ABSTRACT
Kenya has been slow in adjusting to the external hospitality environment and adopting
competitive marketing strategies as evidenced by the higher growth of tourism in competitor
countries. Marketing models such as the four P’s which were developed for monopolies
within the manufacturing industries of developed countries and overlook modern consumer
trends such as guests’ experiences are however being used by hotels in Kenya which operate
in a monopolistic and perfectly competitive service oriented industry. This study therefore
examined marketing models for performance among four and five star hotels in Kenya. The
specific research objectives were to; examine factors which influence the guests’ purchase
decisions, establish the hotels’ marketing strategies, assess guests’ and managers’ perceptions
on the marketing strategies, develop a marketing model for the hotels, establish the direct
effects in the relationship between the new marketing strategies and performance and the
mediating roles of customer and market performance in the relationship between the new
marketing strategies and financial performance. The study adopted the contingency theory
and applied the mixed sequential exploratory research design. The study population
comprised of managers and customers in hotels. Hotels in Nairobi and Mombasa were
selected using cluster sampling. The guests who were interviewed (n=26) and those who
filled in self-administered questionnaires (n=198) were selected using convenience sampling.
Managers who preferred to complete self-administered questionnaires (n=102) or talk freely
of their marketing activities through semi-structured interviews (n=9) were conveniently
sampled. Data was analysed using descriptive, thematic, content, narrative and gap analysis
and structural equation modeling. The findings showed that the guests’ purchase decisions
depended on their perceptions of the marketing strategies; the hotels focused on promotions
and their customers and there were gaps in managers’ and guests’ perceptions of the
marketing strategies. A new marketing model which mapped the product, ambience,
hospitality, service, destination, value and communication strategies was therefore developed
and validated after confirming its validity, reliability and predictive relevance. The R2 for
cash inflow was .58, profits .78 and return on investment .65. Thus the guests’ perceptions of
the marketing strategies influenced their purchase decisions although the hotels embraced a
narrow range of marketing strategies which could be improved. The study concluded that the
factors which influence the guests’ purchase decisions are the atmosphere, food, facilities,
amenities, hospitality, location, accessibility, price, value, discounts and security; the hotels
employ customer relationship management and promotions; the guests and managers have
positive and negative perceptions of the marketing strategies; a new marketing model which
addresses guests’ experiences can be adopted; the new marketing strategies directly,
positively and negatively influence performance and that customer performance and market
performance partially, indirectly or fully mediate the relationship between the new marketing
strategies and financial performance. The hotels should therefore involve guests in
developing their products and experiences; embrace a broader range of modern marketing
strategies; close the gaps in managers’ and guests’ perceptions of the marketing strategies;
adopt the new marketing model and take advantage of the effects of the marketing strategies
on performance.