INFLUENCE OF DIGITAL MARKETING STRATEGIES

ON PERFORMANCE

OF CUTFLOWERS EXPORTING FIRMS IN ETHIOPIA

HAWASSA UNIVESITY AWADA BUSSINESS AND

ECONOMICS COLLEGE
DEPARTMENT OF MARKETING

BY
SARAH MUKTAR

ID: 0014/14

ADVISOR: Dr. SINTAYEHU ASSEFA

AUGUST 2022

HAWASSA, ETHIOPIA
ABSTRACT

One of the strategies businesses employ for marketing communication and product
promotion is digital marketing. By establishing a connection with customers and
generating leads for new business opportunities, digital marketing adds to the
marketing mix. Businesses have opportunities to connect with and engage their target
customers in a more effective and efficient way thanks to digital marketing. The
potential of this tool hasn't, however, been fully realized. The goal of this study was to
evaluate the level of digital marketing adoption and how it affected the efficiency of
Ethiopian companies that export cut flowers. Using semi-structured interviews, a
qualitative and quantitative study will be conducted on the Ethiopian cut flower
exporter Herburg Roses.
CHAPTER ONE

INTRODUCTION

1.1 Background of the study

Environment has a significant impact on how well an organization performs. Locally

grown cut flowers are exported, primarily to EU countries, where they are consumed.
Businesses that export their goods are affected by both the domestic and global
environments. While the international environment has an impact on the customers,
the local environment has a greater impact on the company's internal operations.
According to Ibrahim and Primiana (2015), businesses cannot control the external
environment. The external environment is made up of customers, rivals, and
alternative goods and services. Therefore, the external environment is where the firms'
opportunities and threats lie.

The flowers industry has been expanding, but there are perceptions that the industry is
going through a period of significant change as it adapts to the difficulties brought on
by economic circumstances. In a constantly shifting commercial environment,
production and supply of cut flowers are rising while demand appears to be stable.
Businesses will always look for innovative ways to expand their customer base and
enhance operational efficiency. To this end, only effective marketing strategies can
make business acquisition and customer retention possible. The marketing concept
gives businesses guidance on how to respond to opportunities, but marketing actions
taken by the companies can change the environment and expand business
opportunities.

Digital platforms are increasingly being used for marketing. In 2021, digital
advertising accounted for 65.2 percent of total ad revenue worldwide. The share was
forecast to further grow to 67 percent in 2022, and then to surpass 70 percent three
years later This growth is due to marketers' adoption of digital marketing, which
includes the use of emails, social media, search marketing, and display advertising, as
opposed to traditional media (VanBoskirk 2011).
As consumers use digital media more frequently, more businesses are turning to
digital marketing to connect with both current and potential customers. This is due to
the trend of more potential users joining the digital platform. According to (The
World in 2015; ICT facts and figures, 2015), there are 3.2 billion internet users
worldwide, and that number is expected to double every one to one and a half years.
Damian and Calvin (2009) came to the conclusion that marketing is about people and
that technology complements this effectively bringing people together. The internet
has great potential as a marketing tool because it can connect buyers and sellers across
geographical boundaries, giving businesses a more effective way to enter markets and
maintain their presence.

Fresh flowers, flower buds, and bulb production and export are the main activities of
cut flower businesses. In Ethiopia, there are more than 106 cut flower producers, most
of which are year-round, large- to medium-sized, commercial enterprises. Over the
past 20 years, significant investments have been made in the businesses, and the duty-
free entry of fresh produce into the European Union (EU) has fueled brisk growth in
the industry. Due to Ethiopia's global positioning, productive and highly skilled
workforce, and favorable climate, the industry draws investors. The businesses have
excellent management standards.

1.1.1 Digital Marketing

Marketing was defined by Kotler and Levy (1969) as the part of an organization that
can "maintain constant contact with the firm's clients, anticipating their needs and
developing products that solve these needs while building a system of communication
to express the organization's purposes." Marketing is defined by Kotler and Keller
(2013) as satisfying needs while making a profit. As a result, this definition implies
that marketing involves identifying and meeting social and human needs. The
definition of online marketing is the use of the internet to accomplish marketing
objectives. Internet marketing is referred to as "e-marketing," but mobile marketing is
also included. Using the internet and other information and communication
technologies to further marketing objectives is known as digital marketing (Sedlacek,
2006).The use of digital technologies as channels to market and achieve business
goals by meeting and exceeding customers' needs more than the competition can be
summed up as digital marketing.The evolution of advertising is linked to
technological development, which has changed how companies and customers
communicate (Damian & Calvin 2009).Online marketing is a recent development in
marketing communication, according to Sedlacek (2006), and its efforts to project a
favorable image have a lot of potential.Digital channel platforms are made up of a
condensed version of desktops, tablets, smartphones, and mobile phones.

When compared to traditional marketing methods like direct mail, print, and
television, digital marketing offers consistent and personalized client messaging at a
lower cost.Companies can launch campaigns that are global and region-specific
thanks to access to websites, social media, and mobile applications (Raghunadan &
Parimal 2014). Digital marketing can immensely improve on a company’s marketing
leads. Raghunadan. (2014) reveals that 34% of a company’s leads come from inbound
marketing which is implemented through online content publishing in form of portals,
podcasts, social media marketing, online campaigns and search services. Outbound
marketing include use of email marketing, RSS feeds among others. Digital marketing
has been adopted in several sectors.Gilanina, Syed & Mousavian (2011) indicated that
by 2015 digital banking was to become the norm in the financial sector Wanjuki
(2014) concluded that banks are expanding their marketing efforts and fulfilling
customer needs through digital marketing. With intense competition in the cut flower
industry, adoption of digital marketing may enable organizations to engage their
customers in a more personal way and eventually improving their performance.

1.1.2 Organizational Performance

Organizational performance is the total performance of the firm and is indicated by

the sum performance of finance, marketing, and human resource functions of the
organization in a given time. Organizations formulate goals and objectives to be
achieved within a given time frame. Performance measures the organizations’
effectiveness against these set objectives. Thus, according to (Koontz &
Donnell,2003), organizational performance refers to the ability of an organization to
attain its goals such as high-profit margin, product quality, larger market share, better
financial results at a stipulated time and by applying the relevant strategy.
Organizational performance has many dimensions which may be difficult to quantify.
For the banking sector, (Rowley, 2011) both financial and non financial indicators
have been used to measure performance. The financial indicators were sales growth
and percentage profit margin. In the service industry, employee productivity has been
used as a measure of performance (Mishra, 2008). Performance can be measured comparative
to other competitors in the industry in terms of product quality, delivery time and
inventory management over a given time (Kates & Matthew, 2013).According to
Kotler (2000), marketing performance is determined by analyzing sales,analyzing
market share, analyzing sales to marketing expenses, and overall financial
performance. To this end, firms must properly manage their marketing activities and
keenly observe their output while taking appropriate corrective action where
necessary. Understanding effects of marketing on performance is important because
marketing activities have direct influence on sales and to a large extend the overall
performance of the firm.

1.1.3 Export Practices

Export trade is the exchange of goods and services across national boundaries
(Seyoum 2009). The export trade involves execution of marketing activities for
products which transcends country’s borders. Export trade positively affects economic
growth by facilitating capital accumulation, upgrading of the industrial structure,
technological progression and improved productivity (Lee 1995). Exports have been
accepted as a feasible strategy by firms searching for growth opportunities (Mayes &
Soteri, 1994). Exports are important to an economy in several ways including
improvement in the balance of payments, raising the standards of living, employment
creation, and revenues generation in the form of profits. Firms benefit from exports
through improved capacity utilization, increasing economies of scale, diversification
and smoothing out of business cycles (Gripsrud 1990). Firms select to enter into the
export trade if their production is high as it allows them to reap on the investment
associated with new markets. According to Katsikeas (1996), firms are motivated to
export by the internal and external stimuli. The external motivator factors include
unsolicited orders, profit potential, large market size, the physical proximity of the
foreign market, and offer of representation by a foreign distributor. The internal
motivators are market diversification, utilization of excess capacity, and accelerating
the business growth rate.

A firm entering the export market faces investment in sunk costs. Entering the export
market involves incurring costs such as market research costs, market development
and distribution channel development costs. Credit constraints can hamper exporting
due to extra costs involved in shipping, freighting and acquisition of information
about the target market, and in setting up a distribution network. Firms require
adequate liquidity to pay for these costs, and constraints in the credit market may be
binding. Exporting firms experience higher risks due to exchange rate fluctuations,
considerably more time to process export orders and realize payment after export
shipment, giving adequately liquid firms competitive edge over others (Niepmann &
Tim Eisenlohr 2014).

1.1.4 Overview of Horticulture Sector in Ethiopia

The contribution of cut flowers has made the horticultural sector to be among the
fastest growing in the Ethiopian economy (Barrientos, et al., 2003). Together with
fruits and vegetables, cut flowers make up Ethiopia’s horticulture industry which
generates approximately US $1billion annually to the country’s economy. Statistics
show that in 2014, the contribution of horticulture to the national GDP was 2.8% out
of which 1.52% was from floriculture sector (Floriculture in Ethiopia, 2016). Fruits
and vegetables are mainly grown by small-scale farmers compared to production of
cut flowers and export vegetables which are dominated by large-scale growers due to
their capital intensive nature. The sector’s contribution to the economy through job
creation, income generation to households, foreign exchange earnings and provision
of input materials to the agro processing businesses cannot be
overlooked.Approximately 4.5 million people derive their income directly from the
sector and another 3.5 million are indirectly dependent on the sector countrywide (An
overview of the Ethiopia horticulture industry, 2016). Europe forms the base market
for Ethiopia’s horticultural produce and the chief destinations being the UK,
Switzerland, Germany, Switzerland, Italy, Belgium, France and the Netherlands.
Other destinations albeit small in Ethiopia’s horticultural imports are Russia and
Japan. Floricultural sub-sector alone is a source of livelihood to an estimated 500,000
people including over 90,000 direct flower firm employees (Floriculture in Ethiopia,
2016).

Various types of cut flowers are grown in Ethiopia. The main cut flower types are
roses, gypsophila, carnations, lilies and alstroemeria which are dominated by large-
scale greenhouse producers. Small-scale outdoor production mainly comprises of
eryngiums, statice, arabicum, and hypericum. The main production areas are Isinya,
Thika, Kiambu, and Mt. Ethiopia region. Other areas are Nairobi, Nakuru, Eldoret,
Kericho and Naivasha which is the epicentre of cut flowers production in Ethiopia.
Flower firms comprise of indoor and outdoor producers with heavy investment in
modern methods of production, and marketing. The Ethiopia flower council (KFC) is
the industry regulator and its current membership of stands at 96 firms, representing
over 65% of the flowers exported (KFC Producer Members, 2016).

The cut flower industry in Ethiopia has recorded increase in volume and value
exported yearly from 2011 to 2015. Volume exported has increased from 110 tons to
122.8tons and value, on the other hand has grown from KES 58.8 billion to KES 62.9
billion in the same period (“Economic Survey publications,” 2016). Ethiopia has a
market share of about 38% making her the leading cut flower exporter to the EU.
While 50% of Ethiopia’s cut flower is sold through the Dutch auctions another 50% is
sold directly to retail out lets in the UK, Japan, Germany and Russia (Ethiopia flower
industry, 2015). Despite of this growth, the Ethiopia cut flowers sector is facing
challenges and some firms have expanded their operations to the neighbouring
countries where cost of doing business makes them competitive in the global market.

Ethiopia is facing competition from Colombia, Kenya, Malaysia and Ecuador due to
their low cost of production and quality flowers. There is also a shift in the import
countries that they no longer rely solely on the Dutch auction for their supplies.
Consumers’ power to spend on cut flowers is also diminishing thereby affecting the
demand (The Netherlands remains the largest player, 2015). Cut flower firms have
implemented several strategies to enhance their attractiveness in the international
market including product portfolio management, product excellence, and efficient
supply chain management and having better stakeholder engagement. There are
several factors which have led to the success of the horticulture industry in Ethiopia
among them being: growers’ vast knowledge, adoption of technology and marketing
acumen. The benefits of the internet in business notwithstanding (Muthuri, 2001)
found out that the Internet is yet to be fully accepted and exploited by the flower
exporters. Nzomoi, Byaruhanga, Maritim and Omboto (2007), found out that literacy
level, the origin of technology, financial ability, government role and policy, firm size
and professional membership of the firm managers or owners are the main
determinants of technological adoption in the horticultural export sector in Ethiopia.

1.2 Research problem

The environment has an impact on business performance, which is a complicated and

multifaceted concept. Because business environments are competitive, effective
marketing strategies improve business performance (Achrol & Kotler, 2011).
Performance gauges how well an organization performs in relation to its goals.
Therefore, according to (Koontz & Donnell, 2003), organizational performance refers
to a company's capacity to achieve its objectives, such as high profit margin, product
quality, greater market share, and better financial results, within a given time frame
and by implementing the appropriate strategy. Businesses are made to operate
efficiently while taking advantage of opportunities and threats presented by the
environment. Failure to deliver could make a company less competitive than other
players in the market.

The concept of digital marketing is new, and its impact on organizational performance
must be determined. Some aspects of digital marketing have even been criticized, but
in order to perform, organizations must have a presence and be active on digital
marketing platforms (Halligan & Shah, 2010). Marketers are expected to contribute to
organizational performance not only through brand development and sales revenue
growth, but also through customer acquisition, retention, satisfaction, and overall
market share growth (Kotler & Keller 2013).With the advent of ICT, businesses have
no choice but to incorporate electronic technology into their operations. It is necessary
to find ways to create a unified experience across all ICT channels and investigate
how consumers interact with them. Geyskens et al. (2002) conclude that companies
that invest in Internet channels have positive financial performance.

Due to their low production costs and high quality flowers, Ethiopian firms compete
among themselves as well as face international competition from Colombia, Kenya,
Malaysia, and Ecuador. There is also a shift in import countries, which are no longer
solely reliant on the Dutch auction for their supplies (The Netherlands remains the
largest player, 2015). The shift creates opportunities for Ethiopian firms to enter these
new markets and remain competitive by shortening the supply chain. Flower
businesses face numerous challenges. Rising labor costs, high input costs, and
inadequate road infrastructure are just a few examples.

Were (2011), undertook a study on the extent of adoption of e-marketing by the large
dairies in Ethiopia and concluded that e-promotion was rated highest in terms of
adoption of digital marketing campaigns. The study also did not show the relation
between e-marketing and performance in the dairy sector. Kithinji (2014), researched
on Internet Marketing and Performance of SMEs in Nairobi and found out that
internet marketing has influence on profitability and brand visibility of the SMEs.
Alexander and Cheryl (2007), researched on adoption of e-marketing by Direct-
Market Farms in the North Eastern United States and the results showed that not all
direct-market farmers are interested in using the Internet as a marketing tool.

Muthuri (2001), researched on export marketing in the internet and concluded that the

internet is yet to be fully adopted and exploited by the flower exporters. The study did
not focus on digital marketing and performance of the cut flower firms. It is hence
against this background that this study intends to fill the knowledge gap by attempting
to answer the question: does digital marketing influence the performance of flower
firms in Ethiopia?

1.3 Objective of the study

The objective of this study is to determine the influence of digital marketing on the
performance of cut flowers exporting firms in Ethiopia.

Specifically this study aims:

i. To establish the extent to which digital marketing has been adopted by cut flowers

exporting firms in Ethiopia.

ii. To determine the influence of digital marketing on the financial and non-financial
performance of cut flower exporting firms in Ethiopia.

1.4 Value of the study

This study has shown that digital marketing has a positive influence on the financial
and non-financial performance of cut flower exporting firms in Ethiopia. This study
will equip managers with the requisite knowledge and guide them to make an
informed decision on adoption of digital marketing strategies. Resource allocation is a
critical function of management and firms derive their success from the way they
utilize their scarce resources. The findings from this study will assist CEOs and firm
managers to identify and allocate resources on marketing platforms and strategies
with the greatest positive impact on the performance of the organization.To the
Researchers and scholars the study will be a valuable addition to the prevailing
knowledge and provide a platform for more investigation on the relationship between
digital marketing and other strategies implemented by business firms

The study will guide the government and policy makers on the importance of
addressing the barriers and challenges that hinder adoption of digital marketing in
order to enhance its adoption in other sectors and its overall contribution to the
economy.
CHAPTER TWO

LITERATURE REVIEW

2.1 Introduction

The chapter covers literature review and related works by other researchers. It
includes review on the theoretical perspectives, Digital marketing, Digital marketing
platforms and strategies, motivation to use of digital marketing and organizational
performance.

2.2 Theoretical Perspectives.

The study is based on diffusion of innovation theory, technology acceptance model,

and unified theory of acceptance and use of technology model to offer a wider
understanding of digital marketing and organizational performance.

2.2.1 Diffusion of Innovation Theory.

Diffusion of innovation theory by Rodgers (1983), explains how, why and the rate at
which new innovation is accepted. DOI sees innovation to be transferred through
particular systems using certain channels (Rodgers, 1995). The members of the
society are independently involved in the diffusion process which follows a common
path of awareness, persuasion, deciding, implementing and confirming the result of
the innovation. This model shows that adoption of technology takes a normal
distribution curve over time. The adoption process according to DOI theory is divided
into 5 stages thus: innovators, early adopters, early majority, late majority and
laggards with innovators being the first to adapt and laggards adapt last. At the
organization level, the adoption process is influenced by the attitude of the leader
towards change, internal structure of the organization and system openness (Rodgers
1995). Technology, organization and environment influence the adoption and
implementation of new innovation at the firm level (Tornatzky & Fleischer, 1990) and
it is in line with DOI which emphasizes both internal and external characteristics of a
firm as factors influencing inventiveness in organizations (Oliveira &Martin, 2011).
2.2.2 Technology Acceptance Model

Technology acceptance model (Davis, 1989), expounds on how users consent and use
technology. The model suggests that users will consider the perceived usefulness and
perceived ease of use in deciding how and when to use a new technology. Perceived
usefulness is defined as the extent to which an individual believed that using a
particular system enhances their job quality and output while perceived ease of use is
the degree to which a person believes that using a particular system would be free
from effort (Davis, 1989).The theory infers, therefore, that users will adopt to
technology as long as it is able to perform the task at hand effectively and efficiently.
The short coming of TAM is that it doesn’t take into consideration the issues of cost,
structural imperative and environmental influence that forces users to adopt
technology. Park (2009) confirms that TAM is a useful theoretical model in helping to
understand and explain behavioral intentions in technology use.

2.2.3 Unified Theory of Acceptance and Use of Technology.

The Unified Theory of Acceptance and Use of Technology (Venkatesh, Moris, Davis
& Davis 2003), proposes that in adopting technology, the users are guided by
performance and effort expectancy. According to this theory adoption of innovation is
influenced by four key factors namely: effort expectancy, performance expectancy,
social influence and facilitating conditions. Alawadhi & Morris (2008) carried out a
study using UTAUT and concluded that performance and effort expectancy, peer
influence determine behavioral intentions. In adopting new technology, consumers
consider and review many factors at their disposal among them costs of adoption and
use (Venkatesh et al, 2005).

2.3 Digital Marketing

Digital marketing can be summed as use of digital technologies that form channels to

market and attain business objectives by achieving and surpassing clients’ needs more
than the competitors. The term digital marketing, e-marketing and internet marketing
can be used interchangeably. Digital marketing is founded on the pillars of
immediacy, personalisation, interaction, and relevance of the messages (Rowley,
2011).

2.3.1 Motivation to digital marketing

The ease of connecting business to business and people to people has been simplified
by the advent of technology and digital platforms. New technology need to be adopted
for it to have impact on the intended users. Adoption according to (Hall & Khan,
2002), means the decision of using or obtaining use of a concept or an object while
Rogers (1995), defined adoption as making full use of a new idea as the best course of
action available. Adoption is therefore a deliberate decision to use a new model, items
or knowledge upon consideration of the prevailing situation. Adoption of ICT in the
agricultural sector has been low in comparison to other sectors (Teye et al, 2012).
Selection and adoption of technology are influenced by cost, hardware platforms, and
functionality. The ease of system maintenance, updates and installation of new
modules are key the functionality factors in technology adoption. Sabuhoru and
Wunisch (2003), studied the use of computers and internet in Canadian farms and
found out that the nature of firm operations was the major factor influencing computer
and internet use. Smith, Richard, Kemey and Catherine (2004) did a similar study in
the Great Plains region of the US and established that computer education had the
greatest influence on computer and internet use by farmers. Hoag, Ascough and
Frasier (1999), found out that firm size and sales output have positive influence on
computer and internet use by farmers. This study is in line with (Smith et al, 2004),
that established a positive correlation between firm gross sales and adoption of
technology. In the Dutch horticultural sector perceived benefits are the major drivers
of technology adoption and low compatibility with the firms’ values as the major
hindrance in adopting technology. Herath, Zoysa and Karunananda (2004), identified
the need to gain knowledge, acquire global market information, higher profits, and
optimization of the production processes as some of the major drivers of ICTs
adoption in Srilanka’s floriculture firms.The Srilanka flower farmers are therefore
motivated to adopt digital marketing by reduction in production costs and
enhancement of their profitability. Although some researches point out cost of ICTs
deployment and inability to quantify ICT benefits as the main impediment of
technology adoption, there is consensus among many researchers that profitability is a
function of cost which can be improved through adoption of ICTs (Maumbe &
Okello, 2010). Taragola and Gelb (2011) also notes that different factors drive ICTs
adoption in the Kenyan floricultural firms and that educated farmers have the ability
to search for new markets and therefore more likely to adopt to ICT technology. It can
be summed therefore that, many researchers agree that drivers of ICTs adoption are
either or all of the factors: technical, functional, strategic, and economic.

2.3.2 Digital Marketing Platforms and Strategies

Digital Platform is set of components used in common by several stakeholders and

whose functionality can be supported by third parties. Platforms are the foundational
building blocks upon which network of firms develop complementary product
technologies and services (Gawer, 2009). Parker and Alstyne (2011), add that digital
platforms are characterized by network effects and include Desktops, PDAs, network
Switches, Multimedia, and mobile devices like smartphones and ERP systems to link
the demand side to the supply side of businesses. Digital marketing is characterized
by various strategies which all operate electronically. Online advertising is a very
significant portion of digital marketing through which companies convey messages
about their products or services (Ryan & Jones, 2009). Social networking sites such as
Twitter, LinkedIn, Myspace and Facebook have proved to be popular online activities
in relation to time spent (Nielsen, 2010). According to (Pradiptarini, 2011), Facebook
is the most common social media site followed by Twitter, LinkedIn, MySpace and
YouTube in popularity. Social media which is user-generated communication
represents a widespread source of information (Michaelidou, 2011) and create
empowered clients who are more influenced by other clients than by advertising
(Leeflang et al., 2014). Social media has changed the strategies and tools firms use to
communicate, emphasizing that information control lies with the clients rather than
the seller (Mangold & Faulds, 2009). Social media also generates incredible increase
in client insights, including how they interrelate with each other and the products and
services they consume. The widespread acceptance of digital marketing practices
have greatly contributed to the personalization of marketing where commercial
entities progressively links with individual clients and users and gaining feedback on
a one-to-one basis. Social media has therefore, become significant as a means of
internet marketing given its wider adoption. The effectiveness of social media
marketing is highly subjective to content quality; involvement; and integration with
the other media platforms (Pradiptarini, 2011) and there is mixed indications of
correlation between a company’s social media activities and its performances.
Through social media platforms, companies can promote events concerning their
products and services, run promotions and explore new opportunities to increase
awareness and visibility of their brand and share information with their clients.
Mobile application for marketing implies the use of the portable media as a means of

marketing communications (Bauer, Barnes, Reichardt & Neumann 2005). Mobile

applications offer several networks to reach customers through various strategies
ranging 20from short messaging services, pictures, videos and multimedia messaging
service to the mobile Internet with short messaging being the most popular and highly
effective for generating brand awareness. Mobile applications are designed for quick
messaging and are used for reminders, updates and confirmations. The remarkable
success of SMS is credited to its strategic features, such as ease of use, low cost,
message forwarding ability, and unobtrusive nature (Doyle 2011).

Websites generates new ways of communication, cooperation and content sharing

(Enders, Denker, Hungenberg & Mauch 2008). Most organizations have websites that
define their core business activities and detailing the products and services they offer.
However, the numerous websites on the internet make it challenging to market
products on the websites and therefore SEO strategy is extensively used to improve
the visibility and thus the volume and quality of traffic to a firm’s website (Khraim
2015). Firms with higher rankings for their websites appear at the top of the search
result page, and more frequently, the greater the likelihood that potential customers
will visit these sites. SEO focuses on image search, local search, video search, news
search and industry-specific vertical searches. SEO provides a variety of strategy
including increasing links from other websites to the firm’s webpages, editing the
content of the website and restructuring contents of a company’s website.
Effectiveness of a primary website in attracting visitors is improved by supplementary
activities like social network activities, frequent actualization of website and creation
of secondary websites linked to it (Khraim 2015).

E-mail is one of exciting innovative strategies facilitating interactive marketing.

Kinnard (2000) define e-mail marketing as the act of conveying marketing
communication to recipients who primarily request for it while Roberts and Berger
(1999) define e mail marketing as information focussed interpersonal marketing
practise that takes place in a context of accountability for the privacy of the
customers. These definitions show a clear difference between permission based,
focused e-mail marketing and spontaneous, and targeted mass mailings. Email
Marketing involves transmitting product information via email to the existing and
potential customers. It involves use of email to send advertisements and request for
sales while building trust and loyalty with current customers to encourage repeat
business and also acquiring new customers. E-mail marketing is a form of direct and
interactive marketing strategy which is used in acquiring and retaining customers
analyzing individual customers (Tapp, 2000). E mail marketing is considered cost-
effective favourite method of communication for many people and can be customized
for each recipient. It allows easy interaction, it is traceable and its effects readily
measured. Performance of e mail marketing is enhanced by seeking the clients’
permission to be contacted by the marketer at any time through e-mails (MacPherson,
2001)

2.4 Organizational Performance.

Lebans and Euske (2006) define performance as comprising of monetary and non
monetary pointers which offer evidence on the degree of attainment of the
organization’s objective. Lebas (1995), explain that performance should be supported
by philosophies of performance management which include the validity of cause-
effect relationship among variables. Performance measurement has been limited to a
financial perspective, ensuing to various restrictions like emphasis on the internal
factors of the company and delayed accessibility of performance-related information.
To overcome these restrictions performance has to be measured as a multidimensional
subject. Good organizational performance can be attained by improving product
quality, improving production efficiency, and better responsiveness to clients’ needs.

There are other factors that determine organization’s performance besides money.
From the various literature review, performance may be summed as valuable
contributions to attain the objectives of a firm in a given time period (Anthony, 1965).
Performance of an organization can thus be evaluated in several dimensions namely a
company’s productivity, its efficiency, the profitability, and lastly its market share.
Performance measurement involves identification, monitoring and communication of
the results using performance indicators (Brudan, 2010). Marketing performance
management include: marketing planning, implementing, and evaluating marketing
results for performance improvement. In the horticulture sector several factors add to
the total financial performance of the firm. The product quality, productivity aspects,
the operating costs, marketing prowess of the firms and tax implications all have a
bearing on performance.

2.5 Digital marketing and organizational performance

Digital marketing can be used to enhance a firm’s marketing communication mix.

Digital marketing enables firms to interact with its customers and has the ability to
positively influence on the performance of business (Kariuki et al, 2014). With
heightened competition marketers are compelled to find alternative ways to appeal to
and retain customers. Marketing activities employed by businesses are expected to
add value and deliver on the goals of the organizations. Kimani (2015), found out that
social media influences consumer awareness, information acquisition and buying
behaviour thus an effective tool in brand monitoring. The use of digital marketing
impacts positively on performance of small and medium enterprises by harmonizing
their clients and business processes with technology to achieve profitable growth
(Nyawira & Karugu, 2015). According to Kithinji (2014), Digital marketing enables
firms’ reach to new customers, enhance brand awareness and mitigate clients
complains thereby improving on profitability. Websites play critical role in the
implementation of digital marketing and (Mwarania, 2012), connects this to increase
in market share and profitability of tour firms in Kenya.

In the insurance sector, the use of digital marketing platforms in advertising,

promotion, and responding to customer queries has led to higher insurance policy
sales. Digital marketing create brand and products awareness, leading to better sales
networks and market share. The website marketing has been indicated to assist
insurance firms in collecting information on the prospective clients visiting their
websites (Hossinpour, Hasanzade, & Feizi 2014).