Analysis of Product Differentiation on the Performance of Supermarkets in Nairobi City County, Kenya
DOI:
https://doi.org/10.53819/81018102t6044Abstract
The rapidly changing Kenya market creates challenges for retail stores to retain their customers and build new competitive strategies against modern retailing. The study sought to analyze the influence of product differentiation strategy on the performance of supermarkets in Nairobi, to evaluate how cost leadership affect performance of supermarkets in Nairobi. The target population consisted of 147 managers and supervisors form the 7 main supermarkets in Nairobi City County. Primary data was collected using a semi—structured questionnaire and the data was analyzed using SPSS. Descriptive and Inferential statistics were used to analyze the data. The study used a multiple regression model to show the relationship between the study variables. The results obtained were represented on tables, charts and graphs. The findings revealed an R squared of 0.696 and adjusted R squared of 0.663 at 95% significance level, implying that the competitive strategies adopted in this study explained 69.6 percent of the variation in performance of supermarkets in Nairobi City County. The study also found that product differentiation strategy as an aspect of competitive strategies had a positive and significant effect on the performance of supermarkets in Nairobi (β =.357, p=.029<.05). The study concluded that product differentiation as a competitive strategies adopted had positive and significant effect on the performance of supermarkets in Nairobi. The study thus recommended that the supermarkets in Nairobi City County should consider fully implementing competitive strategies such as product differentiation as ways of enhancing their performance.
Keywords: Product Differentiation, Performance, Supermarkets, Competitive Strategies
References
Abbas, A. (2021). Logistics Management Practices and Performance of Leading Supermarkets in Nairobi County, Kenya (Doctoral dissertation, University of Nairobi).
Alkitbi, S. S., Alshurideh, M., Al Kurdi, B., & Salloum, S. A. (2020, October). Factors affect customer retention: A systematic review. In International Conference on Advanced Intelligent Systems and Informatics (pp. 656-667). Springer, Cham. https://doi.org/10.1007/978-3-030-58669-0_59
Atalaya, M. and Fulya, S. (2013). The Relationship between Innovation and Firm Performance: An Empirical Evidence from Turkish Automotive Supplier Industry. Social and Behavioral Sciences, 7(3), 226 – 235. https://doi.org/10.1016/j.sbspro.2013.04.026
Bindra, S., Parameswar, N., & Dhir, S. (2019). Strategic management: The evolution of the field. Strategic Change, 28(6), 469-478. https://doi.org/10.1002/jsc.2299
Bischoping, K., & King, A. D. (2019). The forgotten work of cultural workers. Labour: Journal of Canadian Labour Studies/Le Travail: revue d’Études Ouvrières Canadiennes, 84, 259-278. https://doi.org/10.1353/llt.2019.0039
Cho, J., & Lee, J. (2018). Internationalization and performance of Korean SMEs: The moderating role of competitive strategy. Asian Business & Management, 17(2), 140-166. https://doi.org/10.1057/s41291-018-0036-8
Darmawan, D., & Grenier, E. (2021). Competitive Advantage and Service Marketing Mix. Journal of Social Science Studies (JOS3), 1(2), 75-80. https://doi.org/10.56348/jos3.v1i2.9
Diba, A. G., & Omwenga, J. Q. (2019). Influence of strategic orientation on firm performance of retail supermarkets in Kenya. International Academic Journal of Human Resource and Business Administration, 3(5), 296-315.
Elmi, D. F. (2021). THE EFFECT OF COMPETITIVE STRATEGIC ON ORGANIZATIONAL PERFORMANCE IN TELECOMMUNICATION COMPANIES IN MOGADISHU SOMALIA. EPRA International Journal of Multidisciplinary Research (IJMR), 84.
Elms, R. E., and Low, M. (2013). Supply Chain Integration, Quality Management and Firm Performance: Strategy in Emerging Economies. Academy of Management Journal, 43, 249–267.
Emery R. and Trist U., (2015). Principles of Marketing, 2nd Edition, Harlow Pearson Education Limited.
Ferdinard, B. (2012). Do Cost Leadership Strategy and Process Innovation Influence the Performance of Malaysia Hotel Industry? Asian Social Science, 10(10): 134 – 143.
Hambrick H. (2013). Strategic Management Theory and Application. Oxford University Press.
Hendriyani, C., & Auliana, L. (2018). Transformation from relationship marketing to electronic customer relationship management: A literature study. Review of Integrative Business and Economics Research, 7, 116-124.
Hofer W., (2015). Principles of Marketing, 2nd Edition, Harlow Pearson Education Limited.
Hua, L.T. (2011). Sustainable Competitive Advantage for Market Leadership Amongst the Retailers in Malaysia. Journal of Global Management, 2(1), 227 – 251.
Karimi, E., & Waruguru, M. (2018). Influence of Vertical Integration on Organizational Response to Dynamic Environment in Wholesale and Retail Supermarket Outlets in Nakuru, Kenya. Jomo Kenyatta University of Agriculture and Technology, Nairobi, Kenya.
Kharub, M., Mor, R. S., & Sharma, R. (2018). The relationship between cost leadership competitive strategy and firm performance: A mediating role of quality management. Journal of Manufacturing Technology Management. https://doi.org/10.1108/JMTM-06-2017-0116
Kirimo, P. K. (2015). Competitive Positioning Strategies in Response to Changing Rice Demand Patterns in Kenya. International Journal of Scientific and Research Publications, 5(10), 1 – 15.
Kobia, F. K. (2018). Differentiation Strategy and Performance of Bata Shoe Company Outlets in Nairobi City County, Kenya. Unpublished Masters thesis. Kenyatta University.
Kumar, M., Basu, P., & Avittathur, B. (2018). Pricing and sourcing strategies for competing retailers in supply chains under disruption risk. European Journal of Operational Research, 265(2), 533-543. https://doi.org/10.1016/j.ejor.2017.08.019
Lau, R. S. (2012). Competitive Factors and Their Relative Importance in the US Electronics and Computer Industries. International Journal of Operations & Production Management, 22(1), 125–135. https://doi.org/10.1108/01443570210412105
Liu, W., & Atuahene-Gima, K. (2018). Enhancing product innovation performance in a dysfunctional competitive environment: The roles of competitive strategies and market-based assets. Industrial Marketing Management, 73, 7-20. https://doi.org/10.1016/j.indmarman.2018.01.006
Maumbe, B. M., & Chikoko, L. (2022). The rise of supermarkets in Zimbabwe against a tide of macroeconomic uncertainty. Development Southern Africa, 39(3), 289-302. https://doi.org/10.1080/0376835X.2020.1832443
Mutinda, C. K., & Mwasiaji, E. (2018). Competitive strategies and performance of family owned supermarkets in Machakos County, Kenya. International Academic Journal of Human Resource and Business Administration, 3(3), 31-51.
Mutinda, C. K., & Mwasiaji, E. (2018). Competitive strategies and performance of family owned supermarkets in Machakos County, Kenya. International Academic Journal of Human Resource and Business Administration, 3(3), 31-51.
Mwenda, G. (2020). Strategic orientation and organization growth: A review. International Academic Journal of Human Resource and Business Administration, 3(8), 133-142.
Narula, S., Rana, S., Srivastava, S., & Kharub, M. (2021). Improving firm performance using market orientation and capabilities: a case study approach. South Asian Journal of Business Studies. https://doi.org/10.1108/SAJBS-10-2021-0375
Pantano, E., Pizzi, G., Scarpi, D., & Dennis, C. (2020). Competing during a pandemic? Retailers’ ups and downs during the COVID-19 outbreak. Journal of Business Research, 116, 209-213. https://doi.org/10.1016/j.jbusres.2020.05.036
Porter, M. E. (1985). Competitive Advantage. Free Press.
Porter, M. E. (2008). Competitive Advantage: Creating and Sustaining Superior Performance by
Porter, M. E. (2008). The Five Competitive Forces that Shape Strategy. Harvard Business Review, 86(1), 79 – 93.
Sharma, M., Luthra, S., Joshi, S., & Kumar, A. (2021). Accelerating retail supply chain performance against pandemic disruption: adopting resilient strategies to mitigate the long-term effects. Journal of Enterprise Information Management. https://doi.org/10.1108/JEIM-07-2020-0286
Spinelli, G., Nelson-Becker, H., & Ligossi, R. (2019). Consumer Competence Strategies, Spiritually Inspired Core Values and Locus of Control: What Are the Links?. Sustainability, 11(17), 4787. https://doi.org/10.3390/su11174787
Stead, J. G., & Stead, W. E. (2019). Why Porter is not enough: economic foundations of sustainable strategic management. In Rethinking strategic management (pp. 67-85). Springer, Cham. https://doi.org/10.1007/978-3-030-06014-5_4
Wang, C. H., Chen, K. Y., and Chen, S. C. (2013). Total Quality Management, Market Orientation and Hotel Performance: The Moderating Effects of External Environmental Factors. International Journal of Hospitality Management, 31(1), 119-129. https://doi.org/10.1016/j.ijhm.2011.03.013
Alkitbi, S. S., Alshurideh, M., Al Kurdi, B., & Salloum, S. A. (2020, October). Factors affect customer retention: A systematic review. In International Conference on Advanced Intelligent Systems and Informatics (pp. 656-667). Springer, Cham. https://doi.org/10.1007/978-3-030-58669-0_59
Atalaya, M. and Fulya, S. (2013). The Relationship between Innovation and Firm Performance: An Empirical Evidence from Turkish Automotive Supplier Industry. Social and Behavioral Sciences, 7(3), 226 – 235. https://doi.org/10.1016/j.sbspro.2013.04.026
Bindra, S., Parameswar, N., & Dhir, S. (2019). Strategic management: The evolution of the field. Strategic Change, 28(6), 469-478. https://doi.org/10.1002/jsc.2299
Bischoping, K., & King, A. D. (2019). The forgotten work of cultural workers. Labour: Journal of Canadian Labour Studies/Le Travail: revue d’Études Ouvrières Canadiennes, 84, 259-278. https://doi.org/10.1353/llt.2019.0039
Cho, J., & Lee, J. (2018). Internationalization and performance of Korean SMEs: The moderating role of competitive strategy. Asian Business & Management, 17(2), 140-166. https://doi.org/10.1057/s41291-018-0036-8
Darmawan, D., & Grenier, E. (2021). Competitive Advantage and Service Marketing Mix. Journal of Social Science Studies (JOS3), 1(2), 75-80. https://doi.org/10.56348/jos3.v1i2.9
Diba, A. G., & Omwenga, J. Q. (2019). Influence of strategic orientation on firm performance of retail supermarkets in Kenya. International Academic Journal of Human Resource and Business Administration, 3(5), 296-315.
Elmi, D. F. (2021). THE EFFECT OF COMPETITIVE STRATEGIC ON ORGANIZATIONAL PERFORMANCE IN TELECOMMUNICATION COMPANIES IN MOGADISHU SOMALIA. EPRA International Journal of Multidisciplinary Research (IJMR), 84.
Elms, R. E., and Low, M. (2013). Supply Chain Integration, Quality Management and Firm Performance: Strategy in Emerging Economies. Academy of Management Journal, 43, 249–267.
Emery R. and Trist U., (2015). Principles of Marketing, 2nd Edition, Harlow Pearson Education Limited.
Ferdinard, B. (2012). Do Cost Leadership Strategy and Process Innovation Influence the Performance of Malaysia Hotel Industry? Asian Social Science, 10(10): 134 – 143.
Hambrick H. (2013). Strategic Management Theory and Application. Oxford University Press.
Hendriyani, C., & Auliana, L. (2018). Transformation from relationship marketing to electronic customer relationship management: A literature study. Review of Integrative Business and Economics Research, 7, 116-124.
Hofer W., (2015). Principles of Marketing, 2nd Edition, Harlow Pearson Education Limited.
Hua, L.T. (2011). Sustainable Competitive Advantage for Market Leadership Amongst the Retailers in Malaysia. Journal of Global Management, 2(1), 227 – 251.
Karimi, E., & Waruguru, M. (2018). Influence of Vertical Integration on Organizational Response to Dynamic Environment in Wholesale and Retail Supermarket Outlets in Nakuru, Kenya. Jomo Kenyatta University of Agriculture and Technology, Nairobi, Kenya.
Kharub, M., Mor, R. S., & Sharma, R. (2018). The relationship between cost leadership competitive strategy and firm performance: A mediating role of quality management. Journal of Manufacturing Technology Management. https://doi.org/10.1108/JMTM-06-2017-0116
Kirimo, P. K. (2015). Competitive Positioning Strategies in Response to Changing Rice Demand Patterns in Kenya. International Journal of Scientific and Research Publications, 5(10), 1 – 15.
Kobia, F. K. (2018). Differentiation Strategy and Performance of Bata Shoe Company Outlets in Nairobi City County, Kenya. Unpublished Masters thesis. Kenyatta University.
Kumar, M., Basu, P., & Avittathur, B. (2018). Pricing and sourcing strategies for competing retailers in supply chains under disruption risk. European Journal of Operational Research, 265(2), 533-543. https://doi.org/10.1016/j.ejor.2017.08.019
Lau, R. S. (2012). Competitive Factors and Their Relative Importance in the US Electronics and Computer Industries. International Journal of Operations & Production Management, 22(1), 125–135. https://doi.org/10.1108/01443570210412105
Liu, W., & Atuahene-Gima, K. (2018). Enhancing product innovation performance in a dysfunctional competitive environment: The roles of competitive strategies and market-based assets. Industrial Marketing Management, 73, 7-20. https://doi.org/10.1016/j.indmarman.2018.01.006
Maumbe, B. M., & Chikoko, L. (2022). The rise of supermarkets in Zimbabwe against a tide of macroeconomic uncertainty. Development Southern Africa, 39(3), 289-302. https://doi.org/10.1080/0376835X.2020.1832443
Mutinda, C. K., & Mwasiaji, E. (2018). Competitive strategies and performance of family owned supermarkets in Machakos County, Kenya. International Academic Journal of Human Resource and Business Administration, 3(3), 31-51.
Mutinda, C. K., & Mwasiaji, E. (2018). Competitive strategies and performance of family owned supermarkets in Machakos County, Kenya. International Academic Journal of Human Resource and Business Administration, 3(3), 31-51.
Mwenda, G. (2020). Strategic orientation and organization growth: A review. International Academic Journal of Human Resource and Business Administration, 3(8), 133-142.
Narula, S., Rana, S., Srivastava, S., & Kharub, M. (2021). Improving firm performance using market orientation and capabilities: a case study approach. South Asian Journal of Business Studies. https://doi.org/10.1108/SAJBS-10-2021-0375
Pantano, E., Pizzi, G., Scarpi, D., & Dennis, C. (2020). Competing during a pandemic? Retailers’ ups and downs during the COVID-19 outbreak. Journal of Business Research, 116, 209-213. https://doi.org/10.1016/j.jbusres.2020.05.036
Porter, M. E. (1985). Competitive Advantage. Free Press.
Porter, M. E. (2008). Competitive Advantage: Creating and Sustaining Superior Performance by
Porter, M. E. (2008). The Five Competitive Forces that Shape Strategy. Harvard Business Review, 86(1), 79 – 93.
Sharma, M., Luthra, S., Joshi, S., & Kumar, A. (2021). Accelerating retail supply chain performance against pandemic disruption: adopting resilient strategies to mitigate the long-term effects. Journal of Enterprise Information Management. https://doi.org/10.1108/JEIM-07-2020-0286
Spinelli, G., Nelson-Becker, H., & Ligossi, R. (2019). Consumer Competence Strategies, Spiritually Inspired Core Values and Locus of Control: What Are the Links?. Sustainability, 11(17), 4787. https://doi.org/10.3390/su11174787
Stead, J. G., & Stead, W. E. (2019). Why Porter is not enough: economic foundations of sustainable strategic management. In Rethinking strategic management (pp. 67-85). Springer, Cham. https://doi.org/10.1007/978-3-030-06014-5_4
Wang, C. H., Chen, K. Y., and Chen, S. C. (2013). Total Quality Management, Market Orientation and Hotel Performance: The Moderating Effects of External Environmental Factors. International Journal of Hospitality Management, 31(1), 119-129. https://doi.org/10.1016/j.ijhm.2011.03.013
Downloads
Published
2022-11-07
How to Cite
Kairu, H. N., & Kibe, L. W. (2022). Analysis of Product Differentiation on the Performance of Supermarkets in Nairobi City County, Kenya. Journal of Strategic Management, 6(6), 97–111. https://doi.org/10.53819/81018102t6044
Issue
Section
Articles
