EFFECTS OF MARKETING MIX STRATEGIES ON THE PRODUCTION OF MACADAMIA NUTS BY SMALL-SCALE FARMERS IN KIRINYAGA COUNTY, KENYA

Abstract

Macadamia farming plays a vital role in Kenya’s agricultural sector, providing income and livelihood opportunities for thousands of small-scale farmers, particularly in the highlands region. Globally, it also serves as an important source of income for producers in other macadamia producing areas. The highland regions around Mount Kenya, comprising of Kiambu, Kirinyaga, Meru, Murang’a and Nyeri counties, are the biggest producers of macadamia nuts in Kenya However, the sector is marked by low average yields with trees producing only 50% of the crop potential. Although Kirinyaga County is one of the main producers, in 2017, it recorded the least contribution of 4.4 % to the national production of macadamia nuts. This reflects a central problem of underproduction in a high-potential area, signaling unexploited opportunities for increasing macadamia nuts output. Thus, the existing potential for production of macadamia nuts in Kirinyaga County as well as in Kenya remains unexploited. Therefore, this study sought to establish the effect of marketing mix strategies on the production of macadamia nuts by small-scale farmers in Kirinyaga County, Kenya. The objectives of the study were; to analyze the effect of product strategy, assess the effect of price strategy; examine the effect of place strategy; determine the effect of promotion strategy on production of macadamia nuts; and to assess the moderating effect of access to financial credit on the relationship between the product, price, place and promotion strategys and the production of macadamia nuts by small-scale farmers in Kirinyaga County. The study is anchored on the marketing mix theory, which argues that successful positioning and performance of a product or service depend on how well these four elements are coordinated and aligned with customer needs and market dynamics. In this context, the theory relates to how marketing mix strategies such as product, pricing, place and promotion influence farmers production behavior and decisions. The study is also supported by the production theory, cobweb theory, the agricultural location theory and the diffusion of innovation theory. The study adopted a descriptive survey design. The multistage sampling technique was used to select a sample of 381 respondents from a population of 8,004 small-scale farmers. Data was collected using a structured questionnaire which was self-administered through the drop-and-pick method. The research instrument demonstrated good quality measures, achieving a content validity index (CVI) of 0.86 and an overall reliability coefficient of α = 0.844. Data was cleaned by identifying missing values, inconsistencies, and outliers followed by cross-validation with original source records using frequency distributions, range validation, and logical consistency checks with SPSS version 26. Data was analyzed using descriptive statistics and multiple regression and simple and multiple linear regression models were used to measure the influence of each independent variable on the output variable and the relationship between the independent variables (product, price, place and promotion) and the dependent variable (production of macadamia nuts) respectively. The ordinary least square assumptions in respect to linearity, normality, multi-collinearity and homoscedasticity were tested and confirmed before conducting regression analysis. The analyzed data was presented in the form of tables and figures. The null hypotheses that, there is no significant effect of Product strategy, no significant effect of price strategy, no significant effect of place strategy and no significant effect of promotion strategy on the production of macadamia nuts; and access to financial credit has no significant moderating effect on the relationship between the product, price, place, promotion and the production of macadamia nuts by small-scale farmers in Kirinyaga County were rejected at p-value .000. The findings of the study indicated that there is a positive and statistically significant relationship between product strategy and production of macadamia nuts by small-scale farmers (r = 0.365, p = 0.000). Correlation results also showed a positive and statistically significant relationship between price strategy and production of macadamia nuts (r = 0.379, p = 0.000). The correlation between place strategy and production of macadamia nuts was negative and statistically significant (r = -0.324, p = 0.000), while the correlation between promotion strategy and production of macadamia nuts was also negative and statistically significant (r = -0.334, p = 0.000). The study concluded that marketing mix strategies have a statistically significant effect on production of macadamia nuts by small-scale farmers in Kirinyaga County. The study recommends that farmers increase the use of factor inputs to improve on yields per tree, collaboration between the government, processors and farmers to craft a mutually benefiting pricing strategy, building capacity and capability of the extension service. The results of the study will contribute to greater understanding of the various marketing mix factors that lead to increased crop production.