Customer Acquisition Strategy and the Performance of Roofing Sheet Manufacturers in Kenya

Abstract

Over the past decade, there has been a consistent and concerning decline in the production and consumption of locally manufactured roofing sheets, resulting in a substantial reduction in both revenue and employment within the industry. Notably, Kenya's roofing sheet production experienced a decline exceeding 8 percent in 2019, marking the culmination of a downward trend that was initiated by a weakened demand in 2010. This protracted slump has raised critical questions about the sustainability and competitiveness of the domestic roofing sheet manufacturing sector. Customer acquisition strategy prescribes a path to positively sustaining performance by shifting firms from cut-throat market competition (the red ocean) to a wide-open new uncontested market space (the blue ocean). It argues that operating in "cutthroat and saturated markets" results in a "red ocean of rivals fighting over a shrinking profit pool." The main purpose of this study was to establish the effect of customer acquisition strategy on the performance of roofing sheet manufacturers in Kenya. The study adopted a mixed research method and employed a descriptive research design. The target population consisted of 241 employees drawn from all the fifteen (15) roofing sheet manufacturers in Kenya registered with the Kenya Association of Manufactures (KAM), from whom a sample size of one hundred and twenty-seven (127) employees was selected using the Krejcie and Morgan table formula. The findings of this study have illuminated a statistically significant positive effect of customer acquisition on firm performance, as evidenced by R-squared values of 0.623 (62.3%), with p-value of 0.00, way below the significance threshold of 0.05. The statistics imply that 62.3% of the variance in the performance of roofing sheet manufacturers can be attributed to the adoption of the customer acquisition strategy. Consequently, the study recommends that roofing sheet manufacturers must prioritize the adoption of need-based customer acquisition to ensure sustainable performance.

Keywords: Customer acquisition, firm performance, and blue ocean

DOI: 10.7176/EJBM/16-2-08

Publication date:March 31^st 2024