endeavour to examine the potential value creation of promotion strategies and align this
value to their overall strategy. The study established that the insurance firms undertake
promotional strategy to market its services and products and it is recommended that there is the
need for the firms to adopt a more

32
modern technological marketing tool in their businesses. The firms can use social media to create
a viral market for their products and services. The firms must also create links on social media to
drive traffic to their corporate websites. Marketing managers need to integrate all facts of
strategy; they need adequate analytical capabilities to perform this essential boundary-spanning
role. These competencies enable them to identify threats and opportunities skilfully within their
business environments, monitor and access environmental change, and improvise promotion
strategy accordingly. Such capabilities enable promotion of the marketing concept to senior
management in the firm. This is vital, as failure in this respect leads to failed strategy execution
and even a poor image of marketing within the firm

4.8 suggestion for further study

The study centered on ways of improving a firm’s performance through pursuing of appropriate
promotion strategy. The research suggests that further investigation on the role of promotion
strategy on the level of customer loyalty and satisfaction be undertaken. In addition, other
researchers can test other moderators to an effective implementation marketing strategy and
identifying which of the variables have the most significant effect on the performance of a firm.
In order to assess the impact of the macro-environment on the promotion strategies and double
bottom line of insurance firms, further research can be conducted, studies would have to be
conducted in order to delve deeper into those promotion strategy components which have a
palpable socioeconomic impact on companies’ clients over a period of time as well as those
strategies which drive client acquisition rates and the profitability of organizations.

33
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APPENDIX: QUESTIONNAIRE

SECTION A –GENERAL INFORMATION

1 Gender
Male

Female

2 What is your level of education?

Diploma

Degree

Masters

Any other (specify)

3 How long have you been in your current position?

Less than 5 years

5-10 years

Over 10 years

4 How long have you been working in your organization?

Less than 5 years

5-10years

Over 10 years

5 what is your age

21-30yrs

38
 31-40yrs

41-50yrs

51-60 yrs.

6 What is your

department Finance and

administration Marketing

Procurement

7 What are your employment terms?

Permanent basis

Contract basis

SECTION B: PROMOTION STRATEGY

8 Kindly indicate using a tick (√) the extent to which you agree with

the following statements

Agree to a Agree to Partially

No Statement Disagree
very large a large agree

firm focus on client needs and

1. integrating all the activities of the firm

to satisfy those needs

39
 The firms promotional strategy elicit
2.
attention, interest, desire and action

The firm uses integrated marketing

3.
communications programs

The firm has loyalty programs with its

4.
clients

The firm provides a lot of discounts to

5. services offered (such as cash, sale, or

trade discounts) for our clients

9 What are the promotion strategies adopted?

Consumer promotion
Trade promotion
Sales force promotion

SECTION C: PERFORMANCE

1 Kindly indicate using a tick (√) the extent to which you agree with

the following statements

Agree to a Agree to Partially

No Statement Disagree
very large a large agree

increase in efficiency in service

1.
delivery

2. increased market share

40
3. increased profits

4. customer satisfaction

5. employee retention

41