Abstract:
The general objective of this study was to conduct an assessment of market growth strategies in the local financial institution using the case of Kenya Commercial Bank. The study was guided the following research objectives, effect of Market Penetration as a growth strategy, effect of product development as a market growth strategy; effect of market development as a market growth strategy, effect of diversification as a market growth strategy. Descriptive research design was used in the study. The total population of the study was 163 which included 157 Branch Managers 6 Strategic Managers from head office who are directly involved with strategic development process and implementation. This study adopted simple random sampling technique. The data was collected using questionnaires. Data analysis involved descriptive statistics to determine frequency distribution for a demographic profile of participants. The demographic data was tabulated using frequency and percentages. Simple regression analysis of each variable was used. The data was presented in the form of tables and figures according to the research questions by the help of Statistical Package for Social Sciences (SPPS) software. From the findings, the effect of market penetration was significant and its coefficient was positive indicating that the more KCB engages in market penetration strategies the more they achieve market growth. There was a significant and strong correlation between product development and growth strategy reported. This suggests that KCB should continue to focus their product development strategies because there is an appreciable effect on the bank's growths strategy. KCB should continue to focus their market development strategies as there was a significant and strong correlation between market development and growth strategy. The effect of market development was significant and its coefficient was mid positive indicating that the more KCB engages in market development strategies the more they achieve market growth. The effect of market diversification was significant and its coefficient was positive indicating that the more KCB engages in market diversification strategies the more they achieve market growth. It was clear that market penetration has the most effect followed by product development, market diversification and then by market development. The study recommends that small and medium commercial banks should engage more in market penetration strategy in order to enable them achieve market growth. The market penetration will be achieved through direct sales, promotions, and advertisements. Banks should also engage in public relations exercises as this will help them attract a certain clientele. PR exercise would take the form of dinner galas, sport tournaments such as sponsoring golf. This study also recommends that financial institutions should continuously offer products that adapt to the needs and want of the target customers. For financial institutions to remain competitive in the market, they should quickly match their competitors' innovations by focusing on brand image, quality, customer expectation and technology advancement as product development strategies. Although much research has gone into understanding market growth strategies, mainly in manufacturing industries, financial service researchers have done little on this subject, due to the limited sample size and the lack of consistent financial data available, especially in the financial sector. Hence, the researcher suggests further research should be done on how market growth strategies influence performance and stability of financial institutions.