Effect of strategic Internal marketing on performance of five Star Hotels In Nairobi County

Abstract

The hotels invest in addressing the concerns of their stakeholders such as customers, investors and suppliers to the exclusion of the internal customers or rather employees; therefore, there is little emphasis on internal marketing which contribute to performance of hotels. The study sought to examine the effects of strategic internal marketing on performance of five-star hotels in Nairobi City County. The study was anchored on social exchange theory and balanced score card and adopted concurrent triangulation research design. The target population was 1181 employees and 10 managers working in 10 five-star hotels in Nairobi, out of which 290 employees and 10 managers formed the sample size. A census of the 10 hotels were conducted while systematic random sampling was used to select employees and purposive sampling for the hotel managers. Questionnaires were used to collect quantitative data, which was analysing using descriptive and multiple linear regression. Interviews were used to collect qualitative data from hotel managers, which was analysed using thematic analysis method. The regression attained R2= 0.353 which implies strategic internal marketing explains 35.3% of the variation in performance. The interviewees acknowledged that strategic internal marketing enhanced hotel performance. The results revealed that strategic rewards (β=0.184; t=2.416, p=.016) and internal communication (β=0.675; t=7.715, p=0.001) had a positive and significant effect on performance while training (β=0.057; t=0.815, p=0.416) had no significant effect on performance. The interviewed managers implored the importance of employee recognition, fair compensation, sharing information, feedback, updates, teamwork and capacity building to performance. The study concluded that strategic rewards and internal communication affect performance while training does not. The study recommended the use of both financial and non financial strategic rewards, vertical and horizontal communication and feedback mechanism.