Effect of brand management on the performance of star rated hotels in Nairobi County, Kenya

Waithaka, Maina
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Strathmore University
Global, regional and local shutdowns after the Covid-19 pandemic have seen players in the hotel industry record losses and some firms have been forced to permanently shut down. The remaining hotels have to demonstrate their capability to sustain performance; and in this relation, star-rated hotels have to demonstrate their ability to sustain their performance through competitive brand management strategies. Despite increased literature on branding, most of the studies have focused on firms outside of the hospitality industry within the country hence they are limited studies focusing on brand management and performance of star-rated establishments. This study sought to examine the influence of brand management on the performance of star-rate hotels in Kenya. The study specifically examined the effect of brand identity on performance, brand association on performance, brand recognition on performance, and brand personality on the performance of star-rated hotels in Kenya. The research was grounded on the resource-based-view theory, the social identity theory, and the theory of brand loyalty. The study was premised on a positivism research philosophy. A descriptive research design was adopted which allowed for the examination of the phenomena in its natural setting. The study population was the 53 star-rated hotels within Nairobi County. The study targeted three senior managers in each of the star-rated hotels. The study employed a census approach in selecting 159 managers from the hotels using a judgemental sampling approach. The research utilized a structured research questionnaire with both physical and online approaches used in the data collection process. The study research instrument was pretested among 10% of the sample respondents. This was integral in supporting reliability and validity testing. The collected data was analyzed using quantitative techniques such as percentages, frequencies, means, correlation tests, and regression tests. The research was able to obtain a 77% response rate which was suitable for quantitative analysis. The response indicated that most of the participants were marketing managers and finance managers. The test for correlation revealed that there was a moderate positive effect of brand identity on organization performance. Results also noted a weak positive effect of brand association, brand recognition, and brand personality on the performance of the star-rated hotels. The regression tests established that 38.2% of the changes in the organizational performance of star-rated hotels are as a result of brand management practices. The regression tests supported the conclusion that brand association has an insignificant effect on the organizational performance of star-rated hotels. Further, conclusions were that brand identity, brand recognition, and brand personality had a positive and significant effect on the organizational performance of star-rated hotels. The study recommends that the Tourism regulatory authority in partnership with the various star-rated hotels can develop standardized branding guidelines which will help the local hospitality industry compete with international hotels. Further, the research recommends hotels should develop suitable package offerings focused on the local customer base who shy away from established star-rated hotels. More so, the management should review their competitor's service and product offering to ensure their brand recognition practices are distinct in the market which is critical to enhanced performance. Lastly, the management can employ social media channels in their product placement to ensure they are able to appeal to a larger market and create recognition for their brand offering. The study was limited severely by the closure of some of the hotels as a result of the ongoing pandemic containment measures. However, this limitation was overcome through the inclusion of other hotels which are not highly rated but are registered and licensed to operate within the borders of Nairobi City County.
A Thesis submitted in partial fulfillment of the requirements for the award of the Degree of Masters of Business Administration at Strathmore University Business School
Brand management, Star rated hotels_Nairobi