STRATEGIC MARKETING INNOVATIONS AND FIRM PERFORMANCE AMONG FAST MOVING CONSUMER GOODS FIRMS IN NAIROBI CITY COUNTY, KENYA
Pauline Wawira Kinyua - MBA Candidate (Strategic Management and Marketing), Department of Commerce School of Business and Economics, Daystar University, Kenya
Charles Katua Kithandi (MBA, MSc, CPA(K)) - Lecturer, Department of Commerce, School of Business and Economics, Daystar University, Kenya
Dr. Sylvia Ng'ang'a (PhD) - Lecturer, Department of Commerce, School of Business and Economics, Daystar University, Kenya
ABSTRACT
The Fast-Moving Consumer Goods (FMCG) sector in Kenya faces declining market performance of well-known brands, thin margins and intense competition from formal and informal players, while traditional price-led promotions and mass-media advertising are proving inadequate for an increasingly digital consumer. The purpose of this study was to assess the effect of strategic marketing innovations on the firm performance of FMCG firms in Nairobi City County, Kenya, and the moderating effect of market turbulence on this relationship. Strategic marketing innovation was operationalized as product, market, price and promotional innovation, firm performance as customer base and market operational efficiency, and market turbulence as competitive intensity and technological shifts. The study was anchored on Dynamic Capabilities Theory, supported by the Resource-Based View, Diffusion of Innovation Theory and Contingency Theory. A positivist philosophy and a cross-sectional descriptive and correlational research design were adopted. A census of 97 FMCG manufacturing, distribution and retail firms was conducted, targeting the heads of marketing, operations, finance and ICT in each firm (388 respondents), of whom 303 (78%) returned usable questionnaires. Data were analyzed using descriptive statistics, Spearman rank correlation, simple and multiple regression and moderated regression analysis in SPSS. Product innovation (β = 0.726, R² = 0.526), market innovation (β = 0.742, R² = 0.550), price innovation (β = 0.676, R² = 0.457) and promotional innovation (β = 0.792, R² = 0.627) each had a positive and significant effect on firm performance (p < .001), and jointly explained 67.4% of the variance in firm performance, with promotional innovation the strongest and price innovation the weakest predictor. Competitive intensity (β = 0.168, p < .001) and technological shifts (β = 0.132, p = .002) positively and significantly moderated the relationship between strategic marketing innovation and firm performance. All five null hypotheses were rejected. The study recommends that FMCG firms adopt an integrated portfolio of marketing innovations that prioritizes digital promotion, invest in digital and dynamic capabilities, and treat market turbulence as an opportunity for innovation.