THE EFFECT OF MARKETING MIX ON PERFORMANCE OF FINANCIAL SERVICES IN RWANDAA CASE STUDY OF BANK OF KIGALI MAIN BRANCH

INDEPENDENT INSTITUTE OF LAY ADVENTISTS OF KIGALI (INILAK)

FACULTY OF ECONOMIC SCIENCES AND MANAGEMENT

DEPARTMENT OF MARKETING

ACADEMIC YEAR 2012

P.O.BOX 6392 KIGALI

Submitted by

Emelyne UMUTONI

Supervisor:

Mr. Vedaste BUTERA

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Dissertation submitted to the Faculty of

Economic Sciences in partial fulfillment of the

requirements for the award of the Bachelor’s

Degree in Marketing

Kigali, August, 2012

DECLARATION

I. Emelyne UMUTONI, hereby declare that, to the best of my

knowledge, the work presented in this research project entitled

“THE EFFECT OF MARKETING MIX ON PERFORMANCE OF FINANCIAL SERVICES IN

RWANDA” was conducted with reference to BANK OF KIGALI (BK) as

case study is my original work. It has never been presented

anywhere or any other institution of higher learning.

Where other individuals work has been used, references have been

indicated. Sometimes quotations have been used and the research

is ended with a detailed bibliography.

Signature

Emelyne UMUTONI

Date ……../……../2012

2

CERTIFICATE

This is to certify that this research project entitled “THE EFFECT

OF MARKETING MIX ON PERFORMANCE OF FINANCIAL SERVICES IN RWANDA” was

conducted with reference to BANK OF KIGALI (BK) as case study, is

the original work completed by Emelyne UMUTONI, in partial

fulfillment of the requirements for the award of a Bachelor’s

degree in Marketing in Independent institute of Lay Adventists of

Kigali (INILAK) during academic year 2012, under my supervision

and guidance.

Signature………………………….

Date………../……..…/2012

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Supervisor: Mr. Vedaste BUTERA

DEDICATION

To my GOD, to my family and friends, to whom I owe so much.

I extend my special thanks to my mother, brother and sisters who

gave me all possible supports to carry out my studies.

To all that I love so much.

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I dedicate this report.

ACKNOLEDGEMENT

The present work is a contribution from many people to whom I

really have to thank.

Deepest appreciation goes to my supervisor Mr. Vedaste BUTERA for

his able and tireless supervision of this research work, the

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management of BK and the clients whose response enabled this

research have first-hand data.

I also wish to acknowledge with gratitude and indebtedness the

contribution of my Mother, my brothers and sisters and whoever

helped towards this research, I consider his patience and his

encouragement.

My special thanks go to INILAK administration and to all my

lecturers in the Faculty of Economic Sciences who provided me

with valuable knowledge and supportive education.

Gratitude is also owed to my friends such as UWIZEYE Cynthia,

NYIRAKARAGWE Nadia, MUNYANA Floride, and classmates who

contributed in one way or the other towards the success of this

research. I cannot forget your support.

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ABSTRACT

This study has assessed the effect of marketing mix on

performance of financial services in Rwanda and the main

objective was to examine the effect of marketing mix to

performance of Bank of Kigali. Then using structured

questionnaires, survey data were collected in August, 2011 data

was analyzed by using SPSS (soft package for social sciences).

Then the findings showed that: on the side of satisfaction of the

customers of Bank of Kigali, the rate goes at 93.3%, pricing

perception is average as 33.3% of customers found the cost of

Bank of Kigali services not high; the findings revealed also that

Bank of Kigali has put much emphasis in facilitating customers to

access to its services as long as 88.9% of respondents use to

access very easy and easily the services of Bank of Kigali. On

promotion side 44.4% of respondents experienced more than one way

of getting the information about the services of Bank of Kigali

while the time for customer to wait in order to be serviced has

been found reasonable as 55.5 % of respondents said that they get

served within 5 minutes (6-10 min) and 20 minutes (11-30 min).

In terms of marketing performance, Bank of Kigali has an

outstanding pattern of professionalism that led in financial

success. In fact, the findings have shown that from 2007 up to

2011Bank of Kigali has realized an increase of total asset by7

24.1%, increase of customers ‘deposit of 15.5%, the profit after

tax of 19.5% and the number of branches increased from 11 in 2007

up to 44 in 2011. Finally, the net profit has increased by 40.6%.

Key words: Marketing mix, performance.

LIST OF ABBREVIATIONS

BK: Bank of Kigali

ATM: Automated tera machine

INILAK: Independent Institute of Lay Advantist of Kigali

R&D: Research and development

RM: Relationship Marketing

4PS: Product, Price, Place and Promotion

TSR: Total Share Return

P/E: Price-Earnings ratio

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P/B: Price-to-Book value

CDS: Credit Default Swap

POSs: Points of Sales

CUP: China Union Pay

SPSS: Statistical Package for the Social Sciences

KPIs: Key Performance Indicators

LIST OF TABLES

Table 4-1: Gender aspect of respondents

Table 4-2: Ages aspect of respondents

Table 4-3: Academic level aspect

Table 4-4: the use of services of Bank of Kigali

Table 4-5: Customers’ appreciation on Bank of Kigali services

Table 4-6: Customers ‘perception on the cost of services of BK

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Table 4-7: Customers’ perception on the accessibility of service

of Bank of Kigali

Table 4-8: Customers ‘perception on waiting time in order to get

served

Table 4-7: Customers ‘perception on promotion strategy of Bank of

Kigali

Table 4-10: Performance indicators of Bank of Kigali

TABLE OF CONTENTS

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DECLARATION..........................................................2

CERTIFICATE..........................................................3

DEDICATION...........................................................4

ACKNOLEDGEMENT.......................................................5

ABSTRACT.............................................................6

LIST OF ABBREVIATIONS................................................7

LIST OF TABLES.......................................................8

TABLE OF CONTENTS....................................................9

CHAPTER ONE: INTRODUCTION...........................................13

1.1 BACKGROUND OF THE STUDY.......................................13

1.2 STATEMENT OF PROBLEM..........................................151.3 OBJECTIVES OF THE STUDY.......................................15

1.4 SCOPE OF THE STUDY............................................161.5 SIGNIFICANCE OF THE STUDY.....................................16

1.5.1 TO THE BANK MANAGERS AND POLICY MAKERS....................161.5.2 TO THE INSTITUTE OF INILAK................................17

1.5.3 TO PUBLIC.................................................171.6 STRUCTURE OF RESEARCH.........................................17

CHAPTER TWO: LITERATURE RIVIEW......................................19

2.1 DEFINITION OF KEY CONCEPTS.....................................19

2.2 THEORY OF MARKETING MIX........................................202.2.1. OVERVIEW OF MARKETING.....................................20

2.2.2 MARKETING MIX..............................................212.2.3. USING THE 4P’s OF MARKETING MIX MODEL.....................21

2.2.4. OBJECTIVES AND IMPORTANCE OF MARKETING MIX................222.3 THEORY OF PERFORMANCE..........................................23

2.3.1. AN OVERVIEW OF PERFORMANCE MEASURES FOR FINANCIAL INSTITUTIONS.....................................................23

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2.3.1.1. FINANCIAL MEASURES...........................................232.4 MARKETING AND PERFORMANCE OF BANK OF KIGALI....................25

2.5 PRELIMINARY CONCLUSION.........................................26CHAPTER THREE: RESEARCH METHODOLOGY.................................28

3.1. QUALITATIVE RESEARCH..........................................283.2. RESEARCH DESIGN...............................................28

3.3. AREA OF THE STUDY.............................................293.4 STUDY POPULATION...............................................29

3.5 SAMPLING METHOD................................................293.6 SAMPLE SIZE....................................................30

3.7. SAMPLE SELECTION..............................................303.8. PURPOSIVE AND RANDOM SAMPLING TECHNIQUES......................31

3.9. SOURCE OF DATA................................................313.9.1. PRIMARY DATA..............................................31

3.10. QUESTIONNAIRE................................................313.11. DATA PROCESSING..............................................32

3.12. EDITING......................................................323.13. CODING.......................................................32

3.14. TABULATION...................................................333.15. LIMITATION OF THE STUDY......................................33

3.16. PROFILE OF BANK OF KIGALI (BK)...............................33CHAPTER FOUR: RESULTS AND DISCUSSION................................35

4.1. SYSTEMATIC PRESENTATION OF DATA...............................354.1.1. SOCIO-DEMOGRAPHIC PROFILE OF CUSTOMERS....................35

4.1.1.2. Age aspect...................................................364.1.1.3. Academic level aspect...........................................37

4.1.2 MARKETING MIX PERCEIVED BY CUSTOMERS IN BANK OF KIGALI.......374.1.2.3 Customers ‘perception on the cost of Bank of Kigali services................38

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4.1.2.4 Accessibility of Bank of Kigali......................................394.1.2.8 Promptness of Bank of Kigali services................................40

4.1.2.5 Promotion strategy of Bank of Kigali.................................404.1.3 MARKETING MIX AND PERFORMANCE PERCEPTION OF BANK OF KIGALI...41

4.1.3.1. The state of marketing at Bank of Kigali................................414.1.3.2. Performance indicators of Bank of Kigali.............................42

4.2 DISCUSSION, ANALYSIS AND INTERPRETATION OF THE DATA............43CHAPTER FIVE: CONCLUSION AND RECOMMANDATIONS........................44

SUMMARY OF THE FINDINGS............................................445.2 RECOMMANDATIONS................................................45

References..........................................................45

Appendices..........................................................49

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CHAPTER ONE: INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Today, business environment is characterized by increased

competition. This is out of the rapid changing technology and

economic liberalization. In the process, new laws and managed

trade policies for customer awareness are continuously coming up.

It is on this basis therefore, that companies need to review

their business missions and strategies. This will save them

operating in close market place thus positioning their Banking

for the better service delivery to their customers (Varma,2004:14).

For business to consumer, marketing is "the process by which

companies/Banks create value for customers and build strong

customer relationship, in order to capture value from customers

in return". For business to business marketing creates value,

solutions, and relationships either short term or long term with

a company or Banks. It generates the strategy that underlies

sales techniques, business communication, and business

developments. It is an integrated process through which

companies/Banks build strong customer relationships and creates

value for their customers and for themselves (Varma, 2004:14).

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Marketing mix helps the financial services to determine the

target market segments, positioning market mix and allocation of

resources. As competition continues to grow in the financial

services industry, financial institutions that develop

comprehensive marketing strategies will be more likely to draw in

clients and differentiates themselves from their competitors.

All this aimed at the successful creation of customer, focused

value proposition, a cogent reason the target market should buy

the product or service because today customers have choice of

preferences. Unlike the traditional view of marketing where

customer used to accept whatever product or service the seller

presented, today this concept has been replaced by modern

marketing techniques which overwhelmingly target satisfying

customers needs which is the management process responsible for

identifying, anticipating customer requirement profitability

(Jefkins 1993:2).

According to Varma (2004:14), marketing refers to total system

interacting business activities designed to plan, price, promote,

and distribute wants satisfying products and services to present

and potential customer.

The marketing mix referred as 4-P’s since the most important

elements of marketing are concerned with:

Product -the product (or service) that customers obtain

Price - how much the customer pays for the product?15

Place - how the product is distributed to the customer

Promotion - how the customer is found and persuaded to buy

the product. (Tailor, 1996:70)

It is known a mix because each ingredient affect other and the

mix must overall be suitable to the target customer.

Companies therefore cannot survive by simply doing a good job,

they must do an excellent job if they are to survive and succeed

in this increasingly competitive global market place. In order to

have a proper grip of the market today, it requires a blend of

marketing mix which give the company a breakthrough in order to

harmonize, adapt to and cop up with ever increasing competition

and changing customer tastes and ability to purchase or

consume .this can be achieved when there are some set of

standards of how those marketing mix ought to be put into

practice (Varma, 2004:14).

According to Robbins (1999:32), performance refers to employee’s

productivity at the work place in other term it refers to the

effective accomplishment of tasks assigned in the most desirable

way in relation to standards, whereas performance refers to

accomplishment of a given task measured against present standards

of accuracy.

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1.2 STATEMENT OF PROBLEM

Financial services are important to any civilized and growing

economy for example banking industry. Since 1994, Rwanda, has

embraced financial services which industry has been growing

steadily over the last few years. The growth of the banking

industry has been realized in some of the firms operating in

Rwanda based on the forces of demand and supply of such services

on the Rwanda market, the high performing human resource of

financial services and most importantly because of employing

violent marketing mix for improved service delivery to customers.

However, there has been some slow growth, stagnation and poor

performance of some financial institutions in banking industry

which has resulted in poor customer maintenance and this has led

many customers shift from one bank to another in search of better

service delivery.

It is therefore the reason why the researcher is interested to

investigate whether marketing mix has performance effects on

financial institution services in Rwanda with a case study of

Bank of Kigali Rwanda.

1.3 OBJECTIVES OF THE STUDY

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1.3.1 GENERAL OBJECTIVES

General objective is to examine the effect of marketing mix to

performance of Bank of Kigali Rwanda.

1.3.2 SPECIFIC OBJECTIVES ARE:

1. To find out whether marketing mix of Bank of Kigali has

performance effect on its service delivery to its

customers.

2. To examine the performance effect of marketing mix on

Bank of Kigali towards its customer service delivery.

3. To determine the contribution of marketing mix and its

performance effect on Bank of Kigali towards its

customers.

1.3.3 RESEARCH QUESTIONS ARE:

1. Does marketing mix of BK have an effect on its performance?

2. What are the challenges of marketing mix to its performance

in BK as one of the financial service in Rwanda?

3. What are the benefits of marketing mix to the development

of BK?

1.4 SCOPE OF THE STUDY

Since there are so many financial institutions most especially

commercial banking in Rwanda, the Bank of Kigali has been18

selected to represent the rest of other financial institution in

Rwanda and has been selected randomly. The case study has been

carried out at the Bank of Kigali BK main branch, in Kigali city.

The study is focusing in the effect of marketing mix on

performance financial service in Rwanda. The time frame Work for

this academic research project work was for three years from

2008-2011. The participants should conduct through in-depth

interviews which would take at least between 20 to 25 minutes per

interviewee.

1.5 SIGNIFICANCE OF THE STUDY

1.5.1 TO THE BANK MANAGERS AND POLICY MAKERS

The study aims at helping the policy makers and the bank’s

shareholders to get means and the general ideas about the effect

of marketing mix on performance financial service in Rwanda and

ways of controlling marketing resources of the bank, so as to

increase on the percentage customer care services especially in

financial companies.

1.5.2 TO THE INSTITUTE OF INILAK

INILAK as an institution of higher learning, its community most

especially department of marketing will get picture of how much

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the financial service sector of Rwanda. On the site of other

researchers who will be interested in this area of study can use

this research results, literature and methodology for the purpose

of acquiring information and practical knowledge on how the

commercial banking has played a big on effect of marketing mix on

performance financial service in Rwanda, and it adds the

literature to the existing library of INILAK.

1.5.3 TO PUBLIC

The report of this study shall serve as basis and guide for

future reference by other researchers and other academic

references. The study will assist other people especially

students, financial service on how they can improve their

performance. It will assists other people to develop competent

skills by referring to other research works done and hence more

knowledge to people and the country at large.

1.6 STRUCTURE OF RESEARCH

This research work is mainly divided into five chapters.

Chapter one presents the general introduction of the study, back

ground of the study, statement of the problems, study objectives

scope, significant of the study and organization of the research

project.

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Chapter two constitutes of the literature and definition of key

terms and concepts used in research.

Chapter three also constitutes the research methodology

“Qualitative” used and include the introduction, the population

sampling and size, sample characteristics and data collection

methods and data analysis, and the problem encountered during the

research process.

Chapter four includes findings, interpretation and presentation

of the findings gathered throughout the research.

Finally chapter five constitutes summary findings, conclusions,

recommendation and gender or area of further studies.

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CHAPTER TWO: LITERATURE RIVIEW

Over the last period of years there has been considerable

theoretical and empirical work conducted on marketing mix

(McCarthy 1960:14). So, in this work on the effect of marketing

mix on performance of financial services in Rwanda, the

researcher relayed on some theories and concepts that have been

found in the over said empirical and theoretical work. Then,

the present chapter starts by introducing key concepts and

theories on marketing mix and performance.

2.1 DEFINITION OF KEY CONCEPTSMarket

McCarthy (1960:14) has defined a market as any place where the

sellers of a particular good or service can meet with the buyers

of that goods and service where there is a potential for a

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transaction to take place. The buyers must have something they

can offer in exchange for there to be a potential transaction.

Marketing

The term marketing has evolved over time; today marketing is

based around providing continual benefits to the customer

following a transactional exchange. The Chartered Institute of

Marketing defines marketing as 'The management process

responsible for identifying, anticipating and satisfying customer

requirements profitably (McCarthy, 1960:14).

According to Tailor (1996:70), marketing is satisfying needs and

wants of a customer through an exchange process. Tailor (1996:70)

continues saying that customers will only undertake the exchange,

if they feel that their needs are being satisfied, clearly the

transactional value cannot be more than the amount customers are

prepared to pay to satisfy their need.

Marketing mix

According to McCarthy (1960:14), for business to consumer

marketing, marketing mix is "the process by which companies

create value for customers and build strong customer

relationships, in order to capture value from customers in

return". Also, for business to business marketing, for business

to business marketing it is creating value, solutions, and

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relationships either short term or long term with a company or

brand.

Moreover, McCarthy (1960:17) stated that marketing mix is a

business tool used in marketing products. The marketing mix is

often crucial when determining a product or brand's unique

selling point (the unique quality that differentiates a product

from its competitors), and is often synonymous with the four Ps:

price, product, promotion, and place. The term marketing concept

holds that achieving organizational goals depends on knowing the

needs and wants of target markets and delivering the desired

satisfactions. It proposes that in order to satisfy its

organizational objectives, an organization should anticipate the

needs and wants of consumers and satisfy these more effectively

than competitor. Simply say, Marketing Mix is the combination offour elements, called the 4P’s (Product, Price, Promotion and Place),

that every company has the option of adding, subtracting, or modifying

in order to create a desired marketing strategy.

Performance

According to Campbell et al., (1993:40), performance is what the

organization hires one to do, and do well”, while Wheelen and

Hunger (2002:243) defined performance simply as the end result of

activity.

2.2 THEORY OF MARKETING MIX

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2.2.1. OVERVIEW OF MARKETING

Marketing is a set of activities by which the demand for goods,

ideas, and services is managed to facilitate exchange (Markin,

1982:15). It is a planned strategic approach of bringing together

consumers and products. Thereby, marketing is the process by

which companies create value for customers and build strong

customer relationship in order to capture value from customers in

return (Kotler and Armstrong, 2008:5), in other term marketing is

managing profitable customer relationships. From these

explanations there come the goal of marketing and they are

twofold: attract new customers by promising superior value and to

keep and grow currents customers by delivering satisfaction

(Kotler and Armstrong, 2008:4).

Then for companies to achieve these goals, they have to set

marketing strategies. Perreault and McCarthy (2002:46) defined

marketing strategy as a big picture of what a firm will do in

some market and it involves two pats such as target market and

marketing mix. In other words, marketing strategy specifies the

target and related marketing mix. Therefore, in this study, the

researcher considered the second party of marketing strategy such

as marketing mix for which the researcher found out its the

performance effect in Bank of Kigali as a financial service.

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2.2.2 MARKETING MIX

According to (Kotler and Armstrong, 2008:50), after deciding on

its overall marketing strategy, the company is ready to begin

planning the details of the marketing mix, one of the major

concepts in modern marketing. According to Gerard (2006:506),

the marketing mix refers to variables that a marketing manager

can control to influence a brand’s sales or market share.

Traditionally, these variables are summarized as the four Ps of

marketing: product, price, promotion, and place. Perreault and

McCarthy (2002:46) defined marketing mix as the controllable

variables the company puts together to satisfy the target market.

In this way the target market is surrounded by the controllable

variables that we call marketing mix.

For Perreault and McCarthy (2002:46), a typical marketing mix

includes some product, offered at a price, with some promotion to

tell potential customers about the product, and a way to reach

the customers place. In the same view like Perreault and McCarthy

(2002:46), Kotler and Armstrong, (2008:50) defined marketing mix

as the set of controllable , tactical marketing tools that the

firm blends to produce the response it want in target marketing.

Therefore, the marketing mix consists of everything the firm can

do to influence the demand for its product and many possibilities

can be collected into four groups of variables know as the four

P’s: product, price, place, and promotion. Simply put, the four

P’s are the four elements of marketing strategy.26

2.2.3. USING THE 4P’s OF MARKETING MIX MODEL

According to Gerard (2006:506), the 4P’s are like following:

1. Product: refers to aspects such as the firm’s portfolio of

products, the newness of those products, their

differentiation from competitors, or their superiority to

rivals’ products in terms of quality. As producer-oriented,

product is seen as an item that satisfies what a consumer

needs or wants. It is a tangible good or an intangible

service. Every product is subject to a life-cycle including

a growth phase followed by a maturity phase and finally an

eventual period of decline as sales falls. Marketers must do

careful research on how long the life cycle of the

product /service they are, marketing is likely to be and

focus their attention on different challenges that arise as

the product, service moves through each stage.

2. Promotion: refers to advertising, detailing, or informative

sales promotions such as features and displays. Also,

promotion represents all of the methods of communication

that a marketer may use to provide information to different

parties about the product.

3. Price: refers to the product’s list price or any incentive

sales promotion such as quantity discounts, temporary price

cuts, or deals. In addition, the price is the amount a

customer pays for the product. The price is very important

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as it determines the company's profit and hence, survival.

Adjusting the price has a profound impact marketing

strategy, and depending on the price elasticity of the

product, service often it will affect the demand and sales

as well. The marketer should set a price that complements

the other elements of the marketing mix.

4. Place: refers to delivery of the product measured by

variables such as distribution, availability, and shelf

space.

Thus, marketing mix generates the strategy that underlies sales

techniques, business communication, and business developments. It

is an integrated process through which companies build strong

customer relationships and create value for their customers and

for themselves.

2.2.4. OBJECTIVES AND IMPORTANCE OF MARKETING MIX

The main reasons the marketing mix is a powerful concept are that

it makes marketing seem easy to handle, allows the separation of

marketing from other activities of the firm and the delegation of

marketing tasks to specialists; and the components of the

marketing mix can change a firm’s competitive position (Grönroos,

1994:85). The marketing mix concept also has two important

benefits. First, it is an important tool used to enable one to

see that the marketing manager’s job is, in a large part, a

matter of trading off the benefits of one’s competitive strengths

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in the marketing mix against the benefits of others. The second

benefit of the marketing mix is that it helps to reveal another

dimension of the marketing manager’s job. All managers have to

allocate available resources among various demands, and the

marketing manager will in turn allocate these available resources

among the various competitive devices of the marketing mix. In

doing so, this will help to instill the marketing philosophy in

the organization (Low and Tan, 1995:67).

2.3 THEORY OF PERFORMANCE

Marketing practitioners are under increasing pressure to

demonstrate their contribution to firm performance. According to

Taylor (1990:3), performance is a tool to evaluate its success or

the success of a particular activity in which it is engaged.

Sometimes success is defined in terms of making progress toward

strategic goals, but often success is simply the repeated

achievement of some level of operational goal (for example: zero

defects, 10/10 customer satisfaction).

2.3.1. AN OVERVIEW OF PERFORMANCE MEASURES FOR FINANCIAL

INSTITUTIONS

According to Chong (2008:1) a business organization could measure

its performance using the financial and non-financial measures.

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2.3.1.1. FINANCIAL MEASURES

The financial measures include profit before tax and turnover

(Chong, 2008:1). There is a multitude of measures used to assess

bank performance, with each group of stakeholders having its own

focus of interest. Among the large set of performance measures

for banks used by academics and practitioners alike, a

distinction can be made between traditional, economic and market-

based measures of performance (European Central Bank, 2010:8).

a. Traditional measures of performance

Traditional performance measures are similar to those applied in

other industries, with return

on assets (RoA), return on equity (RoE) or cost-to-income ratio

being the most widely used.

In addition, given the importance of the intermediation function

for banks, net interest margin is typically monitored.

b. Economic measures of performance

The economic measures of performance take into account the

development of shareholder value creation and aim at assessing,

for any given fiscal year, the economic results generated by a

company from its economic assets (as part of its balance sheet).

These measures mainly focus on efficiency as a central element of

performance, but generally have high levels of information

requirements.

c. Market-based measures of performance

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Market-based measures of performance characterize the way the

capital markets value the activity of any given company, compared

with its estimated accounting or economic value. The most

commonly used metrics include:

1) The “total share return” (TSR), the ratio of dividends and

increase of the stock value over the market stock price;

2) The “price-earnings ratio” (P/E), a ratio of the financial

results of the company over its share price;

3) The “price-to-book value” (P/B), which relates the market

value of stockholders’ equity to its book value;

4) The “credit default swap” (CDS), which is the cost of

insuring an unsecured bond of the institution for a given

time period.

2.3.1.2. NON-FINANCIAL MEASURES

According to Chong (2008:6), non-financial measures focus on

issues pertaining to customers’ satisfaction and customers’

referral rates, delivery time, waiting time and employees’

turnover. Chong (2008:6) continues saying that for short term

(less than 12 months) non-financial measures of performance refer

to customers ‘satisfaction and customers ‘referral rate while for

long term within five years non-financial measures of

performance refer to growth in revenue and customer ‘base market.

Then in the case of this study, the researcher has used both

financial measures in term of bank profit and non-financial

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measures such us customers ‘satisfaction, their increase number

and the use of information technology on the side Bank of Kigali.

2.3.2 MARKETING PERFORMANCE MEASUREMENTSAccording to SAS (2009:2), understanding the right metrics for

your organization is vital. SAS suggested solutions that include

standard marketing KPIs that comprise marketing best practices.

Only SAS covers all four areas that are crucial to ensuring

alignment and accountability.

Marketing program metrics provide insights on the efficiency

and effectiveness of your marketing efforts.

Customer metrics look at multiple customer dimensions for

insights on their satisfaction, value, segment migration,

etc.

Business/financial metrics are macro level (sales,

profitability, cost, etc.) and give executives a quick

reading on the marketing’s financial impact.

In addition to this list of SAS about marketing metrics, Buyline

report (2008:6), has point out nine areas that marketing

organizations want to measure:

1) Campaign effectiveness

2) Campaign results

3) Cost/benefit analysis

4) Customer affinity

5) Customer satisfaction

6) Market share (versus competitors)

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7) Mind share (share of awareness)

8) Program or campaign trends

9) Wallet share (share of spending)

2.4 MARKETING AND PERFORMANCE OF BANK OF KIGALI

According to the Bank of Kigali Annual report (2011:7), the

performance of 2011 was exceptionally good. Bank of Kigali

managed to grow its Net Income by 40.6% (compared to the growth

by 30.6% in 2010). Also, according to James Gatera Chief

Executive of Bank of Kigali, this growth was as a result of

continued branch expansion and investments in alternative

delivery channels, strong liquidity position, funding sources and

increased focus on retail banking (Bank of Kigali Annual report,

2011:9).

On marketing side, during 2011 Bank of Kigali has focused on

increasing its product and service offering in both corporate and

retail banking in order to meet the changing needs of its

customers. The biggest achievement was the launch of its mobile

banking service which gives customers the ability to check their

balances and order check books, in addition to purchasing prepaid

electricity, prepaid TV and intra-bank money transfer in addition

to giving customers with account information and daily exchange

rates. In the card business, the Bank started issuing

internationally accepted VISA Electron Debi cards in addition to33

the local branded cards from R-SWITCH and the prepaid ZIPP Card

which is targeted at the lower income earners (Bank of Kigali

Annual report, 2011:10)

Also Bank of Kigali is also responsible for the growth of the

branch infrastructure which has seen the Bank’s branch network

grow from 14 in 2008 to 44 in 2011. In addition, Bank of Kigali

has overseen the supply and demand side of the bank’s human

capital with staff complement of 284 in 2008 and 602 in 2011.

(Bank of Kigali annual report, 2011:25).

In 2011, Bank of Kigali has continued to invest in technological

developments to meet its customer demands and invested in making

its ATMs and Points of Sales (POSs) interoperable with both local

debit cards and international cards. Bank of Kigali ATMs and

Points of Sales (POSs) are able to accept not only R-Switch cards

and VISA Cards but Diners Club and China Union Pay (CUP) cards as

well. Going forward, progress is underway to ensure that they

also start accepting American Express as well (Bank of Kigali

Annual report, 2011:10).

2.5 PRELIMINARY CONCLUSION

Performance measurement and marketing go hand-in-hand (BuyLine

Research 2008:2). As it was stated in previous theories that, the

performance of financial institution is measured by what the34

marketing is concerned about such as customers ‘satisfaction,

profit, increase number of customers, simply put, all the

components of traditional, economic and market-based measures of

performance. Also, the relationship between marketing and

performance is mostly shown in the concept of customer lifetime

value. Normally marketing productivity depends on service boost

which is the concept of “customer lifetime value.” Customer

lifetime value is the net present value of a customer’s current

and future contributions to bank profit. The sum of all

customers’ lifetime values is customer equity. Therefore, a good

marketing mix that leads to the achievement of the objectives of

the company implies simultaneously the performance of that

company.

35

CHAPTER THREE: RESEARCH METHODOLOGY

According to Hessler (1989:30), research methodology is the

science of how to make research decision and it includes the

practice of evaluating the goodness or badness of decisions made

in the course of doing research. Methodology refers to a set of

methods and principles that are used when studying a particular

subjects or doing a particular kind of work. It usually includes

descriptions of the research design, the sample design, data

gathering procedures, and measuring instruments. This chapter

describes the ways in which data were collected and analyzed

using qualitative research techniques.

It deals with the research design and the techniques that were

employed in sampling. It also explains how the collected data

were analyzed and disseminated. 36

3.1. QUALITATIVE RESEARCH

Qualitative research is a type of scientific research. In general

terms, scientific research consists of an investigation that:

seeks answers to a question, systematically uses a predefined set

of procedures to answer the question, collects evidence, produces

findings that were not determined in advance, produces findings

that are applicable beyond the immediate boundaries of the study.

Qualitative research shares theses characteristics. Additionally,

it seeks to understand a given research problem or topic from the

perspective of the local population it involves. Qualitative

research is especially effective in obtaining culturally specific

information about the values, opinions, behaviors, and social

contexts of particular populations.

3.2. RESEARCH DESIGN

According to Grinnell, (1990:279) research design is the entire

process of the study the problem formulation through

dissemination of findings. This term is sometimes used to refer

to graphic representation of the independent and dependent

variables. For the purpose of current study, survey method was

adopted and survey research was chosen due to the fact this was

an exploratory study on the effect of marketing mix on

performance of financial institutions in Rwanda with the case

study of Bank of Kigali.

37

3.3. AREA OF THE STUDY

The study was carried out at headquarter or the main branch of

Bank of Kigali in Kigali City Nyarugenge district, in its

department of Marketing. This financial institution which works

as a commercial bank that promotes investment opportunities in

Rwanda and support a Macro finance program that contributes

marketing mix products in Rwanda.

3.4 STUDY POPULATION

The researcher has conducted the study at Bank of Kigali main

Branch. In the research process, the population was composed by

marketing department personnel of Bank of Kigali and its clients;

all macro entrepreneurs working with Bank of Kigali have been

considered as the total population under study but, most

especially those from marketing department which deals with

marketing mix products. Then we considered the total population

of 800 customers as the average number of the customers that

could attend the Bank daily.

3.5 SAMPLING METHOD

The ideal situation is to obtain information from the entire

population. This would ensure maximum coverage of the people

concerned in this research. But for practical issues it is not

easy to access all the elements of the population that’s why the

38

use of a sample. As sample is a portion or subset of population;

it is a small group that is observed (Ary et al., 2003:163;

Frankfort-Nachmias and Nachmias, 1996:179). This one can be

probabilistic or non-probabilistic. Given that our population is

stratified (not homogenous) and bounded based on the activity our

sample is a random sample where each element of our population

has an equal chance to be selected. Then the sampling techniques

to be used are following:

Sample size: The study will use the formula of Alain BOUCHARD to

get the sample that was investigated, that formula was applied as

follows:

Given No: the sample size for an infinite universe

p: success

q: fail

d: error term

N: The size of the main sample,

For an infinite population (> 1.000.000 individuals), with a

margin of error of 10% with the threshold of α = 0.05, i.e. a

confidence interval of 95%, Z α =1.96

N = No1+No

N   where    

2

2( ) *

oZ p qN

d

                       

In the most unfavorable situation (p=q=1/2), the necessary sample

size to estimate, with a given precision a percentage by the

simple random technique is equal a:39

No=(1.96)2

(10100

)2×0.5×0.5

=96.04≈96

On the opposite, if a Population-mother is defined (< 1.000.000

individuals), to obtain the corrected sample size, we used the

formula appropriate.

N = No1+No

N                   

3.6 SAMPLE SIZE

In this study the sample size was composed by 86 respondents as

it is shown below. Then by using the above formula the sample

size for the case of the researcher is:    N =

96

1+96800

} {¿

=

85.71 ≈86 this corresponds to 100% of total simple size

population.

3.7. SAMPLE SELECTION In the present study, all respondents in the population had equal

chance to be selected in the sample. This was due to the fact the

sample was randomly selected.

3.8. PURPOSIVE AND RANDOM SAMPLING TECHNIQUESPurposive and random sampling techniques was used to provide

relevant information from the field regarding to the effect of

40

marketing mix on performance of financial institutions in Rwanda

of which Bank of Kigali is inclusive.

3.9. SOURCE OF DATA In this research study, the source of data was both primary and

secondary data information on the contributions of commercial

banks, the process and stages of marketing mix performance, such

data were got from books, notebooks, reports, Ministry of finance

and Economic planning, National Bank of Rwanda. Books were also

ready and reports from the library of American Embassy concerning

the literature review on marketing mix.

3.9.1. PRIMARY DATA

It is the data collection by the researchers for their own, when

the researchers collect their own data for the particular purpose

of the research, such data is called primary data. The field data

is being collected to answer specific problems for the study.

Primary data is important when secondary data is not enough to

provide the necessary information. The tools that will be used to

collect information are questionnaires and interviews (Gilbert,

1992:182).

3.9.2. SECONDARY DATA

In secondary data; books, journal reports about Rwanda and Micro

credit were used, website about micro credit and micro finance

were referred too. According to the Business calculations and

statistics, simplified. The secondary data means the data which

41

have already been collected by someone and the record of which is

available in the research papers, magazines journals and other

documents (Salami 1987:11).

3.10. QUESTIONNAIREA questionnaire is an instrument that consists of questions to

which the population of a research area would respond in writing.

They are in two categories: Open-ended and close -ended ones.

Close ended questions are those in which the responses of the

subjects are limited to the stated alternative While the open-

ended questions are designed to permit a free response from the

subjects.

It is strategic because, its cheap, saves time, the respondents

answer freely, no pressure in writing form (Kakooza, 1992:15).

The interview schedule an interview schedule is a guide of a

conversation that a researcher uses to get information from

people.

This technique will be used to complement with the questionnaire.

This is because some people are reluctant to fill the

questionnaires and some respondents on the field do not know how

to read and write (Kakooza, 1992:17).

3.11. DATA PROCESSING Data collected have been analyzed and interpreted in reference to

the established objectives. The result are presented in the form

of tables, data processing refers to the transformation of

42

respondents views into meaningful form and classifying responses

into categories called “codes” it consists of edition the

schedules and coding the responses.

According to Kakinda (1990: 155), when date were being processed

the relevant data to the objectives of the study were considered

and transformed into meaningful information for interpretation

and understanding. This process was done through editing coding

and tabulation.

3.12. EDITING After the data were collected, the exercise of inspection and

editing followed in order to discover items that world be

misunderstood by the respondents to detect gaps and other

weaknesses in the data and collection methods.

Kakinda (1990: 155) defined editing as “the process whereby

errors en completed interview schedule and the mail

questionnaires are identified whenever possible.

3.13. CODING According to Kakinda (1996: 29), coding refers to “the assigning

of editing of a symbol or a number to responses given into

categories for easy manipulation.

According to Kalton (1971: 414), argued that the purpose of

coding in survey is to “classify the answers to questions into

meaningful categories so as to bring out their essential

pattern”. Answers to particular questions were noted leading to

43

coding patterns for which coding frames were based. After the

construction of coding frames, frequencies were made essential

for tabulation.

3.14. TABULATION Tabulation deals with putting data into some kind of statistical

tables showings the number of responses to particular questions.

Tabulation is either by hand (for small sample) or by a computer

(large sample). Tabulation by hand is essentially establishing a

frequency distribution of the codes. The researcher makes the

tallies as he went though the schedules

According to Kakinda (1992: 165), therefore, the finding of this

academic research study will be presented in form of tabulation

since it is convenient in data presentation.

3.15. LIMITATION OF THE STUDY

Language barrier; English to Kinyarwanda translation of

questionnaires for some respondents could not give properly

direct meaning. This took much attention not to change the

meaning intended in research result but interview helped also to

get expected results.

Not all questionnaires returned or completely answered by the

respondents due to their own reasons. This has led in missing 41

questionnaires and the researcher managed to process 45

questionnaires.

44

Also, It was be hard to contact some targeted respondents

particularly, key informants such as top manager, credit analysts

and customer care officers and clients of Bank of Kigali. This is

because they were having other commitments. So this has required

the researcher to make several visits to their offices, premises.

However, the researcher would make sure that appointments are

made and thereafter, the necessary information would be obtained.

3.16. PROFILE OF BANK OF KIGALI (BK)

Bank of Kigali Ltd. is a full services commercial bank. The Bank

offers a wide range of banking products and services, including

personal loans, mortgages; Web based banking, and custody

services.

Mission, Vision & Values

Vision: Bank of Kigali aspires to be the leading provider of most

innovative financial solutions in the region.

45

Mission: The mission of Bank of Kigali is to be the leader in

creating value for our stakeholders by providing the best

financial services to businesses and individual customers,

through motivated and professional staff.

Values: Customer focus, Integrity, Quality and Excellence.

46

CHAPTER FOUR: RESULTS AND DISCUSSION

This chapter presents the findings of the study. It starts by

presenting the socio-demographic characteristics of the sample.

It also presents the perceptions of customers on the four P’s of

marketing mix that are operated by Bank of Kigali main branch. On

the other side this chapter presents the state of marketing mix

at Bank of Kigali and the researcher discussed the relationship

between the state of marketing mix with the service delivery in

terms of performance. In this way, the researcher has find out

the performance effect on the services delivery to the customers

of Bank of Kigali as the results of marketing mix.

Data was collected in the month of August and were analyzed using

the statistical package for the social sciences (SPSS) version

16.0 for windows 7 starter. Tabulations were used to present the

socio-demographic characteristics of customers and the results of

their perception about the services delivered at Bank of Kigali

main branch.

4.1. SYSTEMATIC PRESENTATION OF DATA

4.1.1. SOCIO-DEMOGRAPHIC PROFILE OF CUSTOMERS

A total of eighty six respondents constituted the sample of this

study but the researcher managed to reach forty five respondents.

This sample was randomly selected from a population of 800

customers who were scheduled during the period of data47

collection. The social-demographic profile of respondents is

composed by three aspects such as gender, age and academy level.

4.1.1.1. Gender aspect

The gender aspect of respondent is highlighted in the table 4-1

below.

Table 4-1: Gender aspect of respondents

Frequency PercentFemale 24 53.3%Male 21 46.7%Total 45 100%

Source: Primary dataAs it is seen in this table, 53.3% of respondents were female

while 46.7% were male. So, in this case the researcher found

that women have a positive adhesion in using bank services than

it was in old time.

4.1.1.2. Age aspect

Regarding the age aspect of the sample of this study, the table

4-2 below presents the age differences among respondents.

Table 4-2: Ages aspect of respondents

48

Frequency Percent20-30 ages 16 35.6%31-40 ages 8 17.8%40-50 ages 12 26.7%51-60 5 11%60 and over 4 8.9%Total 45 100%Source: Primary data

Generally as it is seen in this table, all respondents were over

20 ages and among them, the majority was 35.6% of respondents and

was in the range of 20-30 ages while the respondents over 60 ages

were minority. So, the researcher has found that adult people use

to make transactions many times in the bank.

4.1.1.3. Academic level aspect

The results related to academic level of respondents are in table

4-3 below.

Table 4-3: Academic level aspect

49

Frequency PercentPhD 5 11.2%Master's 6 13.3%Bachelor's 18 40.0%Secondary 10 22.2%Primary 6 13.3%Total 45 100%Source: Primary dataThe results of this study shown that, most of respondents (40%)

have had a bachelor’s degree. In general all respondents had a

certain level of education and this shown that they are able to

make basic bank transactions.

4.1.2 MARKETING MIX PERCEIVED BY CUSTOMERS IN BANK OF KIGALI

As stated in the chapter three, Bank of Kigali is a financial

service that delivers six services such as loans, saving, money

transfer, E-Banking, Visa card and ATM, Western union and ZIP

card.

4.1.2.1 The use of Bank of Kigali services

The results related of BK’s services are shown in the table 4-4

below.

Table 4-4: the use of services of Bank of Kigali

50

Frequency PercentLoans 11 24.4%Saving 13 28.9%Money transfer 6 13.3%Visa card 7 15.6%Western union 5 11.1%Zip card 3 6.7%Total 45 100%Source: Primary data

As it is seen in this table the service that is mostly used by

customers (28.9%) is saving. This is because saving is the

precursor of other main services that are delivered in BK. The

less used service is ZIP Card because it is a new one. In

general, the results of this study show that all services of Bank

of Kigali are helpful to customers. These findings reveal that

the products of BK (1ST variable of marketing mix) are well known

by customers.

4.1.2.2 Services of Bank of Kigali and customers ‘satisfaction

Concerning customers’ satisfaction, the table 4-5 below

illustrates the appreciation customers on Bank of Kigali

services.

Table 4-5: Customers’ appreciation on Bank of Kigali services.

51

Frequency PercentExcellent 24 53.3%Very good 18 40.0%Good 3 6.7%Total 45 100.%Source: Primary data

As it is shown in this table, the customers of Bank of Kigali are

satisfied by the services they get from this bank. Practically,

over 93.3% of customers have found the services of Bank of Kigali

excellent and very good. Then the researcher deducts that Bank of

Kigali has highly satisfied its customers. And the satisfaction

is a basic prerequisite for successful business and survival in

the market. Final, this means that the services of BK match

customer tastes and preferences. Then turnover and profitability

of the institution will increase, consequently the performance

will follow.

4.1.2.3 Customers ‘perception on the cost of Bank of Kigali services

Regarding the price side of marketing mix of Bank of Kigali, the

table 4-6 demonstrates the perception of customers about the cost

of Bank of Kigali services.

Table 4-6: Customers ‘perception on the cost of services of BK

52

Frequency PercentVery high 10 22.3%High 20 44.4%Not high 15 33.3%Total 45 100%Source: Primary data In these findings the researcher has found that the cost of

services in BK is likely not cheaper but affordable. Indeed 33.3%

of customers found the cost of Bank of Kigali services not high.

Then, as it was stated in chapter two, adjusting the price has a

profound impact to marketing strategy and often affects the

demand and sales of services as well. Then it can inform the

performance of the company.

4.1.2.4 Accessibility of Bank of Kigali

As it stated in chapter two, the place plays an important role in

the success of business. The place normally influences the volume

of sales because the easy and options through which the company

can make its products available to customers will have an effect

on company ‘sales volume.

Table 4-7: Customers’ perception on the accessibility of service of Bank of Kigali

Frequency PercentVery easy 23 51.1%Easy 17 37.8%Not easy 5 11.1%Total 45 100%

53

Source: Primary data

Then the results in table 4-7 above, reveals that Bank of Kigali

has put much emphasis in facilitating customers to access to its

services as long as 88.9% of respondents accessed very easy and

easily to the services of Bank of Kigali. Hence, this shows Bank

of Kigali has a good distribution channel (the 3rd variable of

marketing mix) and it means that BK has expanded its branches to

bring closer its services to its customers.

Consequently, the more the distribution channels increase, the

more the number of customers reduces per branch; eventually the

time for a customer in waiting to be served reduces as well.

4.1.2.8 Promptness of Bank of Kigali services

Time management is the limiting factor in business. In all

services people are served according the arrival order and for

some companies it takes time to wait so that to get served. The

table 4-8 below shows the time for customer in waiting to be

served at Bank of Kigali.

Table 4-8: Customers ‘perception on waiting time in order to get served

54

Frequency Percent1-5 min 7 15.6%6-10 min 10 22.2%11-30 min 15 33.3%31-60 min 6 13.3%Over 60 min 7 15.6%Total 45 100%Source: Primary data

In these results, the researcher has found that the time to wait

before getting served is average. Normally, as the study shown in

this table, the average time for a customer to wait so that to

get served is not boredom. 55.5 % of respondents said that they

get served within 5 minutes (6-10 mi) and 20 minutes (11-30 min)

which are really reasonable time to wait.

4.1.2.5 Promotion strategy of Bank of Kigali

Promotion is concerned with any vehicle you employ for getting

people to know more about your offering. Then the company can use

advertising, publicity and other strategic ways. In the table 4-9

below the researcher presented the different promotion strategy

and their perception to customers.

Table 4-7: Customers ‘perception on promotion strategy of Bank of Kigali

55

Frequency PercentAdvertising 13 28.9%Billboard 7 15.6%Publicity 5 11.1%All 20 44.4%Total 45 100%Source: Primary data

In this study, the findings show that Bank of Kigali is an

outstanding in promoting its products. Practically, as the

researcher has found, a good number (44.4%) of respondents

experienced more than one way of getting the information about

the services of Bank of Kigali. Then it can be concluded about

promotion (the 4th variable of marketing mix) that is used by BK

that it has a great impact to its sales and consequently to its

profitability and performance.

In general, Bank of Kigali has a viable marketing mix given the

results the researcher has found to the above. Consequently, this

state of marketing mix has played a big role in the performance

of Bank of Kigali as it is shown in the following point on the

performance side of Bank of Kigali.

4.1.3 MARKETING MIX AND PERFORMANCE PERCEPTION OF BANK OF KIGALI

Performance is a tool that is used by organization to evaluate its

success or the success of a particular activity in which it is

engaged. As it was stated in chapter two this evaluation is done by56

using performance indicators or Key performance indicators (KPIs) or

performance measurement.

4.1.3.1. The state of marketing at Bank of Kigali

At Bank OF Kigali, the process of activities is covered by the

marketing concept and levered up by marketing mix for the

outstanding achievement of its objectives. As it was said by the

staff, Bank of Kigali has put effort in developing the 4P’S of

marketing mix. This marketing mix plays an important role in the

development of the Bank.

In fact, the findings show that, during 2011 Bank of Kigali has

focused on increasing its product and service offering in both

corporate and retail banking in order to meet the changing needs

of its customers. The biggest achievement was the launch of its

mobile banking service which gives customers the ability to check

their balances and order check books, in addition to purchasing

prepaid electricity, prepaid TV and intra-bank money transfer in

addition to giving customers with account information and daily

exchange rates. In the card business, the Bank started issuing

internationally accepted VISA Electron Debi cards in addition to

the local branded cards from R-SWITCH and the prepaid ZIPP Card

which is targeted at the lower income earners. Also Bank of

Kigali is also responsible for the growth of the branch

infrastructure which has seen the Bank’s branch network grow from

14 in 2008 to 44 in 2011.

57

4.1.3.2. Performance indicators of Bank of Kigali

There are various indicators of performance in financial

industry. In this study the researcher has considered some

indicators that reveal the performance of Bank of Kigali such as

total assets, customers ‘deposits, profit after tax, gloss loans,

customers’ deposits, delivery channels evolution. The table 4-10

below shows the extent of these indicators of performance.

Table 4-10: Performance indicators of Bank of Kigali

No Indicators   2009 2010 2011

 1Total assets (Rwf bn) 151.9 197.7 287.9

 2Profit after tax (Rwf bn) 5.9 6.2 8.7

 3 Gross loans (Rwf bn) 80.9 105.5 130.7

 4Customers ‘deposits (Rwf bn) 109.5 135.7 181

 5 Delivery channels: ATMS 6 26 26

 Branches 18 33 44

      POS 52 97 202

In this frame, the researcher has deducted that the increase of

each indicators implies performance of BK. Particularly, the

increase number of delivery channels shows that the number of

customers have increased that the BK was obliged to install other

branches so that to bring services closer to people. Therefore,

this shows that Bank of Kigali has a strong distribution

strategy.

58

4.2 DISCUSSION, ANALYSIS AND INTERPRETATION OF THE DATA

The first objective of this study was to find out whether

marketing mix of Bank of Kigali has performance effect on its

service delivery to its customers. Then as it was said in chapter

two, the performance effect for financial services can be seen

trough financial and non-financial analysis. For this study the

researcher relayed on both financial and non-financial analysis.

In this way, the researcher has found that Bank of Kigali has

made an outstanding performance. In fact, on the side of customer

satisfaction which is the limiting factor of performance the rate

is high (93.3%). For the state of 4P’s, there is an important

development of them. For price issue, one of the main factors

that destroy the functioning of services, 33.3% of customers

found the cost of Bank of Kigali services not high. Bank of

Kigali has also made a rewarding step in terms of accessibility

of product. On this aspect the results showed that 88.9% of

respondents accessed very easy and easily the services of Bank of

Kigali. In the frame of attracting customers to the services

delivery, Bank of Kigali has an over-power of communicating its

services. Practically, the results of this study has shown that a

good number (44.4%) of respondents experienced more than one way

of getting the information about the services of Bank of Kigali.

59

The second objective of this study was to examine the performance

effect of marketing mix on Bank of Kigali towards its customer

service delivery. Truly speaking, Bank of Kigali is a paradox

financial service in Rwanda. In fact, the researcher has found in

the results of this study that from 2007 up to 2011Bank of Kigali

has realized an increase of total asset by 24.1%, customers

‘deposit increased by 15.5%, the profit after tax increased at

19.5% and the number of branches increased from 11 in 2007 up to

44 in 2011 (BK Annual report, 2011:3-4).

CHAPTER FIVE: CONCLUSION AND RECOMMANDATIONS

SUMMARY OF THE FINDINGS

The findings of this study have presented the perceptions of

customers on the 4P’s of marketing mix at Bank of Kigali, on the

other side the findings presented the state of marketing

performance of BK and these findings are summarized like

following:

60

On the side of satisfaction of the customers of Bank of Kigali,

the rate goes at 93.3%, pricing perception is average as 33.3% of

customers found the cost of Bank of Kigali services not high; the

findings revealed also that Bank of Kigali has put much emphasis

in facilitating customers to access to its services as long as

88.9% of respondents accessed very easy and easily the services

of Bank of Kigali. On promotion side 44.4% of respondents

experienced more than one way of getting the information about

the services of Bank of Kigali while the time for customer to

wait in order to be serviced has been found reasonable as 55.5 %

of respondents said that they get served within 5 minutes (6-10

min) and 20 minutes (11-30 min).

In terms of marketing performance, Bank of Kigali has an

outstanding pattern of professionalism that led in financial

success. In fact, the findings have shown that from 2007 up to

2011Bank of Kigali has realized an increase of total asset by

24.1%, increase of customers ‘deposit of 15.5%, the profit after

tax of 19.5% and the number of branches increased from 11 in 2007

up to 44 in 2011. Finally, the net profit has increased by 40.6%.

Therefore, the marketing mix of Bank of Kigali has greater

contribution on its performance towards its customers as long as

both customers and Bank of Kigali have rejoiced the fruits of all

the effort that was put in the process of achieving vision, value

and mission of Bank of Kigali and its objectives as well.

61

5.2 RECOMMANDATIONS

To the Bank of Kigali: The Bank of Kigali should put much

emphasis in reducing the cost of its services given that a little

number of customers is satisfied by this one.

To INILAK: For further researchers, INILAK should encourage its

students to continue to use the given study as a draft for long

term studies in order to explore deeply the trends about

performance marketing especially for financial measurements.

62

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Appendices

Data collection instrument

Questionnaires addressed to Customers

Dear Respondent

This questionnaire is designed to seek information from you on

The effect of Marketing mix to the Performance of financial

services in Rwanda, a case study of Bank of Kigali.

It is carried as a partial fulfillment of the requirements for

the award of a Bachelor’s Degree in Marketing in Independent

Institute of Lay Adventists of Kigali (INILAK). Your

contribution, opinions and experience will be highly appreciated.

Thank you very much for your assistance.

Please tick the appropriate box ( ) where applicable in the

space given with along tick in the bracket.

Respondent category: B customer/clients

I. Personal information

1. Gender

Female Male

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2. Age

20-30 31-40 41-50 51-6061 and over

3. Academic level of the customers/clients

a. PhD b. Master’s c. Bachelor’s degreed. Diploma

e. Certificate f. Secondary g. Primary h.Not educated

II. Marketing mix (4ps)

1. How did you know Bank of Kigali and its services?

Through: a. Advertising b. Billboard c. Publicity

d. All

2. How do you access at Bank of Kigali?

a. Very easy

why? ....................................................

......................................

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b. b. Easy

why? ....................................................

.......................................

c. Not easy

why? ....................................................

........................................

3. What type of service do you get most from Bank of Kigali

among others

a. Loans b. Savings c. E-Banking d.

Visa Card& ATM

e Western Union f. Zip Card

4. How do you perceive the services offered by BK?

a. Very excellent b. excellent c. Not

excellent

5. How do you appreciate the cost of loan of BK compared to

other Banks?

a. Very high b. High c. Not high

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6. How long do you wait for getting served? Between:

a. 1-5 min b. 6-10 min c. 11-30 d. 31-60

e. Is there any services do/did you get for over 60min?

yes No

f. If yes, which kind of service?

7. What are the constraints do you face in using the services

of Bank of Kigali?

………………………………………………………………………………………………………………………………………………………………

………………………………………………………………………………………………………………………………

Thanks

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Data collection instrument

Questionnaires addressed to Bank of Kigali

Dear Respondent

This questionnaire is designed to seek information from you on

The effect of Marketing mix to the Performance of financial

services in Rwanda, a case study of Bank of Kigali.

It is carried as a partial fulfillment of the requirements for

the award of a Bachelor’s Degree in Marketing in Independent

Institute of Lay Adventists of Kigali (INILAK). Your

71

contribution, opinions and experience will be highly appreciated.

Thank you very much for your assistance.

Please tick the appropriate box ( ) where applicable in the

space given with along tick in the bracket.

Respondent category: A/Bank of Kigali

I. Primary information

1. Company name: ……………………………………………………………………………

2. Physical address: …………………………………………………………………………..

3. Experience: ………………………………………………………………………………..

4. Type of Business:

…………………………………………............................................

.....

II. Marketing mix

1. Does your Bank engage in marketing mix? Yes No

2. If yes, how often does your bank do strategic marketing mix?

a. Monthly b. Quarterly c. Annually

d. Other answer: ………….

3. What services do you provide as result of marketing mix to

customers of bank of Kigali as financial service provider?

………………………………………………………………………………………………………………………………………………………………

……………………………..

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4. In your customer care service provision, what type of

services does bank of Kigali customers seek often in daily

bank service delivery?

………………………………………………………………………………………………

5. Does marketing mix play important role to the development of

your bank?

Yes No

a. If yes, in which key areas or departments?

………………………………………………………………………………………………

b. What are the determinants of the development of your Bank

as results of the use of marketing mix?

………………………………………………………………………………………………………………………………………………………

……………………………

6. What are the factors (constraints) of marketing mix

affecting the performance of Bank of Kigali?

………………………………………………………………………………………………………………………………………………………………

………………………………

III. Performance indicators

1. What are trends of BK performance in terms of the following variables (performance indicators) in the table below?

No Indicators   2009 2010 2011

 1Total assets (Rwf bn)

 2 Profit after tax

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(Rwf bn) 3 Gross loans (Rwf bn)

 4Customers ‘deposits (Rwf bn)

 5 Delivery channels: ATMS

 Branches

      POS

2. Are your services being computerized? Yes No

Thanks

74