Influence of digital marketing strategies on the competitive advantage of commercial banks in Kenya
Makau, Gratia Mbithe
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The local banking industry has been facing intense competition from various players in the financial industry, such as Saccos, Microfinance firms, and digital lending platforms in competing for customers. Further, increasing changes in the regulatory and business climate have increased the pressure on local banks to enhance their capacity to remain competitive. The emergence of new technologies and digital disruption has presented the commercial banks with new tools that can be adapted to enhance their competitiveness. Despite this, there is scant literature examining the nature of the influence of various digital marketing strategies on the competitive advantage of commercial banks. The research sought to establish the influence of social media marketing, search engine optimization, and e-mail marketing on the competitive advantage of commercial banks in Kenya. The research was grounded on the technology acceptance model and the competitive advantage theory. The study relied on a quantitative research approach using a descriptive research design. The target population of the study was drawn from the 41 commercial banks. The study sampled five respondents; operations manager, chief technology officers, human resource manager, digital marketing managers, and finance managers drawn from the commercial banks. The sample size for the research was 136 respondents. The study used a structured questionnaire to collect data. The study conducted a pretest of the research tool, with 10% of the sample respondents. The collected data were analysed using descriptive statistics, correlation analysis, and regression analysis. The findings of the study were presented graphically and interpreted in line with the research objectives. The study results indicate that most of the banks had deployed the use of social media marketing, e-mail marketing, and interactive websites. The correlation result established there is a positive and significant effect of social media marketing, search engine optimization, and e-mail marketing on the competitive advantage of commercial banks. The regression results showed that digital marketing strategies determined 67.2% of the variations in the competitive advantage of banks. The study concludes that deploying social media marketing, search engine optimization, and e-mail marketing will positively influence the competitive advantage of commercial banks. The research recommends that commercial bank should enhance their investment in new technologies to drive the development of digital-only bank branches and online platforms. The study also recommends that commercial banks should foster their e-mail and social media marketing tools. The main contribution of my study will be to commercial banks since it offers critical knowledge on the effect of specific digital marketing strategies on their institutional competitiveness, which can be essential to their future decision making. The study was also limited by respondents who were unwilling to participate in the research due to fear of their anonymity not being upheld. This was mitigated by producing a letter from the University which indicated that the research was purely for academic purposes.