MARKETING STRATEGIES, INDUSTRY COMPETITION AND EXPORT PERFORMANCE OF FRESH PRODUCE FIRMS IN KENYA

Despite the increasing number of firms pursuing the export market, little is known about the moderating role of industry competition in the marketing strategy and export performance link. The majority of the studies have focused solely on the direct relationships between two variables at a time and overlooked potential moderating factors that could influence export performance. To address this gap in the literature, this study solicited responses from 100 fresh produce export firms. Primary data was collected using a structured questionnaire. The study's overall objective was to determine the influence of industry competition on the relationship between marketing strategies and the export performance of fresh produce firms in Kenya. The specific objectives were to establish the impact of product strategies on export performance of fresh produce firms; assess the effect of price strategies on export performance of fresh produce firms; examine the effect of promotion strategies on export performance of fresh produce firms; examine the influence of place strategies on export performance and to determine the moderating role of industry competition on the relationship between marketing strategies and export performance of fresh produce firms. The study outcome revealed that industry competition influenced export performance through marketing strategies. The findings from the study build on the industrial organization's economic theory, which postulates that an industry's long-term profitability and attractiveness can be explained by the strength of all five forces together. Likewise, empirical findings recommend that managers should identify opportunities and threats within the industry and subsequently use this information to formulate robust marketing strategies.


INTRODUCTION
Technological advances, convergence of customer preferences, and intense competition have influenced many firms to seek business opportunities beyond their traditional domestic markets (Chang & Fang, 2015). For local firms, an increase in export performance boosts business growth and production capacity and protects the firm's existing operations against foreign competitors. To policymakers, on the other hand, it allows the accumulation of foreign exchange, job creation and enhances national wealth (Chen, Sousa & He, 2016). In spite of the inherent benefits that accompany export business, many firms are still reluctant to pursue international markets, and when they do, they often struggle to achieve satisfactory performance (Morgan, Vorhies & Schlegelmilch, 2006).
Studies on export performance typically propose a direct relationship between marketing strategy and export performance (Sezgin, Uray & Burnaz, 2015). However, this study proposes that exporting firms do not rely exclusively on marketing strategies to achieve success in export markets. By analyzing industry competition, firms can identify possible threats and opportunities that exporters must respond to when designing marketing strategies (Vorhies, Orr & Bush, 2011). The possibility of a moderating role is consistent with the industrial organization economic theory assumptions that a competitive environment moderates the effectiveness of marketing strategies (Auh & Menguc, 2005;Chan, Chan, & Wang, 2012). In the export performance literature, a vast majority of research efforts have identified factors that have a direct influence on performance and neglected the role of moderating variables (Samiee & Chirapanda, 2019). For this reason, empirical and theoretical knowledge in this area remains scarce and offers limited insights to practitioners concerned with export performance.
Kenya is fundamentally an agricultural-driven economy, evidenced by its 25% direct contribution to Gross Domestic Product (GDP) and 65% contribution to national exports. Kenya's fresh produce is exported to 147 destinations which represent 77 % of the countries globally (KDLC, 2010). This rapid growth has been attributed to factors such as a reduction in barriers to trade, the launch of direct flights to the USA and the government identifying unexplored markets like China to augment the long-established European Union (EU) market (KNBS, 2018). Although Kenya has been relatively successful in exporting fresh produce, many other African countries have also ventured into the export market, resulting in an increase in the intensity of competition (RSA, 2015a). Consequently, fresh produce firms' viability and survival have become even more challenging. Expansion into foreign markets is considered an increasingly important policy priority. More specifically, improving the export performance of fresh produce firms results in an increase in employment opportunities and foreign exchange earnings and provides domestic firms with realistic growth opportunities. To inform policy, prior research on export performance tends to generalize findings obtained from developed economies. However, the significance of these findings for firms operating in developing countries could be inadequate in explaining performance. In light of these considerations, this study examines the moderating role of industry competition within the context of a developing economy such as Kenya.
This study makes three major contributions. First, this study builds on the industrial organization economic theory as well as prior export performance research. Most of the studies conducted in export marketing literature have examined only two variables at a time and in industries different from the fresh produce industry. Therefore, findings from this study will provide empirical evidence on how to develop and implement competitive marketing strategies for the export market. This research is, hence, a response to calls for additional empirical research in a relatively unexplored area in export performance literature.
The fresh produce industry presents enormous opportunities for job creation, and foreign exchange earnings, thereby enhancing prosperity for the Kenyan population. Given the significance of fresh produce firms to the Kenyan economy, the outcome of this study is expected to inform public policymakers on how to develop innovative interventions that will spur growth in export markets while taking into account the competitive nature of the fresh produce Industry.
This study proposes marketing strategies and industry competition to influence export performance. Therefore, the conclusions derived from this study will enable managers, particularly within the fresh produce industry, to develop marketing strategies that will promote superior performance in the international markets. By considering industry competition as the moderating variable, organizations should not only focus on developing marketing strategies but on how to effectively utilize the competitive environment to attain success in the international market.

Marketing Strategies and Export Performance
Marketing Strategy, as described by Tikkanen, Kujala and Arrto (2007), is an organized effort through which the firm identifies its target group of customers and thereafter develops a set of market mix variables that allow optimal value creation for its client. Varadarajan (2015) agrees that to create customer value and achieve success in competitive markets, managers use the (4P's) to formulate a response to market forces and develop a statement of the firm's offering. A plethora of past empirical studies acknowledges that marketing strategies play a pivotal role in determining performance (Morgan, Katsikeas & Vorhies, 2012). For this reason, individual elements within marketing strategy need to be addressed in order to investigate their effects on the decision-making process of firms.

Product Strategies and Export Performance
As Kotler and Armstrong (2014) defined, a product is the portfolio of goods or services for which the consumer is ready to pay at a point in time. Cant and Van Heereden (2013) agree that the role of a product is to satisfy customer needs as a result of its direct use. For purposes of this study, product strategy focuses on, product quality, brand identity, value addition and broad product variety as its attributes. Prior studies have considered product quality as a key driver of export success (Tsvakirai & Mosikari, 2021). For example, an exploratory study by Lages, Lages and Lages (2005b) of Portuguese and British exporting firms revealed that product quality was considered a top determinant of success in the export market.
Similarly, a survey of 1332 Portuguese manufacturing firms by Lages, Silva and Styles (2009) linked product quality to greater sales volume, which translated to superior export performance. Customers have more alternatives in an increasingly global market, resulting in firms' pressure to improve quality and differentiate products to gain a competitive advantage (Calantone & Knight, 2000;Tanrattanaphong, Hu & Gan, 2020). Following this line of thought, this study hypothesized: Hypothesis 1: Product strategies do not have a significant influence on Export Performance.

Price Strategies and Export Performance
Price is described as what a customer is willing to sacrifice to acquire a product or service. It is the only component that brings in revenue and has the highest flexibility (Ritz, 2013;Morgan, Feng, & White, 2018). According to Obadia (2013), pricing products in international markets is becoming increasingly difficult due to competition, lack of clear separation of markets and limited empirical research to guide managers. A case study by Wuollet (2013) of an IT service firm in Finland revealed that pricing strategies influenced export performance. Similarly, Avlonitis and Indounas (2006) collected data from 170 Greece firms operating in six different service sectors. Findings from the study established that pricing was used to attract attention, increase sales, and boost company revenue. These results were, however, confined to the service industry, which displays unique attributes such as perishability, inseparability, heterogeneity, and intangibility. In another study, Achrol and Kotler (1999) established that the link between pricing and performance was not clear since different markets reacted to price differently. The above inconsistent findings reveal that the link between pricing strategy and performance remains unresolved. Hence the following hypothesis is proposed.

Promotion Strategies and Export Performance
Promotion, as Adetayo (2006) described, is a marketing tool used to educate, remind, and persuade consumers about the company and its product offerings. According to Belch and Belch (2003), promotion consists of personal selling, public relations, sales promotion, direct marketing, advertising, events, and sponsorship. Marketers use the promotion to increase the sale and usage of a product/service over a short period by offering more benefits (Kotler, 2010). In this study, attention will be on international trade shows. This is because prior studies on export performance reveal that international trade shows allow immediate sales and reduce buyer uncertainty and cultural differences translating to higher sales (Denis & Depelteau, 1985). In Turkey, Karafakioglu (1986) collected data from 108 manufacturers. Results established that majority of the exporters attempted to identify customers through personal selling and business trips abroad, while advertisement was rarely used. This study was, however, conducted in a developed economy.
Similarly, in the USA, a study by Wilkinson and Brouthers (2000a & b) established that there was a positive link between trade shows and export sales. This study used states as the unit of analysis, while the current study used individual firms. Following this ambiguity in literature, this study hypothesized that.

Distribution (Place) Strategies and Export Performance
Distribution strategy refers to decisions and actions to bring products closer to prospective customers (Palmer, 2011). According to Arnold (2000), distribution either through direct or indirect channels enables export firms to gain substantial market knowledge, access to customers and provide necessary marketing services. In Saudi Arabia, Al-Aali, Lim, Khan, and Khurshid (2013) collected data from 222 export firms. The study findings revealed that distributor support significantly affected export performance. Conversely, a survey of 160 manufacturers by Bello and Gilliland (1987) in the USA established that most manufacturers had terminated their relationship with foreign distributors as they had failed to increase sales. As a result of these mixed findings, the link between distribution strategies and export performance remains unclear. This study hypothesized that Hypothesis 4: Distribution strategies do not have a significant influence on Export Performance.

The Moderating Role of Industry Competition
Industrial Organization Economic Theory suggests that firms within an industry are characterized by perfect competition, similar products or closely related substitutes (Fleisher & Blenkhorn, 2005). Porter (1980) further states that the intensity of competition can be measured using five dimensions: bargaining power of buyers, bargaining power of suppliers, threat of substitute, threat by new entrants, and rivalry amongst competitors (Tavitiyaman, Qu & Zhang, 2011). The collective strength of these forces determines profitability by affecting demand and supply within a particular industry (Ferguson & Ferguson, 1994). Prior studies have established a direct relationship between industry competition and Performance (Madsen 1989;Chan, Chan & Wang, 2012). However, the moderating role of industry competition on the link between marketing strategies and export performance has received limited empirical attention. This research contends that industry competition is central to reinforcing the link between marketing strategies and export performance. Consequently, this study hypothesized that:

RESEARCH METHODOLOGY
The target population consisted of 100 fresh produce firms drawn from a database compiled by the Fresh Produce Association of Kenya (FPEAK). This is a legal entity that represents growers, exporters, and service providers in the horticulture industry in Kenya. Primary data on the key study variables, namely, Marketing Strategies, Industry Competition and Export Performance, was obtained using a semi-structured questionnaire adopted from previous empirical studies. Owing to the small number of fresh produce firms, questionnaires were emailed to all 100 exporters. According to Israel (1992), a census study is preferred when the population comprises of 200 or less members.
To maximize support from the target organizations, the researcher made follow-up telephone calls and personal visits to the respondent organization. Content validity was tested by randomly selecting ten fresh produce firms. Based on feedback, some of the test questions were modified. Burns and Bush (2005) state that 5-10 respondents are sufficient to identify problems within the questionnaire. Financial information was obtained using perceptual measures rather than actual data. This is because most firms were privately held and considered financial data to be confidential. Collecting absolute financial data has often been quoted as one of the major challenges in empirical studies specific to export performance (Wolff & Pet, 2006). In total, 73 questionnaires were returned; of these, 69 were used in the study resulting in a response rate 7 of 76.7%. This response rate is comparable with other studies on export performance (Brouthers & Nakos, 2005;Julian & Ahmed, 2005). The key informants were export managers, managing directors and export supervisors who were primarily responsible for export operations. This was influenced by their roles and involvement in export business within the firms (Leonidou, Palihawadana, & Theodosiou, 2011). A filtering question that noted the respondent's position within the organization was included to monitor this.

Marketing Strategies
The marketing strategies variable was operationalized with 28 items adapted from previous studies Morgan, Katsikeas & Vorhies. 2012). A five-point scale ranging from "not at all" to "very large extent" was employed. To measure the construct validity, responses from the 28 items were factor analyzed. The final principal factor analysis (PFA) with varimax rotation revealed that eight items had factor loadings below 0.50 and were therefore eliminated. Cronbach's alpha reliability was deemed acceptable at 0.710. Table 1.0 provides a summary of the findings. Tables 1a and 1b present the factor loadings for the rotated component matrix. The values ranged from the highest 0.872 to the lowest 0.579. Only items with factor loadings above 0.5 were used to evaluate marketing strategies. Consequently, only 20 items were loaded (Meyer, Gamst & Guarino, 2013).

Industry Competition
Industry Competition is the moderating variable and was conceptualized using the INDUSTRUCT scale, which comprises the five competitive forces (Pecotich, Hattie, & Low, 1999;Porter, 1980). Responses were measured on a five-point Likert scale ranging from "not at all" to "very large extent." To measure the construct validity, responses from the 29 items were factor analyzed to explore the Cronbach's alpha reliability was deemed acceptable at 0.712. Table 2, below, hence presents a summary of the findings. was used as the minimum factor loading criterion, resulting in all the 29 items used to measure industry competition.

Export Performance
Export Performance is the dependent variable and was conceptualized using perceived rather than objective indicators for several reasons. First, the pilot study's findings revealed that most of the firms were privately owned, and the managers were unwilling to disclose actual financial figures. Secondly, subjective indicators were shown to be a useful proxy in measuring export performance (Katsikeas, Leonidou & Morgan, 2000). Three items, namely, return on assets (ROA), export market share and customer retention rate, were adapted from export literature. In particular, respondents were asked to assess the performance of each item in comparison to that of their direct competitors. A five-point scale ranging from "not at all: to "very large extent" was used. A summary of the results is demonstrated in Table 3. The output presented in Table 3 shows a single component solution (loadings .708, .680 and .644, respectively). Principal factor analysis with no rotation was employed on all three items of export performance, which explained 55.883% of the total variance. Cronbach's alpha reliability was deemed acceptable at 0.695; thus, following Meyer, Gamst and Guarino's (2013) recommendations, 0.50 was used as the minimum factor loading criterion, resulting in all the three items being considered significant in evaluating export performance.

Control Variables
Firm size and Export Experience were selected as control variables. Following previous research, size can be seen as a proxy for advantages associated with access to credit, bargaining power, better trained staff, research, and development (Kogan & Tian, 2012). For similar reasons, international experience reduces uncertainty in foreign markets and can therefore constitute an essential source of competitive advantage. In this study, firm size was measured using the number of permanent employees thereafter normalized by calculating the natural log. While the export experience was measured using two dimensions: time and scope, time was computed by calculating years spent conducting export business and then normalized by a natural log. The scope was computed by the number of countries the firm exports to and then normalized by a natural log. The two log values (time, scope) were summed up, and an average was calculated to create the construct export experience. These measures are used in their logarithmic form to cater to significant positive skew (Tabachnik & Fidell, 2001). Given the focus of this study, no hypothesis or potential interrelationships between the control and the core variables were formulated.

DATA ANALYSIS
To test the hypothesis, the hierarchical regression model was adopted. According to Easterby-Smith, Thorpe, and Lowe (2002), hierarchical multiple regression is a model for analysis that involves adding predictor variables in steps to establish whether the addition of a potential moderator has a significant increase in (R squared). In step 1, only the control variables (log of firm size, log of experience) were regressed on the dependent variable (composite scores export performance). In step 2. the independent variables (Product, Price, Promotion and Distribution) were added to the control variables in step 1. The findings in Table 4 reveal that both size and experience and useful in predicting export performance (Model 1). When the independent variables (Product, Price, Place and Promotion) are added, R 2 increases by .054, and the values are significant, indicating that the 4P's are useful when predicting export performance. However, product strategies made the most considerable contribution (.281) while price strategies made the least (.161). Hence the hypotheses H1 to H4 postulate that no significant relationship exists between the 4P's and export performance, and both are rejected.
In literature, it has been suggested that the effectiveness of marketing strategies is contingent on industry competition. The marketing strategy and export performance relationship is moderated by industry competition. To test this hypothesis in the fresh produce context, further analysis is conducted. In step 1, the composite scores of marketing strategies were regressed on export performance. In step 2, composite scores of both marketing strategies and industry competition were regressed on export performance. In step 3, the composite score for the variables marketing strategies, industry competition and the interaction term were regressed on export performance. The interaction term was computed by standardizing the variables marketing strategies and industry competition and subsequently multiplied (Aiken & West, 1991). The results in Table 5 indicate that marketing strategies significantly predicted export performance (Model 1), and hypothesis H1 is therefore rejected. These findings suggest that high levels of marketing strategies are useful in leveraging export performance. When Industry competition was added in Model 2, R 2 increased by 0.89, suggesting both marketing strategies and industry competition were useful predictors of export performance amongst fresh produce firms in Kenya.
The interaction term (MS *IC) was added in model 3, R 2 increased by .046, and the beta value was statistically significant; however, there is a negative association between the interaction term and export performance. Consequently, the null hypothesis was therefore rejected in favor of the alternative hypothesis, which states that the industry competition significantly moderates the association between marketing strategies and export performance.

DISCUSSION AND CONCLUSION
The output in table 6.0 provides a summary of the hypothesis results. H1 established that the relationship between product strategies and export performance was positive and significant. The findings also suggest that amongst the 4P's, product strategies made the most significant contribution to export performance. In this respect, these results signal an important message to exporters of fresh produce firms that successful firms pay close attention to product quality. Another finding is that firms that use value addition as a competitive tool gain a competitive advantage over rivals. These findings are consistent with arguments provided by (Lages, Silva & Styles, 2009;Tsvakirai & Mosikari, 2021).
The second hypothesis revealed that the relationship between pricing strategy and export performance was positive and significant. However, the results from the regression analysis revealed that amongst the four elements of marketing, pricing strategies made the least contribution to export performance. These findings are somehow surprising, but these could be due to the availability of suppliers (alternatives) in the export market. A signal that the fresh produce industry is increasingly becoming a competitive market.
Another significant finding was that the link between distribution strategies and export performance was positive and significant. The results from the regression analysis revealed that distribution strategy was the second most significant predictor of export performance. A possible explanation would be due to the product's perishable nature, as the success of fresh produce firms depends on the supplier's ability to respond to emerging requirements in the export markets. A case in point is the increasing demand for healthy living among buyers of fresh produce and the rising demand for convenience shopping amongst buyers.
The relationship between promotion strategies and export performance was found to be positive and significant. Results from the study reveal that to achieve success in the export market; fresh produce firms need to be proactive and participate in trade fairs. This explanation is in line with previous findings that have associated trade fairs and trade shows as one of the most effective when undertaking promotion strategies (Madsen, 1987).
Evidence suggests that both export performance and the effectiveness of marketing strategies are influenced by the intensity of competition in foreign markets. For example, product quality and value addition are likely to be crucial in highly competitive industries. Relating to the moderating role of industry competition, the findings obtained in this study enrich current literature on export performance by highlighting the importance of industry competition when developing marketing strategies for the export market. These findings align with those of Ong, Ismail, and Yeap (2018), who reported that industry competition moderates the competitive advantage and firm performance link in multiple ways. The significant but negative interaction of industry competition on the marketing strategy and export performance link confirmed that when industry competition was high, developing and implementing competitive marketing strategies became an essential source of competitive advantage for superior export performance.

Theoretical Implications
First, the empirical findings demonstrate that marketing strategies undertaken by fresh produce firms had a positive and significant link with export performance. These results reinforce the assumption that the 4P's, namely, produce, price promotion and distribution, spell out key decision areas that managers examine to satisfy customer needs and meet company objectives. However, product and place strategies made the highest contribution to export performance.
Secondly, the results of this study advance understanding of the industrial organization economic theory by providing empirical support on the moderating role of industry competition in export markets. Most of the studies conducted in export marketing literature have examined only two variables with marketing strategy as the predictor variable and export performance as the outcome variable.

Implications to Policy
The fresh produce industry has emerged as one of the fastest growing within the agricultural sector.
In addition to providing food security, improved nutrition and foreign exchange earnings, the industry plays a vital role in generating employment opportunities (Agricultural Sector Coordination Unit, 2011). Empirical findings provide legitimacy that stakeholders need to enact policies and statutory bodies that collaborate with the fresh produce firms to improve productivity through the provision of seeds, price subsidies, research, and facilitating the export of diversified fresh produce to the export markets.
In addition, this study investigates the role that industry competition has in leveraging export performance. At the practitioner level, policy makers should push for budgetary allocations to enhance the use of training programs and joint ventures between fresh produce firm owners and foreign buyers with the aim of reducing the high level of uncertainty associated with marketing decisions.

Implications to Marketing Practice
Findings from this study have significant practical consequences for managers. First, the results confirmed that marketing strategies had a significant and positive influence on export performance.
Product strategy was said to be the most significant element when developing and implementing the marketing mix strategy; hence, managers should emphasize products to remain competitive.
Similarly, results suggest that firms spend more on marketing strategies as industry competition increases. Therefore, it is imperative for managers to identify opportunities and threats within the industry and subsequently use this information to formulate a marketing strategy.

SUGGESTIONS FOR FUTURE RESEARCH
This empirical study was a cross-sectional research design, where the variables of marketing strategy, firm characteristics, industry competition and export performance were examined during a single time period. Given that the international environment is turbulent over a given time, a longitudinal study may provide a more in-depth understanding of the dynamic aspects of export performance.
Secondly, although this study adds to export marketing literature in the developing countries. This study focused on the role of marketing strategies in achieving success in the goods industries. Due to the nature of the product, it was not possible to extrapolate findings to the service industry.