influence of promotional campaigns on adoption of mobile money payment platforms a case study ...

113 Pages·2015·1.58 MB·English

INFLUENCE OF PROMOTIONAL CAMPAIGNS ON ADOPTION OF
MOBILE MONEY PAYMENT PLATFORMS

A CASE STUDY OF LIQUOR RETAILERS IN KENYA

BY
MESHACK AKOKO OTIENO

UNITED STATES INTERNATIONAL UNIVERSITY
AFRICA

SUMMER 2015
INFLUENCE OF PROMOTIONAL CAMPAIGNS ON ADOPTION OF
MOBILE MONEY PAYMENT PLATFORMS

A CASE STUDY OF LIQUOR RETAILERS IN KENYA

BY
MESHACK AKOKO OTIENO

A Project Report Submitted to the Chandaria School of Business in Partial
Fulfillment of the Requirement for the Degree of Masters in Business
Administration (MBA)

UNITED STATES INTERNATIONAL UNIVERSITY
AFRICA

SUMMER 2015

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STUDENTS DECLARATION

I, the undersigned, declare that this is my original work and has not been submitted to any
other college, institution or university other than the United States International University
for academic credit

SIGNED: _________________________ DATE: _____________________
Meshack Otieno Akoko (628738)

This report has been presented for examination with my approval as the appointed
supervisor.

SIGNED: _________________________ DATE: _____________________
Dr. Peter Kiriri

SIGNED: _________________________ DATE: _____________________
Dean, Chandaria School of Business

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ACKNOWLEDGEMENTS

I acknowledge the support, guidance and encouragement of my supervisor, Dr. Peter Kiriri.
Thank you for your insights and incredible input which guided me throughout the whole
process of coming up with this project report. I also recognize and thank the liquor merchants
in Kasarani Sub County who took their time off their busy schedules to complete the
questionnaires and provide insights into their business.

Special thanks goes to my research assistants, Ken, Agnes and Mercyline for their dedication
in ensuring successful administration of the questionnaires. Finally, I appreciate my fiancée
Winnie for standing with me and providing support. I love you and you add value to my life.
Above all, I thank the Almighty God, our creator and the father of our Lord and Savior Jesus
Christ. To all that I have, I owe it to God.

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DEDICATION

To my unborn child, a hope for the future. The joy of anticipation. And a generation and
legacy so secure. To God be the Glory.

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COPYRIGHT

© 2015
Meshack Akoko Otieno
All rights reserved.
This material can be used for scholarly purposes. Any commercial use of whatever kind is
prohibited without express authorization of the owner.

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ABSTRACT

The purpose of this study was to investigate the influence of promotional campaigns on
adoption of mobile money payment platforms by liquor retailers in Kenya, with specific
focus on outlets in Kasarani Sub County, Nairobi. The specific research questions were:
What is the influence of Promotional Media on Adoption?; Do Promotional Messages
Influence Adoption?; What is the influence of Promotional Benefits on Adoption; and, How
does Promotional Frequency Influence Adoption?

Descriptive research design was used for the study, focusing on liquor retailers within
Kasarani Sub County. The Sub County was further divided into five wards namely: Njiru,
Mwiki, Kasarani, Ruai and Clay City. The geographical demarcation of these wards allowed
for cluster sampling. The population under study was 266 liquor merchants out of which a
total of 77 respondents were interviewed. Data was collected using questionnaires developed
by the researcher and administered by research assistants through personal interviews and
self-administration. Data obtained was analyzed using SPSS to output descriptive and
inferential statistics and presented using percentages and significance levels. Binary
regression analysis was used to generate the variables which strongly predicted adoption of
mobile money payment platforms. Results were presented in tables, charts and figures.

The study revealed that the liquor retail business is dominated by men and the youth, with
men constituting 61% of the sampled population, and the youth, categorized as age group
between 18-35 constituting 78% percent of the sample. It was also noted that many liquor
outlets were based in densely populated areas such as Kasarani and Mwiki constituencies
indicating that liquor merchants prefer to set their business closer to residential areas for ease
of access as opposed to drive-in areas such as Clay City with a relatively scarce population.

On effect of adoption of mobile payments, it was established that the working duration at the
liquor retail outlets and the relationship to the business had the most significant influence on
adoption of mobile money payments. It’s important to note that majority of the respondents
at 62% had only worked for less than two years, which is within the duration that Safaricom
(2004) launched what was effectively a mobile money wallet that enables merchant
payments, the first of its kind in Kenya.

The study revealed that exposure and interaction with different promotional vehicles can
influence adoption of mobile money payments. Particularly, interactions with radio and
internet campaigns had the strongest influence in predicting adoption. Billboards had the
highest significance as a source of information that can influence adoption. Also rated highly
were bar storms and visits by mobile money providers’ sales team. Retailers also preferred to
get information from magazines, even though there was weak evidence of any level of
interaction with magazines.

It was also established that messages which directly compared competitive platforms,
delivered through animated characters, demonstrated how the solution works and showed
evidence of benefits were the most significant in influencing adoption. Further, the promise
of increased sales during promotions had the most significant influence on adoption.
Retailers also preferred instant prizes to customers, direct incentives for themselves and a
promise of increased number of patrons at the outlets.

Finally, the study found out that the majority of liquor retailers preferred promotions to run
quarterly and would switch providers in favor of the competitor who frequently run
promotional campaigns. The variable that most significantly influenced adoption of mobile
money was frequent promotions which reminded the retailers of the benefits of mobile
payments.

The study concludes that exposure and interaction with different promotional vehicles can
influence adoption of mobile money payments. Particularly, interactions with radio and
internet campaigns have the strongest influence in predicting adoption. In addition, messages
which directly compare competitive platforms, delivered through animated characters,
demonstrates how the solution works and shows evidence of benefits are the most significant
in influencing adoption.
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Further, the promise of more sales during promotions has the most significant influence on
adoption. Retailers also prefer instant prizes to customers, direct incentives for their
businesses and a promise of more patrons to the outlets during promotional campaigns. On
the other hand, loyalty benefits, using promotions as a trigger for first experience and to
bring closer relationship between merchants and suppliers have no significant influence in
predicting adoption. Finally, the study concludes that the majority of liquor retailers prefer
promotions to run quarterly and can switch providers in favor of the competitor who
consistently run promotional campaigns.

The study recommends that mobile money service providers should direct their promotional
messages through billboards in high traffic areas and engage in more sales visits and
barnstorms. The providers should adopt a more aggressive approach in their promotional
messaging and directly compare their offering to competing products. Further pull and push
promotions should both be employed, with focus on increasing sales within the duration of
the promotions. The promotions should include direct incentives to both customers and to the
business, while driving more traffic to the outlets.

In addition, mobile money service providers should be more aggressive in running
promotions that directly compare competing mobile payment platforms. Repeated exposures
to promotional messages should also remind the merchants on the benefits that the mobile
payment platform brings to their businesses. Finally, the study recommends that further
studies should focus on the impact of promotions on the bottom-line for the business.
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TABLE OF CONTENTS

STUDENTS DECLARATION ............................................................................................. iii
ACKNOWLEDGEMENTS .................................................................................................. iv
DEDICATION......................................................................................................................... v
COPYRIGHT ......................................................................................................................... vi
ABSTRACT .............................................................................................................................. i
LIST OF ABBREVIATIONS ............................................................................................... vi
LIST OF TABLES ................................................................................................................ vii
LIST OF FIGURES ............................................................................................................. viii

CHAPTER ONE ..................................................................................................................... 1
1.0 INTRODUCTION.......................................................................................................... 1
1.1 Background of the Problem ............................................................................................. 1
1.2 Statement of the Problem ................................................................................................. 6
1.3 Purpose of the Study ........................................................................................................ 7
1.4 Research Questions .......................................................................................................... 8
1.5 Significance of the Study ................................................................................................. 8
1.6 Scope of the Study ........................................................................................................... 9
1.7 Definition of Terms........................................................................................................ 10
1.8 Chapter Summary .......................................................................................................... 12

CHAPTER TWO .................................................................................................................. 13
2.0 LITERATURE REVIEW ........................................................................................... 13
2.1 Introduction .................................................................................................................... 13
2.2 Influence of Promotional Media on Adoption ............................................................... 13
2.3 Influence of Promotional Messages on Adoption .......................................................... 19
2.4 Influence of Promotional Benefits on Adoption ............................................................ 24
2.5 Influence of Promotional Frequency on Adoption ........................................................ 31
2.6 Chapter Summary .......................................................................................................... 35
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