Competitive Strategies Used by Commercial Banks in Kenya to Attract Corporate Customers

Abstract

The concept of strategy has been underscored by various management scholars and practitioners. Competitive strategy is involved with the search for a favourable competitive positioning in the industry. In this sense it is concerned with how a company can gain advantage through a distinctive way of competing by establishing a profitable and sustainable position against the forces that determine industry competition. The objective of this study was to identify competitive strategies used by commercial banks in Kenya to attract corporate customers. The study adopted a cross sectional descriptive survey research design. The approach was used to obtain data concerning the current status of the phenomena. The target population for this study was all the forty three (43) commercial banks registered by the Central Bank of Kenya as at April 2014 and the primary data was collected by use of a standard questionnaire. Descriptive statistics such as means, standard deviations and frequencies as well as bivariate analysis in form of cross tabulation was used to analyse the data. The descriptive analysis was useful in giving summaries while the bivariate analysis was helpful in identifying differences among groups. Analysis of variance was also carried out to identify statistical significance of the findings and inferring the results to the entire population. The study concluded that there is empirical evidence to demonstrate that cost leadership; differentiation; and focus strategies are being used by the commercial banks in Kenya to attract corporate clients. The study recommends retention strategies beyond the attraction strategies being adopted. It also recommends a more focused approach targeting specific clients as they possess unique needs. Finally replication of the study in different sectors under different circumstances would be welcome to establish the validity and generalizability of the present findings across different sectors and contexts.