FACTORS AFFECTING THE ADOPTION OF E-MARKETING AMONG SMEs;

CASE STUDY OF SELECTED SMEs IN THE KUMASI METROPOLIS,

ASHANTI REGION.

By

KWADWO ADU GYAMFI

(PG 9643713)

A thesis submitted to the K.N.U.S.T School of business, Kwame Nkrumah

University of Science and Technology, Kumasi, in partial fulfillment of the

requirements for the degree of

MASTER OF BUSINESS ADMINISTRATION

(MARKETING OPTION)

OCTOBER 2015

i
 DECLARATION

I hereby declare that this submission is my own work towards the Masters of Business

Administration and that, to the best of my knowledge, it contains no material previously

published by another person nor material which has been accepted for the award of any

other degree of the University except where due acknowledgement has been made in the

text.

Kwadwo Adu Gyamfi …………………………. ………………………….

(Student Name) Signature Date

Certified by:

Dr. Bylon Bamfo …………………………. ………………………….

(Supervisor Name) Signature Date

Dr. Ahmed Agyapong …………………………. ………………………….

Head of Department Signature Date

ii
 DEDICATION

To the pillar of my life, My Mother,

Mrs. Vesta Adu Gyamfi

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 ACKNOWLEDGEMENT

I am exceedingly grateful to the almighty God by whose grace I have been able to

complete this project. I wish to express my indebtedness to Dr. Bylon who painstakingly

supervised this thesis and offered very useful criticisms and suggestions to make this

study a success. Many thanks also go to the management and owners of the enterprises

who assisted in gathering the needed information to accomplish this study.

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 ABSTRACT

Over the years, the internet has steadily become an extremely relevant marketing tool

for businesses around the globe including SMEs. Recent surveys have focused on the

adoption of E-Marketing in both developed and developing countries. This study was

conducted to investigate the factors that affect the adoption of E-marketing among small

and medium enterprises. Its main objectives were to identify the various factors

affecting the decision by SMEs owners and managers to adopt the technology or not. In

addition, to ascertain the level to which each factor influences their decisions to adopt

the technology. Lastly, the study aimed to find out the extent to which SMEs have

adopted e-marketing in their operations. Quantitative approach was used to determine

the magnitude of each factor in influencing adoption of E-Marketing among SMEs. A

qualitative approach was useful to provide the researcher with perspective. The findings

of this study do provide a basic support for the inadequate activity of SMEs with

concern to E-Marketing. The study can therefore conclude that the main factors

inhibiting the adoption of electronic marketing among SMEs in Kumasi are:

technological incompatibility with target markets; lack of knowledge; stakeholder‟s

unreadiness; technology disorientation as well as perception. These findings of the study

indeed concur with various studies that argue that the non-adoption of e-marketing is

multi-dimensional in its causality and it‟s largely dependent on the business sector under

investigation.

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 TABLE OF CONTENTS

DECLARATION ...................................................................................................................... i
DEDICATION ........................................................................................................................ iii
ACKNOWLEDGEMENT ..................................................................................................... iv
ABSTRACT ............................................................................................................................. v
TABLE OF CONTENTS ....................................................................................................... vi
LIST OF TABLES .................................................................................................................. x
LIST OF FIGURES ............................................................................................................... xi

CHAPTER ONE ..................................................................................................................... 1

INTRODUCTION ................................................................................................................... 1
1.1 Background of the Study ............................................................................................. 1
1.2 Problem Statement ....................................................................................................... 3
1.3 Research Objectives ..................................................................................................... 5
1.4 Research Questions ...................................................................................................... 5
1.5 Scope of Study ............................................................................................................. 5
1.6 Research Methodology ................................................................................................ 6
1.7 Justification of Study ................................................................................................... 7
1.8 Organization of Study .................................................................................................. 7

CHAPTER TWO .................................................................................................................... 8

LITERATURE REVIEW....................................................................................................... 8
2.1 Introduction .................................................................................................................. 8
2.2 An Overview of ICT Adoption among SMEs ............................................................. 8
2.3 A Brief History of E-Marketing ................................................................................... 9
2.4 Benefits of E-Marketing to SMEs.............................................................................. 10
2.5 SMEs Readiness for E-Marketing ............................................................................. 11
2.6 E-Marketing Adoption Factors in SMEs ................................................................... 13
2.6.1 Individual Factors ................................................................................................... 13
2.6.1.1 Characteristics of the Owner. ............................................................................... 14
2.6.1.2 Level of Education ............................................................................................... 14

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 2.6.1.3 Level of ICT and E-Marketing Knowledge ......................................................... 15
2.6.1.4 Social and Cultural Influences ............................................................................. 16
2.6.2 Organizational Factors ............................................................................................ 16
2.6.2.1 Security, Trust, and Privacy Concerns ................................................................. 16
2.6.2.2 Financial Ability and Cost Implications .............................................................. 18
2.6.2.3 Size of the Organization....................................................................................... 18
2.6.2.4 Perceived benefits of ICT .................................................................................... 18
2.6.2.5 Organizational Culture ......................................................................................... 19
2.6.3 Technological Factors ............................................................................................. 20
2.6.3.1 Availability and Slow Speed of Internet .............................................................. 20
2.6.3.2 Complexity of Technology .................................................................................. 20
2.6.3.3 Lack of Payment Facilities ................................................................................... 21
2.6.3.4 Lack of Reliable Power Supply ........................................................................... 21
2.6.3.5 Language Barrier.................................................................................................. 21
2.6.3.6 Lack of Internet Address space ............................................................................ 22
2.6.4 Environmental Factors ............................................................................................ 22
2.6.4.1 Government Support ............................................................................................ 22
2.6.4.2 Business Partner Affiliation ................................................................................. 23
2.6.4.3 The Nature and Characteristic of Value Chain .................................................... 23
2.6.4.4 Economic and Political Instability and Human Rights Issues ............................. 23
2.6.4.5 Natural Disasters, Earth-quakes&Floods ............................................................. 24
2.6.4.6 Business Culture .................................................................................................. 24
2.6.4.7 Macro-Economic Policies .................................................................................... 24
2.6.5The Interaction of Factors and the Extent of E-Marketing Adoption ...................... 24
2.7 E-Marketing Development in Organizations ............................................................. 25
2.7.1 Growth Stages ......................................................................................................... 25

CHAPTER THREE .............................................................................................................. 31

METHODOLOGY................................................................................................................ 31
3.1 Introduction ................................................................................................................ 31
3.2 Research Paradigm ..................................................................................................... 31

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 3.3 Purpose of the study ................................................................................................... 32
3.4Sampling procedures ................................................................................................... 34
3.4.1 The population and sample ..................................................................................... 34
3.4.2 The sampling technique .......................................................................................... 34
3.5 Data collection methods ............................................................................................. 35
3.6 Data Analysis ............................................................................................................. 36
3.7Quality of the research ................................................................................................ 37
3.8 Research ethics and limitations .................................................................................. 38

CHAPTER FOUR ................................................................................................................. 39

RESULTS, ANALYSIS AND DISCUSSIONS ................................................................... 39
4.1 Introduction ................................................................................................................ 39
4.2 How SMEs Defined Internet Marketing .................................................................... 39
4.3 What factors affect the decision to adopt E-Marketing ............................................. 40
4.4 Extent of Internet Marketing Utilization .................................................................... 40
4.5 Company Profile of SMEs ......................................................................................... 40
4.6 The Extent of E-Marketing Adoption among SMEs ................................................. 46
4.6.1 Knowledge and Existence of E-Marketing in the Business Activities of SMEs .... 46
4.6.2 Extent of E-marketing Adoption ............................................................................. 47
4.7 Factors that affect the Adoption of E-marketing among SMEs ................................. 48
4.8 Barriers to E-Marketing Adoption among SMEs ...................................................... 51

CHAPTER FIVE ................................................................................................................... 54

SUMMARY, CONCLUSIONS AND RECOMMENDATIONS ...................................... 54
5.1 Introduction ................................................................................................................ 54
5.2 Summary .................................................................................................................... 54
5.3 Key findings ............................................................................................................... 55
5.3.1 The Extent of e-marketing adoption ....................................................................... 55
5.3.2 Factors that affect the adoption of e-marketing among SMEs ............................... 55
5.3.3 Barriers to e-marketing adoption among SMEs ...................................................... 56
5.4 Conclusion ................................................................................................................. 56

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 5.5 Recommendation ....................................................................................................... 57
5.5.1 Areas of further studies ........................................................................................... 58

REFERENCES ...................................................................................................................... 59
APPENDIX ............................................................................................................................ 69

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 LIST OF TABLES

Table 4.1 Knowledge of e-marketing in the Business Process of SMEs ........................ 46

Table 4.2 Initiator of E-Marketing among SMEs ........................................................... 47

Table 4.3 The Extent of E-marketing Adoption by SMEs .............................................. 47

Table 4.5 Barriers to E-marketing Adoption................................................................... 52

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 LIST OF FIGURES

Figure 2.1: DTI Adoption ladder UK online (Source: Martin and Matlay, 2001) .................. 27

Figure 4.1 Nature of SMEs in Kumasi (Source: Field Data, 2015) ........................................ 41

Figure 4.2 Age Distribution of Owners of SMEs (Source: Field Data, 2015) ........................ 42

Figure 4.3 Educational Level of Owners of SMEs (Source: Field Data, 2015)...................... 43

Figure 4.4 Number of Employees of SMEs (Source: Field Data, 2015) ................................ 44

Figure 4.5 Scope of SMEs Business Activities (Source: Field Data, 2015) ........................... 45

Figure 4.6 Registered Businesses (Source: Field Data, 2015) ............................................... 45

Figure 4.7 E–Marketing adoption factors (Source: Field Data, 2015) ................................... 50

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 CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

The definition for SMEs varies depending on the country even though attempts have

been made to fashion out a universally acceptable one. For instance, an enterprise with

an employee headcount of less than 250 and a turnover (in Euro terms) of about €50m is

considered medium sized, and a headcount of less than 50 with a turnover of €10m or

less is considered small scale. While an enterprise with less than 10 employees and a

turnover of €2m is considered a micro enterprise by the European commission (2003).

In Ghana however, the definition of SMEs borders on the number of employees the

enterprise has. The application of this definition raises controversy due to the various

precincts and limitations used by different official records of the country

(Dalitso&Quartey, 2000).

Small businesses are defined by the Ghana Statistical Service (GSS) as an enterprise

employing 10 persons or less. Those that employ 10 people or more are classified as

Medium and Large enterprises. Alternately, the National Board for Small Scale

Industries (NBSSI) in Ghana utilized both the „fixed asset base and the number of

workers employed‟ criteria to define SMEs. According to the NBSSI, enterprises less

than 10 workers, has plant and machinery (excluding land, buildings and vehicles) and

not exceeding 10 million Cedis (US$ 9506, using 1994 exchange rate) are considered as

Small Scale Enterprises (Nkuah, Tanyeh&Gaeten, 2013).

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The operational definition adopted for this study is the one offered by the Ghana

statistical service. Hence, SMEs are enterprises that employ 10 people or more. The

choice of this definition reflects accurately what the researcher as being the situation in

Ghana has observed and allows for a wider inclusion of many enterprises in the study. In

addition, Most of the SMEs in the study area do not register their businesses and do not

keep proper records hence factors such as investment level; sales turnover and gross

assets are not used.

E-MARKETING

Like the name suggest, E-Marketing refers to the use of the Internet and digital media

capabilities to facilitate the marketing of products or services. These now ubiquitous

digital technologies are a valuable addition to traditional marketing approaches not

considering the size and nature of the business. E-Marketing is also referred to as online

marketing or web-marketing Internet marketing (I-Marketing) (introduction to E-

Marketing, 2010).

E-Marketing is similar to the traditional ways of marketing but entirely electronic, it

involves the building of a strategy that enables a business to create awareness for its

products and services and channel its communication almost instantaneously to the right

audience. It consists of all activities and processes with the aim of finding, winning,

attracting and retaining customers. What has changed is its wider scope and options as

compared to the usual marketing methods.

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OVERVIEW OF SMEs AND E-MARKETING.

For developing countries like Ghana, the development of small and medium scale

enterprises (SMEs) is vital to the growth of the national economy. For this reason, the

government invests many resources in an effort to promote the sector for national

economic growth. SMEs are considered to be a major employment source for the nation

and contribute significantly to the country‟s productivity and job creation and the overall

national domestic product. Despite all these potentials, the SME sector has failed to

fully incorporate electronic marketing into its mainstream operational setup.

In recent years, ever-increasing number of businesses have been taking advantage of the

Internet and other electronic media in conducting their marketing activities, giving the

chance for Electronic Marketing (as a new marketing phenomenon and philosophy) to

grow in a very dramatic and dynamic way (El-Gohary, 2010).

The conduct of this study is therefore to understand the various factors affecting the

adoption of E-Marketing among small and medium scale enterprises in the developing

context of Ghana.

1.2 Problem Statement

According to a report by the Services Portal of the Government of Ghana, data on small

and medium scale enterprises is not available but statistical data from the Registrar‟s

General Department indicates that an enormous 92% of all registered companies in the

country are SMEs. Villars, (2004) and Hayford (2012) support this. They state that,

SMEs add 70% to the country‟s Gross Domestic Product (GDP) and account for 92% of

businesses in the private sectorofGhana. In addition, statistics from the NBSSI

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corroborates this in their 2012 report when they stated that SMEs constitute about 90%

of the private sector‟s contribution to the GDP of Ghana.

As an enormous element in the economic structure of the nation, the domestic market

has been the main outlet for SMEs in the country. The adoption of E-Marketing offers

SMEs a great opportunity to expand their access on a global scale. Its application in the

SME sector would benefit enterprises in the way they communicate, and how they

achieve their marketing objectives thus improving efficiency of operations. Researches

on several developing countries like Ghana indicate SMEs are slow to adopting internet

marketing compared to their larger competitors (Eshun& Taylor 2009). SME owners

and managers may sometimes adopt E-Marketing in an ad hoc fashion in an attempt to

defend their autonomy in the business (Gilmore, Gallagher & Henry, 2007).

Unfortunately, this reflects the current situation in Ghana even though most SME

owners understand the benefits E-Marketing in improving business practices. The

owners of some SMEs have been relying on traditional means of marketing to achieve

growth and a competitive edge mainly due to the lack of knowledge, limited funds, lack

of skilled staff, and perceived lack of applicability to the business that SME is engaged

in (Acquah, 2012).

The introduction of E-Marketing into the mainstream operations of SMEs can offer

unique opportunities to overcome specific challenges. However, information on E-

Marketing adoption among Ghanaian SMEs is scarce thus; the fundamental problem

motivating this study is the need to understand the factors affecting the adoption of E-

Marketing among SMEs in Ghana.

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1.3 Research Objectives

In a field with insufficient data, this study contributes to the already existing but limited

knowledge in the area of SMEs and E-Marketing. The general objective of this study is

to ascertain the various factors affecting the adoption of E-Marketing among small and

medium scale enterprises. Consequently, the specific objectives of this research are

1. To identify the extent to which E-Marketing has been adopted by SMEs.

2. To identify the various factors affecting the adoption of E-Marketing among

SMEs.

3. To ascertain the extent to which each factor affects E-Marketing adoption.

1.4 Research Questions

With reference to the research objectives stated above, the study intents to find answers

to the following questions:

1. To what extent has SMEs adopted E-Marketing into their marketing activities so

far?

2. What are the various factors affecting the adoption of E-Marketing among

SMEs?

3. Which factor has the most influence on E-Marketing adoption decision?

1.5 Scope of Study

The study involves hundred randomly selected SMEs in the Kumasi metropolis, Ashanti

region Ghana. The area was selected due to proximity to the researcher and for

convenience. The SMEs chosen were those that comply with the Ghana Statistical

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Services‟ classification of SMEs. The population comprises of owners and managers of

SMEs. The scope involves SMEs that employs ICT to facilitate buying and selling and

exchange of information in a manner that brings value to the organization.

Consequently, for the purpose of this study, electronic transactions that happen over the

internet including Emails and have a bearing on the operations of the business will be

considered as E-marketing.

1.6 Research Methodology

The study was conducted to understand the SME business environment, to put the SMEs

in a socio-technical context to understand their nature and characteristics with regards to

the adoption and use of ICT technologies. This research takes a quantitative and a

qualitative approach in handling the data gathered. Quantitative approach allows the

various factors of E-Marketing adoption to be quantified and measured in relation to the

strength of their influences. The Qualitative method is to explore and interpret the nature

and characteristics of the various influencing factors and their inter-relations. All SMEs

operating within the Kumasi metropolis constitutes the population for the study from

which a sample size of 100 SMEs was randomly selected to participate in the study.

Simple random sampling technique was used to obtain the 100 respondents who were

both managers and owners of the SMEs. Primary data was collected through the

distribution of questionnaires to the respondents. Secondary data for the study was

collected from various sources such as a literature review of previous studies, journals,

websites.

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1.7 Justification of Study

This study seeks to provide SMEs in developing countries the needed information to

enhance their marketing operations through online marketing platforms and expand their

markets to transact with customers across all borders; thus, the findings will guide SME

owners and management about the underlying factors that prevent incorporating online

marketing practices into their business operations. In addition, this study will contribute

to the limited body of knowledge that exists on SMEs and E-Marketing adoption.

1.8 Organization of Study

This research has been organized into four chapters. Chapter One contains a brief

description of the research through the introduction to the study. It also contains the

problem statement, the research objectives, research questions the scope of the study as

well as the justification of research. Chapter Two is the literature review which situated

the work in the context of other studies already done. The Third Chapter outlines the

research methodology adopted for this study. It examines the research method, sources

of data, sampling procedure and data collection methods. This is followed by Chapter

Four which features the analyses of field data and findings. Chapter Five contains the

summary, conclusion and recommendations including areas for further research.

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 CHAPTER TWO

LITERATURE REVIEW

2.1 Introduction

The previous chapter introduced the research topic, an overview of the subject, and the

research questions that this seeks to throw some light on. This chapter concerns a review

of related literature on E-marketing and its subsequent adoption among small and

medium enterprises in the country. The chapter will begin with past studies in the area

of ICT adoption among SMEs as a whole and of its component namely, E-Marketing.

2.2 An Overview of ICT Adoption among SMEs

Many opportunities lies in the adoption and integration of ICT into the operations of

SMEs. With the dynamic nature of the business environment and the constant changes

in the needs of SMEs, it has become relevant now more than any other time for small

businesses to completely integrate ICT in order to grow and become competitive in the

market. The integration of ICT allows small businesses to compete efficiently and

successfully locally and internationally. The internet and ICT in general has provided

immense benefits to small businesses, as ICT continues to evolve, it has provided

numerous research opportunities (Fatima, Norizon2012). The application of ICT not

only benefits large and developed companies but also small and medium enterprises in

reaching their target and goals (Shemi, 2012)

Although ICT is not new to the business community in Ghana, its use became well

known among firms and organizations only about two decades ago. During the

introductory stages of ICT in the country, most businesses relied on faxes etc.

8
organizations could only use hard copies of documents, which took relatively long

periods to put together and deliver. Because of the worldwide impact of ICT adoption,

some SMEs are beginning to realize its importance and have integrated it in their

business operations. Nevertheless, some SMEs in Ghana and many other African

countries are still hesitant to adopt ICT in their everyday activities.

2.3 A Brief History of E-Marketing

E-Market origins predates the internet. The commencement of internet marketing takes

us back to the 1960s, shortly after that, almost all innovative electronic applications was

introduced just about the late 70s (Turban, King, Lee, &Viehland, 2004). An additional

improvement which was later introduced known as the Electronic Data Interchange

(EDI), made it possible for businesses to conduct transactions such as purchase orders

and invoices to be transferred between two or more organizations using standard

procedures and documents (Papazoglou & Ribbers, 2006).

The internet was started by the US Government in the late 1960s to assist scientific

researches and matters of academia (Senn, 2004). A speedy development of the internet

and its virtualcontents subsequently enabled organizations to distribute and trade data as

it was less expensive than the EDI which was previously the preferred medium (Turban

et al., 2004). By the start of the millennium, the internet experienced a crisis known

popularly as the Dot.com Crash that was characterized by the massive collapse of all

internet-based businesses in the United States (Teo & Ranganathan, 2004). Since that

incident, efforts have been made by the US government, business organizations and ICT

practitioners to find the best way to eradicate or minimize future system failures and

9
losses. The number of Internet users has risen significantly since its introduction and by

this means facilitate the exchange of goods and services between businesses and

individual consumers.

Large business organizations especially in developed countries use E-Marketing and

reap its benefits whilst the smaller and medium enterprises‟ adoption has rather been

slow particularly of those in the developing country regions (MacGregor & Vrazalic,

2004).

2.4 Benefits of E-Marketing to SMEs

Due to potential benefits of E-Marketing to small businesses in the country and the

national economy as a whole, its adoption by the small and medium businesses has been

a source of concern for governments and researchers (OECD, 2004). Some benefits

related with the adoption of E-Marketing by organizations and individuals as outlined by

Senn (2004, p.387) are the Geographical reach of the technology since there is no barrier

for participants as they are able to contact any geographical location on the globe

through communication networks. Another benefit is Speed, where the interaction

between the participants of E-Marketing happens within a short span of time.

Productivity is also another benefit derived from adopting the technology as a result of

the high-speed nature of Internet transactions, participants of E-Marketing can also

devote their time to other pressing activities because of the speed and time efficiency of

the technology. This allows room to be extra productive and achieve desired outputs. It

also contributes to Information sharing which is any digital data in the form of

audiovisuals that is easily shared among participants that are connected to the network.

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Another benefit for E-Marketing users is the capacity to be innovative with the products

and services that they offer online. Another desired benefit associated with the adoption

of E-marketing is Lower costs i.e. the nature of the internet allows for less expensive

methods as compared to traditional ways of marketing. Because the technology

eliminates intermediaries, communication between the producers and customers is

relatively at no cost. Adopting E-Marketing strategies can also help a business to

develop and sustain a competitive advantage over their competitors in the industry.

According to research, only large corporations in developed countries have actually

taken up E-Marketing and realized its benefits (Martinsons, 2008). (Kartiwi &

McGregor, 2007) also notes that large business organizations in developed countries

find it easier to adopt E-Marketing into their operations because of the wide resources

available at their disposal whilst SMEs in the developing regions find it a little harder to

adopt E-Marketing because they lack the expertise, the resources and the political and

business environment in the countries does not encourage E-Marketing adoption.

Even though SMEs may benefit from E-Marketing implementation in several ways, it

must be noted that its realization is not easily achieved. Majority of the stated benefits is

gained through comparatively meek capital in new technologies. On the other hand, it is

vital to note that the benefits stated above are not tied to E-Marketing (Cudjoe Dan,

2014)

2.5 SMEs Readiness for E-Marketing

For small and medium organizations to successfully implement E-Marketing, an SME

must have all the necessary infrastructures needed to conveniently adopt and implement

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a successful E-Marketing. The needed infrastructure is an internet connection or other

communication networks like the Ethernet connected to electronic devices as laptop

computers, personal computers and smart phones. The important element in all of this is

the electricity needed to run these electronic equipments which is constantly available in

developed countries but may not be the case with developing countries like Ghana

which is at present experiencing the worst power crisis in the history of the country.

Several responses from researchers on the obvious obstacles of E-Marketing adoption

indicate that most SMEs fail to reap its benefits because of a lack of awareness of its

potential to transform businesses. (Constantinides, 2010) reports that the major barrier

preventing the adoption of E-Marketing by SMEs is mainly due to a lack of interest and

indifference. Unlike their larger competitors who reap the benefits of E-Marketing

adoption, SMEs who do not yet fully understand the benefits and impact of E-Marketing

do not also feel comfortable with the investments and cultural change involved (OECD,

2000). Besides the obvious lack of interest on the part of some SMEs in the developing

countries, others in the developed countries have been able to adopt E-Marketing

successfully. I hope that those in the developing countries like Ghana would eventually

comprehend the benefits and impact of adopting E-Marketing in their operations as the

internet becomes popular in the 21st century.

According to global networked readiness rankings (GITR, 2012), businesses in

developing countries like Ghana have a low readiness status for the technology, this

might explain why they are not adequately motivated for E-Marketing adoption.

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2.6 E-Marketing Adoption Factors in SMEs

The adoption factors for E-Marketing can be considered as those factors that either

facilitate or prevent the adoption of E-Marketing. The factors would be looked at in a

four dimensional framework. According to Tornatzky and Fleischer, an organization

adopts and uses ICT innovation because of three main factors that are the Technological

factor, the Organizational factor, and the Environmental factor. However, since

individuals or a group of individuals owns most SMEs in developing countries including

Ghana, the Individual factor has been included. The factors for that reason are based on

the organizational, environmental, technological, and individual dimensions (Shemi,

2012)

2.6.1 Individual Factors

The individual factors include the customers, the staff, management and anyone that

conducts business with the organization. These individuals largely influence the

adoption of E-Marketing in a firm. The level of education of these individuals and their

technological awareness are very vital to the adoption process. Nearly all staff with

influence and power to adopt the technology functions at an executive level or form part

of a top-level unit that performs certain specific important responsibilities. The owner of

the business usually manages most SMEs (Demirbas, Hussain, & Matlay, 2011).

The following sub-sections describe owner/manager and other individual aspects

affecting E-Marketing adoption.

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2.6.1.1 Characteristics of the Owner.

The characteristics of the owner or a manager of an SME has a significant bearing on

the adoption and implementation of ICT and E-Marketing. The owner usually makes all

the executive decisions including all the financial decisions that has to do with the firms

overall long term strategy, the acquisition of ICT infrastructure, whether the firm must

adopt E-Marketing or not, depends on the level to which the owner appreciates ICT and

new technological developments. This is usually the trend since the owner is the full

driving force behind the organization.

The problem is when the owner or manager is unenthusiastic to recommend E-

Marketing or any ICT developments for that matter. A more enthusiastic owner

develops new objectives for the SME in a way to transform it technologically (Karakaya

& Shea, 2008). In the situation where the manager of an SME is not enthusiastic about

technological innovations and does not wish to transform the firm, there is stifled

growth. Extensive surveys have also further pointed out that the attitudes and

perspectives of the manger on ICT use and adoption is significant in the development of

the firm‟s internal ICT competencies (Wilson, Daniel, & Davies 2008).

2.6.1.2 Level of Education

The level of education of the manager and other key personnel in the firm is a

significant factor in establishing and maintaining E-Marketing activities in the firm.

According to literature, the level to which an SME owner or manager is educated is

considered to be an important criteria for the successful implementation of E-Marketing

(Sarosa & Zowghi, 2003). SME owners and managers in developing countries

14
experience language barriers and cannot interact in most international languages which

consequently prevents them from accessing the global market. The level of education

usually considered acceptable is a high school certification even though a business

certificate could go a long way (Shemi, 2012).

2.6.1.3 Level of ICT and E-Marketing Knowledge

Another factor at the individual level is the extent to which the operators of small

businesses are knowledgeable about ICT and E-Marketing. Consequently, a successful

adoption and implementation of E-Marketing in a firms operations is partly dependent

the level of ICT and E-Marketing knowledge of key personnel. A healthy appreciation

for E-Marketing by the manager and other key personnel can influence the adoption

process in the business. Due to the availability of resources and ease of entry into the

business sector, SMEs in developed countries have a better knowledge of ICT than those

in developing countries (Eriksson, Hultman&Naldi2008).

In a comparative study of ICT adoption levels in the US and Canada, Karakaya and

Shea (2008) discovered that SMEs in the United States make better managerial

decisions which they attribute to the adoption of ICT and E-marketing. They further

establish that the numerous E-Marketing and ICT initiatives among the US companies

are because of a huge appreciation for ICT technologies by both business and customers.

In developing countries like Ghana, a high level of illiteracy is prevalent amongst the

SMEs. This makes it very problematic for the managers to appreciate the benefits e-

market adoption brings to the firm. In most instances, especially in developing countries

like Ghana, SME owners are generally reluctant to keep themselves informed about ICT

developments. Many owners are of the view that ICT and other technological
15
developments are expensive to implement and have not explored other cost effective

means of gaining access to international markets (Scupola, 2010).

2.6.1.4 Social and Cultural Influences

Several studies on the subject have iterated the need to consider the social and cultural

influences that affect the E-Marketing decision in the context of a developing country

(Avgerou, 2004). They further assert that not enough emphasis is placed on the social

and cultural influences when such technologies are imported from developed countries

into developing ones where it is expected to be implemented. Usually, these

technologies are coded in the language of where it originated with little attention given

to the languages of the developing countries. This is a key position advocated by

Avgerou and colleagues.

2.6.2 Organizational Factors

Organizational factors are unique to the firm itself and constitute the nature and

characteristics of the firm. Several factors are cited as either motivating or hindering the

adoption and implementation of E-Marketing in a firm.

The following sub-sections consider these factors:

2.6.2.1 Security, Trust, and Privacy Concerns

Among the most critical determinants of E-Marketing adoption for businesses and

online consumers are the issues of trust, online security and privacy (Bharat & Abhijit,

2010). According to Choudhury and Choudhury (2010), security is categorized into two:

16
providing security for all transactional data and information of the users and privacy for

the private details of the customers. In developing countries, customers have doubts

about the security of their data and transactions on internet platforms. Such security

concerns have allowed for the partial implementation of E-Marketing a situation where

most internet-marketing providers allow electronic mails but not online expenses

(Karanasios & Burgess, 2008).

Some researchers have narrowed the security concerns down to „Trust‟, which is

considered by the researchers as a significant element to be integrated into E-Marketing

adoption (Dick, & Miller, 2011). The issue of trust is everyone‟s responsibility in this

setting and even more so for the internet stores (Kim & Benbasat, 2009).

An issue of privacy concerning business to consumer (B2C) environments is touched on

by previous researches. Privacy in this context has to do with the ability of the

organizations to protect and control personal information about the customers that

transact business on their online platform. The large number of social media platforms

has also made the privacy and protection of personal information more significant over

the years.

There are no legal remedies provided to address the inevitable situation of a security

breach on online platforms. This has been a major setback for most SMEs in developing

countries since their governments provide no legal framework to regulate the activities

of online marketing. In addition, most SMEs do not have the financial strength to restore

and upgrade their systems should there be an attack on their systems.

17
2.6.2.2 Financial Ability and Cost Implications

Finance is perhaps the most outstanding issue affecting the decision to adopt E-

Marketing among the majority of SMEs in a developing country context like Ghana.

Finance relates to resources firms can employ in acquiring and implementing

technological innovations, consultation fees, the hiring and training of key personnel in

the handling of their ICT set-up including the maintenance and servicing of ICT

infrastructures and websites (Mutula & Van Brakel, 2007).

2.6.2.3 Size of the Organization

The size of an organization has been known to influence the decision to adopt E-

Marketing according to numerous surveys (Bharati & Chaudhury, 2006). Large

organizations have been known to possess all the needed resources unlike SMEs who

cannot afford the high cost of acquiring and setting up such a system. In the US

environment, Bharati and Chaudhury (2006) observed the extent and the nature of ICT

adoption among SMEs in the Boston area. They noted that the size of an organization

has a significant weight on the kinds of technologies engaged. They further observed

that simple technologies such as web and accounting softwares were ubiquitous with

most firms unlike technologies like Customer Relationship Management (CRM) and

SCM, which is complex, and in minimal use (Karakaya & Shea, 2008).

2.6.2.4 Perceived benefits of ICT

Another factor cited in literature is the perceived benefits resulting from E-Marketing

adoption and use. Most small businesses in developing countries are not aware of

18
existing technologies including E-Marketing and how such technologies can be of use to

their organization because of lack of education mostly and also due to the perceived

high financial requirements which makes some owners of SMEs simply not interested in

its adoption. They often complain that trying to ascertain the benefits of a technology

before actually using it makes it hard to adopt it. (Ramsey & McCole, 2009).

2.6.2.5 Organizational Culture

The culture of an organization has been cited as a key factor affecting the adoption of E-

Marketing strategies amongst SMEs. IT adoption processes that require some degree of

change within an organization may also require changes in the culture. Therefore, the

decision to adopt ICT systems such as E-Marketing will require some changes in the

business processes as well as the culture of the organization. The impact of

organizational culture on E-Marketing has not been explored in-depth.

Hofstede (1984) has done important work in this regard describing how organizational

cultures affect ICT adoption in his research. Some dimensions of organizational culture

include Power distance, which is the degree to which workersperceive thepower in the

organization is dispersed disproportionately. Uncertainty avoidance is the level of

ambiguity and uncertainty associated with a person role in an organization. There is

also individuality versus socialism, which describes the extent to which an individual

perceive himself or herself as an individual rather than team worker. Lastly, there is the

relative importance of the here and now versus the future, which Hofstede referred to as

Time orientation.

19
Ghana as a country can be observed to be having low amount of individuality (Boateng,

Molla & Heeks, 2009). Consequently, people prefer to communicate in less formal ways

both in social and in business environments.

2.6.3 Technological Factors

The technological factors discussed here are of the ICT itself. They constitute the nature

and characteristics of the technology that the firm intends to work with or using. The

subsections below takes on these factors:

2.6.3.1 Availability and Slow Speed of Internet

The level of internet availability in any developing country contributes to a great extent

the readiness or delay in E-Marketing adoption. The slow speed of the internet even in

the urban areas has only further deterred the adoption of ICT processes by most SMEs.

Furthermore, the available internet is slow and does not encourage E-Marketing

adoption by SMEs (Mutula & Van Brakel, 2007).

2.6.3.2 Complexity of Technology

One of the factors that described as essential in the adoption of E-Marketing among

SMEs is the complexity of the ICT. Some concerns about how data is managed between

the old and the new ICT applications for instance have caused some organizations to be

unconvinced about E-Marketing adoption ((Forman, 2005). The manager or owner of an

SME with sufficient knowledge in ICT can proceed to implement E-Marketing

20
transactions and reap its benefits on the other hand a manager with no or little

knowledge may hinder any E-Marketing considerations in their organizations.

2.6.3.3 Lack of Payment Facilities

Facilitating services such as online payment structures are not available in most

developing countries contributing to an incomplete E-Marketing system (Mercer, 2005).

2.6.3.4 Lack of Reliable Power Supply

Most developing countries do not have stable power supply and some are struggling to

sustain a stable supply even at their current low levels. This observable fact has

consequently affected E-Marketing adoption because there is no electricity to power

ICT equipment.

2.6.3.5 Language Barrier

According to literature, language barrier has been cited as a factor preventing SMEs in

developing countries from adopting E-Marketing transactions (Mercer, 2005). He

further notes that almost all technologies required to implement ICT systems are

developed with English as the base language for these technologies thus emphasis is

never placed on other languages unless they are developed for those specific regions.

21
2.6.3.6 Lack of Internet Address space

Chibelushi and Costello (2009) asserts that internet space is fast running out mainly as a

result of the ever growing subscribers of mobile phones, the upsurge of internet users

around the globe, the increasing use of radio frequency identification (RFID) tags.

2.6.4 Environmental Factors

An organizations external atmosphere also affects its ability to adopt E-Marketing. The

external factors may relate to readiness of markets for E-Marketing, competition, role of

government, finding the right partners, internet and telecommunications infrastructure,

business industry culture etc.

2.6.4.1 Government Support

The government can play a role in the development and adoption of E-Marketing by

establishing various forms of interventions for SMEs. These interventions can be in the

form of facilitating policies for SME activities in the country, providing financial and

technological support by establishing and empowering institutions, improving internet

structures and enacting favorable laws (Martinsons, 2008). According to literature,

governments of developing countries can support e-market and e-business adoption at

advanced levels by being proactive in providing the enabling environment for

businesses to use ICT systems effectively. Unfortunately, this is not the case in almost

all developing countries as their governments are for the most part concerned with

issues of poverty, hunger etc.

22
2.6.4.2 Business Partner Affiliation

An additional factor that has an influence on E-Marketing adoption in SMEs is the

quality and competences of business partners who may constitute customers and

suppliers. Customers are the primary reasons why an SME may want to adopt any form

e-business. Finding the right customer base that is e-market ready has been a reason why

many organizations do not implement the system because it E-Marketing involves

establishing a long-lasting relationship with the customer and this quite expensive to

establish. This includes relationships with suppliers as well. (Parker & Castleman,

2009).

2.6.4.3 The Nature and Characteristic of Value Chain

In the business-to-business (b2b) environment, opportunities for E-Marketing adoption

may be possible from the social relationships that exist between organizational buyers

and sellers. It can also deter any opportunities for E-Marketing development. Studies

from most developing countries indicates that the peculiar nature of certain industries

such as the horticultural and garment industries prevent SMEs from adopting ICT

systems (Moodley & Morris, 2004). For such industries its closed nature makes it

irrelevant to conduct transactions openly on the internet.

2.6.4.4 Economic and Political Instability and Human Rights Issues

Political instability and a bad economy do not provide the environment needed for the

development of internet-based transactions such as E-Marketing. It prevents SMEs from

trading between them even on a regional level.

23
2.6.4.5 Natural Disasters, Earth-quakes&Floods

E-Marketing adoption can be greatly hindered and drastically slow its growth. For

example, recent occurrences of devastating natural disasters in countries such as Japan,

Haiti and Brazil, are brutal reminders by nature of the serious forces in the form of

natural disasters that may confront SMEs and in most of these cases wipe out entire ICT

infrastructures and lives (Shemi, 2012).

2.6.4.6 Business Culture

One of the factors cited in literature as significant for the adoption and development of

E-Marketing among SMEs is the established culture of the organization. Organizational

cultures vary from country to country and between different industries (Scupola, 2009).

2.6.4.7 Macro-Economic Policies

In developing countries, macroeconomic policies are a mechanism for E-Marketing

expansion and development (Martinsons, 2008). Molla, Taylor, & Licker (2006) asserts

that during the initial stages of e-market development and implementation, public as

well as other external institutions play significant roles to create favorable environments

for the adoption and spread of E-Marketing..

2.6.5 The Interaction of Factors and the Extent of E-Marketing Adoption

While many researchers have looked into the different drivers and barriers to E-

Marketing adoption and development, very few of these studies have advanced that

search into the fundamental nature of the factors affecting the adoption of E-Marketing

24
and how they relate to its adoption by SMEs (Dholakia & Kshetri, 2004). Studies

suggest that e-market adoption and its success depends on a clearly set and practical

business strategy (Martinsons, 2008). Such business strategies are developed out of a

thorough assessment of internal and external factors pertaining to the firms‟ activities.

2.7 E-Marketing Development in Organizations

This level takes most SMEs through several evolutionary stages. Most organizations

begin by building one-way websites that features listing products and prices and then

evolve into a two-way communication websites capable of interacting with customers

by making sales transactions and having two-way communications whether sales, email,

discussions and automated interactions.

2.7.1 Growth Stages

The growth stages concept is one outline that helps to understand the factors affecting E-

Marketing adoption among SMEs. Researchers have pointed out in previous studies that

organizations undergo certain growth stages in their adoption of ICT and E-Marketing

technology (Taylor & Murphy, 2004). These growth stages have assisted researchers in

determining the various factors that have prevented or facilitated the development and

adoption of E-Marketing technology among SMEs.

During the 1990s, the British governments‟ Department of Trade and Industry (DTI) E-

Marketing adoption ladder was a widely adopted concept (Martin and Matlay, 2001). It

demonstrates the various stages SMEs move through in adopting any ICT technology.

25
The stages are:

1. E-mail

2. A website

3. E-commerce

4. E-business (E-Marketing) and

5. The transformed organization.

The DTI growth stages states that E-Marketing adoption process among SMEs

progresses from one stage to a higher level in a chronological and well-planned

approach (Martin & Matlay, 2001). However, this growth model has been criticized as

being too basic and its linear evolutionary structure fails to address the complex

activities of SMEs. It does not identify the non-linear and often complex processes of

SMEs. Zappala and Gray (2006) are also of the view that the DTI model lacks strong

evidence to suggest that the stages in the model actually do represent evolutionary steps

by which SMEs transform themselves into e-businesses.

26
Figure 2.1: DTI Adoption ladder UK online (Source: Martin and Matlay, 2001)

Daniel, Wilson and Myers (2002), in their study on UK SMEs discovered that

organizations move through four clusters in the process of adopting E-Marketing. These

clusters form a sequence of stages where an SME moves from one adoption cluster to

another. The first cluster constitutes innovation where small firms begin to develop e-

marketing services. The second adoption cluster involves small firms using E-mails to

communicate with their customers and suppliers. The third cluster is SMEs using

information based website services and the fourth cluster is developing online ordering

services (Daniel et al., 2002). Their work has been highly criticized for being too

simplistic and as such has failed to recognize the complex nature of assimilating E-

27
marketing into SMEs (Parker & Castleman, 2009). Furthermore, their work has been

cited for not identifying the overlaps in the adoption stages and its inability to explain

the underlining causes of rejection or the discontinuity of e-marketing adoption (Parker

& Castleman, 2009). The findings and conclusion the work of Daniel et al, (2002) is

understandable because at the time ICT adoption among organizations were at low

levels and many SMEs were now recognizing the benefits of implementing e-business in

general thus it is possible that SMEs exhibited such behavior when it came to ICT

adoption.

Lee, Pak and Lee (2004) in their study differentiate between two types of business-to-

business (B2B) e-marketing adoption. The basic and collaborative B2B E-Marketing.

The basic B2B E-Marketing occurs where an organization has set up an electronic

network to facilitate the transfer of commercial and other business documents. The

collaborative B2B on the other hand describes the B2B networks that have been set up

to create new inter-firm operations with partners. The researchers further states that the

basic B2B E-Marketing does not yield the much-needed benefits as compared to the

collaborative B2B electronic networks. SMEs in developing countries are the main

beneficiaries of collaborative B2B networks more so in situations where SMEs usually

form collaborative groups to transact business (Donner & Escobari, 2010). Other

researchers have placed e-marketing development in organizations into two broad

categories; the initial adoption and later institutionalization stages (Mollar and Licker,

2005).

28
Mollar and Licker (2005), in their study on e-business adoption among SMEs in

developing countries asserts that organizations go through a six-staged adoption process

in an attempt to develop E-Marketing. The six stages are:

Stage 0: Not connected to the Internet, no e-mail

Stage 1: Connected to the Internet with e-mail but no Web site,

Stage 2: Static Web, that is publishing basic company, information on the Web,

Stage 3: Interactive Web presence that is, accepting queries, e-mail, and form entry from

users,

Stage 4: Transactional Web that is, online selling and purchasing of products and

services such as customer service,

Stage 5: Integrated Web, that is, a Web site integrated with suppliers, customers, and

other back- Office systems allowing most business transactions to be conducted

electronically.

Molla and Lickers‟ six-stage process has also been criticized as Daniel et al condemned

for being too one-dimensional and failing to identify the complex nature of integrating

an ICT technology into organizations (Parker & Castleman, 2009).

Another adoption model proposed by Rao, Metts and Monge (2003), attempts to show

the details of each adoption stage and identify the various facilitators and barriers at

each step of adoption. The researchers developed a four-stage process organizations

progress through in adopting E-Marketing. The stages are: Presence, Portals,

Transaction Integration, and Enterprise Integration.

29
The researchers add that there are unique facilitators and challenges peculiar to each

adoption stage (Rao et al., 2003). They further state that while the adoption stages are

chronological, an organization does not have to finish one stage before moving on to

another. The model has provided a useful classification of organizations and introduced

certain barriers and facilitators of E-Marketing adoption. The key criticism levied

against this model is that it fails to consider the peculiar nature of SMEs environment in

developing countries that contribute to failure to adopt E-Marketing. The researchers

persuade others to pursue further studies regarding the model to advance it.

30
 CHAPTER THREE

METHODOLOGY

3.1 Introduction

This chapter includes the study area, study population, research design, and sample size,

sample frame, sampling techniques, methods of data collection, data handling, and

ethical considerations

3.2 Research Paradigm

Research paradigm refers to the theories or a set of belief systems that guide how we

conduct certain activities. It may constitute a range of thought patterns and actions that

guides the conduct of a research. Research is governed by particular paradigms such as

the phenomenology (qualitative) and positivism (quantitative). Each of these paradigms

have their unique approach to the ontological, epistemological and methodological

questions in research.

Phenomenology paradigm was first introduced by the philosopher Edmund Husserl and

was later developed by Heidegger. In simple terms it refers to the situation where the

researcher directly experiences and investigates a phenomenon directly, its primary

objective is the direct investigation and description of phenomena as consciously

experienced, without theories about their causal explanations or their objective reality

(Manen M, 1990). Augustus Comte is credited with the development of the Positivism

paradigm. Sometimes known as scientism, is the most widely used among research

paradigms. The philosophy of positivism is that, knowledge is credible and trustworthy

only if it is attained through pure observation and statistical measurements. In positivism

31
studies, the role of the researcher is limited to data collection and interpretation through

objective approach and the research findings are usually observable and quantifiable

(Collins, 2011). According to the principles of positivism, it depends on quantifiable

observations that lead themselves to statistical analysis, the researcher is independent

from the study and there are no provisions for human interests within the study.

Using qualitative and quantitative approaches, the study examined the factors affecting

the adoption of E-Marketing among SMEs; case study of selected SMEs in the Kumasi

metropolis, Ashanti region. Quantitative approach was used to determine the magnitude

of each factor in influencing adoption of E-Marketing among SMEs. A qualitative

approach was useful to provide the researcher with perspective

3.3 Purpose of the study

Most research can be placed under three broad groups namely Exploratory, Descriptive

and Explanatory. The use of each depends on the end purpose of the researcher and what

the research seeks to achieve. The purpose of the research is determined by the

objectives in connection with the research problem at hand. Robson (2002) stated that,

one means of gaining valuable insight and to find out „what is happening‟, is to ask

critical questions and assess a phenomena in new light by an exploratory approach. The

prominent advantage of this approach is that, it is flexible and adaptable to change. The

flexibility offered by the exploratory approach means that research could start expansive

and become progressively narrower and more specific as it progresses.

The Descriptive approach is considered by many to be conclusive because of its

quantitative nature. With this approach, the research is usually preplanned and

32
structured in a way to collect information that can be statistically inferred on. It seeks to

provide an accurate description of a phenomenon by better defining an opinion, attitude,

or behavior. Saunders, Lewis and Thornhill (2007) further state that descriptive research

can be considered an extension of exploratory research. With this approach, the

researcher needs to accurately define the phenomenon under investigation. It also helps

the researcher to draw specific conclusions based from the data collected.

Saunders et al (2007) describes explanatory studies as studies that establish a causal

relationship between variables. The goal here is to explain the relationship between the

variables of the phenomenon under investigation. Research begins as exploratory to find

out what is happening and transforms to a descriptive and explanatory depending on the

objectives of the study Anderson and Svensson (1999).

Research and information on SMEs adoption of the E-Marketing tends to be limited,

thus the researcher is adopting exploratory and descriptive study to gather the relevant

information in connection with the set research questions and objectives.

This thesis employs both exploratory and descriptive methods since it seeks to

understand what is happening and ask questions about E-marketing and the level of

adoption by small and medium enterprises in Ghana. In addition, there has not been

enough studies conducted on the subject and so information regarding E-marketing and

internet adoption by SMEs is hard to come by as a consequence this studies employs the

exploratory and descriptive methods to inquire about what is happening for people to be

abreast with the subject.

33
3.4Sampling procedures

This section introduces the various sampling techniques employed to accomplish the

research. This denotes all the stages and the processes involved in reaching the

respondents. According to Twumasi (1986), the first step in the selection of a sample is

to consider sampling technique. In sampling design, characteristics of the population to

be studied must be clearly indicated.

3.4.1 The population and sample

All SMEs located in the Kumasi metropolis constitute the target population for the

research. The study populations are all the owners and managers of SMEs including all

relevant personnel involved in the decision to adopt any ICT technology in the

organization. The sample frame consists of SMEs that employ internet in their

organizations but not specifically conducting business over the internet. This is based on

the assumption that most SMEs in the study area do not have internet installed and the

few ones that have do not use it for marketable purposes. The sample size for the study

consisted of 100 respondents. This comprised of SMEs in the areas of finance,

hardware, retail, manufacturing, clothing, stationery etc. The researcher chose this

sample size of 100 to efficiently manage the responses due to time and resource

constraints and to ensure a critical analysis of the phenomenon under study.

3.4.2 The sampling technique

Researchers use sampling techniques to select the participants for their sample, these

techniques help to minimize cost whilst maximizing generalisability (Babbie, 1990).

34
Random and Convenience sampling were utilized in this study. Simple random

sampling precludes that all members of the study population are either physically

present or listed, and the members are selected at random until a previously specified

number of members or units has been selected (Henry, 1990). First, random sampling

was used to select the SMEs within the Kumasi Metropolis to ensure that all SMEs that

have the characteristics being investigated have equal chances of being selected.

Convenience sampling includes participants who are readily available and agree to

participate in a study (Berinstein, 2003). MacNealy (1999) indicates that convenience

sampling is often called accidental. Convenience sampling was used to select

respondents consisting of owners and managers or the decision makers of the SMEs.

This was to ensure that only respondents with the characteristics that the researcher

requires are selected for the study.

3.5 Data collection methods

Primary data are information collected by a researcher specifically for a research

assignment. In other words, primary data are information that a company must gather

because no one has compiled and published the information in a forum accessible to the

public (Berinstein, 2003). Bernstein, 2003, further states that Primary data are original in

nature and directly related to the issue or problem and current data. Primary data are the

data that the researcher collects through various methods like interviews, surveys,

questionnaires etc.

According to Henry (1990),Secondary data are the data collected by a party not related

to the research study but collected these data for some other purpose and at different

35
time in the past. If the researcher uses these data then these become secondary data for

the current user. These may be available in written, typed or in electronic forms. A

variety of secondary information sources is available to the researcher gathering data on

an industry. The data needed for this study was collected from several primary and

secondary sources namely: document analysis, Literature reviews, website analysis and

business environment observations. A self-administered questionnaire was distributed

among the respondents. The information from the respondents constitutes the primary

data for the study. Their responses were analyzed and became the basis for subsequent

discussions. Quantitative data for the study was in the form of numeric responses or

figures for issues such as “Number of employees in organization”, how many computers

utilized by the organization, etc. a great part of the responses was qualitative in nature

that comprised words and groups of words. Semi-structured interviews were used in the

situation where respondents needed assistance with the questionnaires or were not

specialists in the ICT field.

Secondary data was included in the study to broaden the scope of review and have a

wider understanding of the phenomenon. Existing journals, articles, internet,

newspapers, published and non-published works of scholars in the area of study formed

the main sources of secondary data. Secondary data forms the contents of the literature

review which was undertaken to understand the phenomenon from past literature.

3.6 Data Analysis

Analysis of data is a process of editing, cleaning, transforming, and modeling data with

the goal of highlighting useful information, suggestion, conclusions, and supporting

36
decision making. (Adèr, 2008).From the self-administered questionnaires distributed to

the respondents, both qualitative and quantitative data was gathered. Quantitative data

from respondents was edited, coded and processed with Statistical Package for Social

Sciences (SPSS). The data was analyzed using descriptive statistics as that allowed the

researcher to make relevant interpretations and discussions about the topic under study.

3.7 Quality of the research

Quality control of research is an integral part of all research and takes place at various

stages, during data collection, data entry or digitization, and data checking. It is vital to

develop suitable procedures before data gathering starts (MacNealy, 1999). According

to Henry (1990), during data collection researchers must ensure that the data recorded

reflect the facts, responses, observations and events. The quality of data collection

methods used strongly influences data quality, and documenting in detail how data are

collected provides evidence of such quality. The study on the Factors Affecting The

Adoption Of E-Marketing among SMEs was conducted after the successful completion

of series of tasks. After reviewing all relevant literature a questionnaire was prepared

guided by the research questions to determine the factors affecting the adoption of E-

Marketing among SMEs. The questionnaire was structured to capture the relevant

demographic details of each participating SME, and the perceived benefits of adopting

E-Marketing and all potential barriers to its development. The questionnaires were

distributed to 100 SMEs in the Kumasi metropolis. The respondents were the owners

and managers of small and medium scale enterprises and other relevant personnel

involved in the decision to adopt ICT technology in the organization. Semi-structured

37
interviews were conducted with the mangers that are not IT specialists or needed

assistance in understanding certain terminologies to make decisions. Quantitative

method was used to establish the degree of each factor in influencing adoption of E-

Marketing among SMEs.

3.8 Research ethics and limitations

Ethics should be applied on all stages of research, such as planning, conducting and

evaluating a research project. The first thing to do before designing a study is to

consider the potential cost and benefits of the research (Babbie, 1990). The primary

ethical concern for the researcher was conducting the study without causing any

infringements. Because of this, the study was carried out with the informed consent of

the various respondents. The respondents were informed of the fact that the study was

for academic purposes only and they possessed the right to decline the researchers‟

permission to interview them. Furthermore, the respondents participated freely whilst

assuring them of secrecy and confidentiality on the information provided. In order to

avoid plagiarism, all sources of information were appropriately recognized. Another

limitation of the study was the researchers‟ inability to record all interviews thus all

quoted interview narratives are paraphrased and may not reflect accurately what the

interviewee said.

38
 CHAPTER FOUR

RESULTS, ANALYSIS AND DISCUSSIONS

4.1 Introduction

This chapter of the study comprises the results and discussions of the fieldwork

conducted in the study in line with the objectives of the study. As such, the researcher

made all the analysis from responses acquired from the questionnaire administered to

owners of SMEs in Kumasi. The study made use of Statistical Package for Social

Scientist (SPSS) version 17.0 to perform all the analysis and the Microsoft Excel 2010

to generate the charts used in the analysis of the data.

In all, one hundred (100) questionnaires were given out with ninety-six (96) retrieved as

valid to be used in the study. This gave a retrieval rate of 96%. The valid questionnaires

were used for the analysis.

4.2 How SMEs Defined Internet Marketing

According to the Manager of 4Heem Apparel: Internet marketing is selling and

promoting goods and services over the Internet.

To the managing partner of Valor Prints: Internet marketing is using the Internet to

define to people about goods and services as well as encourage them to patronize the

products you are offering on the Internet.

To the C.E.O of Atlas Aluminiums: Internet marketing is all about doing business using

Internet.

The Assistant manager of Degeo Boutique defined it as “taking the extra mile to

advertise or make your products and services available on the web or online.”

39
4.3 What factors affect the decision to adopt E-Marketing

According to the C.E.O of Atlas Aluminums: “for me the biggest factors would be cost

and accessibility. It is quite challenging for our budget to set up a fully functional E-

Marketing system”.

The managing partner of Valor Prints: “First of all, I will say high cost of Internet

connectivity. The monthly bundle is quite expensive. Also, stable Internet connection is

not always available therefore making it difficult to access the net sometimes. Lastly, it

is difficult to know exactly who the enterprise is dealing with or sometimes the

responses are few so it wastes resources. All our online marketing efforts happen on

social media. We use Facebook and Whatsapp to reach our customers.

4.4 Extent of Internet Marketing Utilization

The CEO 4Heem Apparel said, the enterprise makes use of just two of the internet

marketing components. “The company uses email marketing to sends pictures to their

customers on the net on weekly basis. I take orders from our customers through emails

sometimes whatsapp and facebook and update or send them new designs of our works.

With the search engine as well I browse to read and gather information about my field

of work.”

4.5 Company Profile of SMEs

The study sought to ascertain the nature of enterprises in Kumasi. The study revealed

that 49% of enterprises in Kumasi are trading enterprises. This is followed by service

enterprises with a total of 39.6% of the respondents. Those that are engaged in

40
manufacturing made up 9.4% of the respondents. This finding shows that most

enterprises apart from those engaged in the provision of services engage in buying and

selling of goods. This explains why there are so many foreign goods on the market in

Ghana. The result is illustrated in figure 4.1 below.

100
96
100
90
80
70 Manufacturing
60 49 51
Trading
50 38 39.6
Services
40
Total
30
20 9 9.4
10
0
Frequency Percentage

Figure 4.1Nature of SMEs in Kumasi (Source: Field Data, 2015)

The study further sought to find out the age group of owners of SMEs in Kumasi. The

study revealed that majority of SME owners fall between the ages of 36 – 45. This was

represented by 41 respondents which constitutes 42.7%. This was followed by those

between the ages of 25 – 35 which made up 25 respondents constituting 26%. Those

between 46 – 55 were next with 19 respondents representing 19.8%. The findings

indicate that most of the owners of SMEs are youth. This is very important for nation

building as most of youth are engaged in businesses. Those above 55 years made up just

8.3% of the respondents. The result is illustrated in the figure below.

41
 100
90
80
Less that 25 yrs
70
25 - 35 yrs
60
36 - 45 yrs
50
46 - 55 yrs
40
Above 55 yrs
30
Total
20
10
0
Frequency Percentage

Figure 4.2Age Distribution of Owners of SMEs (Source: Field Data, 2015)

On the level of education of owners of SMEs, the study found out that the level of

education among owners of SMEs is relatively low with 45 respondents representing

46.9% of the sample. Those with tertiary education represented 28.1% of the

respondents with 19.8% having learnt a vocation. The finding from the educational level

of owners of SMEs is illustrated in figure 4.3.

42
 100
90
80
70 Primary
60 High School
50 Tertiary

40 Vocational

30 Total

20
10
0
Frequency Percentage

Figure 4.3 Educational Level of Owners of SMEs (Source: Field Data, 2015)

The next item on the profile of SMEs was to ascertain the number of employees of such

enterprises. Most of the literature on the composition of SMEs describes the number of

employees as one of the major components of SMEs. The European definition of SME

postulates that a micro, small and medium-sized enterprise (SME) is an enterprise that

employs fewer than 250 persons and which has an annual turnover of not more than 50

million Euro (Hayford, 2012). The National Board of Small Scale Industries (NBSSI)

which is the regulatory authority for SMEs in Ghana defines SMEs as enterprises with

not more than nine (9) workers. The study revealed that 94.8% of the SMEs have

between 1-9 employees. The rest which constitutes 5.2% of the respondents said they

have between 10-19 employees. The number of employees of SMEs is illustrated in

figure 4.4 below.

43
 Number of Employees

5.2%

1 - 9 employees
10 - 19 employees
20 - 29 employees
30 - 39 employees
40 - 49 employees
94.8%
50 or more

Figure 4.4 Number of Employees of SMEs (Source: Field Data, 2015)

The study also sought the scope of the business activities that SMEs. The study revealed

that most of SMEs are operated locally in the city or town they are located. This was

represented by 76% of the respondents. Those that said their scope is national also made

up 100.9% of the respondents with those who have an international scope making up

3.1% of the sample.

The last item on the profile of SMEs was whether they are registered or not. The study

revealed that most of SMEs in Kumasi are registered. The study reported a total of 77

respondents representing 80.2% indicating that their businesses are registered with

19.8% representing 19 respondents indicating their businesses as not registered. The

results from the scope of SME‟s business and whether they are registered are illustrated

in figure 4.5 and 4.6 below.

44
 100
90
80
70
Local
60
National
50
International
40
Total
30
20
10
0
Frequency Percentage

Figure 4.5Scope of SMEs Business Activities (Source: Field Data, 2015)

100
90
80
70
60 Yes
No
50
Total
40
30
20
10
0
Frequency Percentage

Figure 4.6Registered Businesses (Source: Field Data, 2015)

45
4.6 The Extent of E-Marketing Adoption among SMEs

This objective of the study sought to ascertain whether SMEs have adopted E-marketing

and is using them well to benefit them in their activities.

4.6.1 Knowledge and Existence of E-Marketing in the Business Activities of SMEs

To answer these objective, respondents were asked to indicate whether they had heard of

the concept of e-marketing and to also indicate whether their enterprises have

formalized e-marketing into policy at the company. The results from the study are

shown on table 4.1 below.

Table 4.1 Knowledge of e-marketing in the Business Process of SMEs

Knowledge and Existence Frequency Percentage

Yes 84 87
No 12 13
Total 96 100
(Source: Field Data, 2015)

The study revealed from table 4.1 above that most of the respondents have heard of the

concept of e-marketing and has involved it in their businesses where necessary. Eighty-

seven (87%) of the owners of SMEs have heard and attest to the fact that they have

including it in their businesses.

The respondents were further asked to indicate the initiator of the e-marketing on the

business activities of these SMEs. Below in table 4.2 are the results from the study.

46
Table 4.2 Initiator of E-Marketing among SMEs

Initiators Frequency Percentage

Management 49 51.4
Owners 44 45.9
Employees 3 2.7
Total 96 100
(Source: Field Work, 2015)

The results shown in table 4.2 above revealed that management and owners of SMEs

have been very important players in the adoption e-marketing. This provides the clearest

indication of how important e-marketing can be as a marketing tool for most of these

SMEs.

4.6.2 Extent of E-marketing Adoption

The question set to measure the extent of e-marketing adoption by SMEs was

constructed in a Likert scale of 1 – 5 where 1 = Strongly Agree and 5 = Strongly

Disagree. Below in table 4.3 is the result.

Table 4.3 The Extent of E-marketing Adoption by SMEs

The Extent of E-Marketing Adoption Mean Std. Rank

Deviation
Most employees are computer literate 2.1429 .66299 1
Firm recognizes the pros and cons of e- 2.4286 1.28388 2
marketing 2.7143 1.13873 3
The firm‟s owner thinks e-marketing is 3.9231 1.03775 4
important 4.2308 .72501 5
The firm's business is compatible with e-
marketing
E-marketing is a priority for the firm
(Source: Field Data, 2015)

47
The finding revealed that most SMEs to agree that e-marketing is an important aspect of

a business and when adopted properly can have a positive effect on their business

activities. Even though the study revealed that e-marketing is not a priority of most of

SMEs (4.2308), they agree that it is an important marketing tool. A mean of 3.9231 also

indicated that most of SME businesses are not compatible with e-marketing. The results

show that most of the employees of SMEs are computer literates and therefore offer an

opportunity for the use of e-marketing in the business activities of SMEs. The study

further revealed that majority of SMEs recognizes the advantages and disadvantages of

e-marketing utilization on their business activities. This was represented by a mean of

2.4286 with a standard deviation of 1.28388.

The last aspect of this objective was to ascertain whether SMEs regularly use e-

marketing tools in their business activities. The study found out that even though most

of SMEs are aware of e-marketing, its adoption in most businesses however fall short.

The study revealed that 55.6% of the respondents do not use any e-marketing tools as

opposed to 44.4% of the respondents who have adopted e-marketing activities in their

business.

4.7 Factors that affect the Adoption of E-marketing among SMEs

There are many important factors that affect the adoption of e-marketing among SMEs.

These factors to a large extent affect how a specific enterprise view e-marketing and the

perception they attach to its usage in the business. To answer this question, respondents

were asked to indicate the factors that affect their usage of e-marketing. Below in table

4.4 is the result from the question.

48
Table 4.4 Factors that the Adoption of E-marketing among SMEs

RANK FACTORS AFFECTING THE ADOPTION Mean Std.

OF E-MARKETING AMONG SMEs Deviation
1 Owner/manager skills 1.4321 .69333
2 Owner‟s lack of awareness of the technology 1.61003 .64278
3 Type of industry 1.6623 1.65100
4 Type of product/service 1.7231 1.90012
5 Competition in the industry 1.8221 .79831
6 Organizational culture 2.1010 .82159
7 Financial, technical and resource requirement 2.1261 .91589
8 Lack of qualified staff to develop and support E- 2.2310 .67423
marketing
9 Low use of internet by customers and suppliers 2.3428 .99100
10 Security 2.4321 .75412
11 Low company literacy among SME owners 2.7231 .84404
12 Size of organization 2.7773 .45423
13 Perceived advantage 3.2125 .871100
14 Electricity supply 3.2140 .92307
15 High cost of website development 3.2140 .965100
16 Internet fraud 3.2158 1.52961
17 Distrust on the use of online payment systems 3.4210 .78552
18 Perceived ease of use 3.4512 .96961
19 Perceived usefulness 3.8500 1.25712
20 National ICT infrastructure 4.0012 .691008
21 Government support 4.2135 .78071
22 Lack of developed legal and regulatory systems 4.36100 .995100
(Source: Field Data, 2015)

49
The study revealed among the factors that affect the adoption of e-marketing that those

factors that affect the adoption of e-marketing most are owners/managers skills, owner‟s

lack of awareness of the technology, competition in the industry, type of industry, and

the type of product/service. All of these factors had a mean of less than 2 which

indicates that they strongly affect e-marketing adoption of SMEs. The other that affect

e-marketing adoption among SMEs as revealed by the study were low use of internet by

customers and suppliers, low company literacy among SME owners, financial, technical

and resource requirement, security, size of organization and lack of qualified staff to

develop and support e-marketing. These factors also had a mean of between 2.0 and 3.0.

This shows that a lot of factors should be considered if an SME decides to adopt e-

marketing in its business process. Aside these factors, there are other important issues to

be considered in the adoption of e-marketing in a specific organization or firm. As

peculiar as each SME might look, there is also the need to look at how some issues

might be important to a specific enterprise.

100%
90%
80%
70%
60% Strongly Agree
50%
40% Agree
30%
20% Neutral
10%
0% Disagree
Strongly Disagree

Figure 4.7E–Marketing adoption factors (Source: Field Data, 2015)

50
The study revealed that cost is the most important factor that affects e-marketing

adoption in SMES. According to the findings, 42.3% of the respondents were of the

view that cost is very important in their decision to adopt e-marketing whiles 27.8% said

it is important. The next most important factor as identified by the study is accessibility

and then followed by the readiness of consumers to also use e-marketing tools.

According the study, the least important factor that affects the adoption of e-marketing

among SMEs is organizational culture. This finding of the study shows that owners of

SMEs are very concern about cost, accessibility and the readiness of consumers to

embrace e-marketing. This finding of the study is consistent with that of Mercer (2005)

who identified these factors as important considerations of every business entity in their

quest to adopt e-marketing. According to Mercer (2005), the cost of adopting SMEs

should not put pressure on the expenses of SMEs since their average turnover is

relatively low. Any effort towards e-marketing should also be very accessible to be able

to reach its target population.

4.8 Barriers to E-Marketing Adoption among SMEs

To answer this part of the study, respondents were asked to indicate the things they think

acts as barriers to the adoption of e-marketing by SMEs. Variables listed in the

questionnaire as barriers were acquired through the literature reviewed by the study.

Respondents were as such through a five Likert-scale where 1 = Strongly Agree; 2 =

Agree; 3 = Neutral; 4 = Disagree; 5 = Strongly Disagree asked to indicate the extent to

which they agree that the following variables are barriers. Below is table 4.5 showing

the barriers to effective adoption of e-marketing.

51
Table 4.5Barriers to E-marketing Adoption
Mean Std.
BARRIERS TO E-MARKETING ADOPTION Deviation
1.3056 .52478
Unconvincing benefits to the organization

1.7647 .53506
Limited resources in terms of finance, computers
software and hardware
1.8125 .73506
Low level of technology usage within the organization
1.6970 .691008
Lack of qualified staff to develop and implement and
support web sites
Low level of literary among SME owners 1.3714 .91804

1.7500 .91581
High cost of Internet Connectivity and website
1.9342 .78079
Inadequate transportation and delivery network
1.8529 .92307
Lack of online payment process
2.8667 .93109
Limited availability of Online Banking Services.
1.8824 .82139
Lack of developed legal and regulatory systems.
3.8947 .84440
Lack of government support
(Source: Field Data, 2014)

The results from table 4.5 indicate that most SMEs are not convinced about the benefits

of e-marketing. This serves as the barrier that affects the adoption of e-marketing the

most. On the perception of the barriers inherent in the implementation of various e-

marketing strategies, respondents were asked to rank the barriers to the adoption of e-

marketing. If owners of SMEs have doubts about the benefits of e-marketing as to other

forms of marketing, then it is definitely going to limit their adoption of e-marketing in

52
their activities. Most of the owners also think it is not cost effective to adopt e-marketing

and this also serve as a barrier. The other barriers that the study identified include low

level of technology usage in most SMEs, low level of literacy among SME owners, lack

of qualified staff to develop and implement and support websites, high cost of internet

connectivity and websites. These findings of the study is consistent with the study of

Purcell and Toland (2004) which revealed that the determinants of internet adoption in

developing nations are mostly affected by factors relating to the cost of implementation

as well as infrastructure, complexity of the use of internet as well as the perceived

relevance of the technology. According to Cloete et al., (2005) and Nannozi & Coertzee

(2006), South African SMEs see high cost of installation and maintenance as the barrier

to its adoption. Another study by Ramsey and McCole (2005) also posits that most

SMEs do not adopt internet marketing strategies because employees lack the needed

managerial and business skills to operate e-marketing. Inadequate training, capital and

understanding the potential benefits of e-marketing have also been cited by (Migiro &

Adigun, 2005) as the main barriers to the adoption of e-marketing. Other studies

consider lack of knowledge on the part of owners of SMEs as a major barrier as this

brings about lack of awareness; lack of advice and support or having a staff compliment

without the necessary IT skills (Kohn & Husig, 2006).

53
 CHAPTER FIVE

SUMMARY, CONCLUSIONS AND RECOMMENDATIONS

5.1 Introduction

This chapter of the study consists of the summary of the findings, conclusions on the

study conducted on the factors affecting the adoption of e-marketing among SMEs. The

chapter then concludes with the recommendations of the study and areas of further

studies or research.

5.2 Summary

E-marketing over the years has gained lots of popularity in the Ghanaian business

environment as more companies and industries continue to incorporate it in their

marketing activities. SMEs across the globe and specifically in Africa has embraced and

has begun the implementation of e-marketing activities as it is seen as a major

improvement in marketing for a firm. While e-marketing continually enjoys rapid

growth and advances in practice, theory and research has been left lagging behind. This

study was therefore necessary as it looked at the factors that affect the adoption of e-

marketing among SMEs using selected SMEs in the Kumasi Metropolis of Ghana as a

case study.

The population of the study consisted of owners of SMEs in Kumasi. These owners

were used because they were solely responsible for the implementation of e-marketing

at their various workplaces. In all, one hundred respondents were purposefully sampled.

The study had a response rate of 96%. All analyses were therefore made from the

respondents who responded to the questionnaires. The study also made use of a

54
structured questionnaire as a data collection instruments with most of the questions

crafted in a Likert scale of intervals 1 – 5.

5.3 Key findings

The major findings from this study are summarized as follows.

5.3.1 The Extent of e-marketing adoption

The study found out that majority of the owners of SMEs know of the existence of e-

marketing. This was confirmed by 87% of the owners SMEs who took part in the study.

The study further revealed that the initiators of e-marketing activities in most SMEs are

mostly management and owners of the SMEs. Since management of SMEs are mostly

the owners, it can therefore be said that owners of SMEs are most of the time the

initiators of e-marketing among SMEs.

The study also found out that most of the employees of SMEs are computer literates and

can handle the basic tools needed for e-marketing. To further ascertain the extent of

SMEs adoption of e-marketing, the study revealed that most SMEs already know the

advantages and disadvantages of e-marketing activities. Owners of SMEs are also aware

of the importance of e-marketing on the business activities of SME.

The study finally on the extent of e-marketing adoption revealed that e-marketing is

seen by most of SMEs as unimportant in their operations.

5.3.2 Factors that affect the adoption of e-marketing among SMEs

The study found out that the factors that affect the adoption of e-marketing most among

SMEs are: owners/managers skills; owner‟s lack of awareness of the technology;

55
competition in the industry; the type of industry and the type of product/service they

produce.

The study further found out that in specific firms or organizations, the most important

issues affecting e-marketing adoption are cost, accessibility and the readiness of

consumers to embrace e-marketing.

5.3.3 Barriers to e-marketing adoption among SMEs

The study revealed that the main barrier to the adoption of e-marketing among SMEs is

that most of the owners are not convinced about the benefits of e-marketing adoption on

their operations. The other barriers as revealed by the study includes low level of

technology usage within the organization, low level of literacy among SME owners,

Lack of qualified staff to develop, implement and support websites, limited resources in

terms of finance, computer software and hardware and high cost of internet connectivity

and websites.

5.4 Conclusion

The findings of this study do provide a basic support for the inadequate activity of

SMEs with concern to e-marketing. The study can therefore conclude that the main

factors inhibiting the adoption of electronic marketing among SMEs in Kumasi are:

technological incompatibility with target markets; lack of knowledge; stakeholder‟s

unreadiness; technology disorientation as well as perception. These findings of the study

indeed concur with various studies that argue that the non-adoption of e-marketing is

multi-dimensional in its causality and it‟s largely dependent on the business sector under

56
investigation (Stansfield & Grant, 2003). The study thus concludes that SME as a

business sector do not see the benefits of adopting e-marketing as a marketing tool.

SMEs as such see cost as the most important barrier to adopting e-marketing.

5.5 Recommendation

To able to alleviate the barriers associated with the adoption of e-marketing among

SMEs, it is necessary that formal education and means of awareness creation be

introduced starting from national level so as the negative perception about the adoption

of e-marketing will be averted. E-marketing can hardly be effective unless firms and

individuals are educated about the opportunities that internet related technologies offer

to businesses and customers as well (Stansfield & Grant, 2003). Access to computers

and internet at the workplaces is important if e-marketing is to be enhanced but this is

not enough without education and training in the effective use of these tools for

marketing activities. Therefore, education and training should be initiated to increase the

level of information and also the computer literacy levels of owners and managers of

SMEs (O‟Toole, 2003). Consumer readiness was also rated as one of the most relevant

inhibitors of e-marketing adoption. There is therefore the need to encourage stakeholder

participation especially customers and other critical stakeholders on the benefits and

convenience of using electronic trading platforms.

Players in the internet industry should also seek to strengthen the internet capacity of

SMEs through the nurturing of e-marketing and the examination of the feasibility of a

local/regional mechanism to promote information sharing and capacity building with the

aim of enhancing and increasing the efficiency and competiveness of SMEs (Elliot

57
&Boshoff, 2007). This will go a long way in repairing the negative perception that

owners of SMEs have about the adoption of e-marketing in their businesses.

5.5.1 Areas of further studies

The study found cost, accessibility and consumer readiness as the factors affecting the

implementation of e-marketing within SMEs. These barriers and the various insecurities

they bring have inevitably reduced the popularity of adopting e-marketing strategies.

There is therefore the need for further studies on how e-innovations may be taken

advantage of, for the benefit of marketing especially within the small and medium

business fraternity at both the local and national platforms. This kind of study can be

conducted by both the academia or industrial expects with the view of establishing

relevant skills and techniques that may be needed to increase the efficiency of internet

marketing tools.

58
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 APPENDIX

KWAME NKRUMAH UNIVERSITY OF SCIENCE AND TECHNOLOGY

QUESTIONNAIRE

Dear Respondent,

This questionnaire is designed to collect data on FACTORS AFFECTING THE

ADOPTION OF E-MARKETING AMONG SMEs; CASE STUDY OF SELECTED

SMEs IN THE KUMASI METROPOLIS, ASHANTI REGION. The information

collected will be used for academic purposes only .You are guaranteed of absolute

confidentiality. Thank you for your cooperation.

Please Provide Adequate Answers To The Following Questions. Tick Or Write In The

Spaces Provided Thank You.

Part one:

1. Name of the organization

……………………………………………………………………………………
……………………………………………………………………………………
…………

2. Where is your organization located?

……………………………………………………………………………………
……………………………………………………………………………………
………

3. Nature of your enterprise

Manufacturing Trading Services
 Other, please
specify………………………………………………………

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 4. Please specify the age of the Owner/Manager
Less than 25 years 25-35 years 36-45 years
46-55 years Above 55 years
5. Educational level of owner/manager?
Primary High school Tertiary Vocational

6. How many employees work with your organization?

1-9 10-19 20-29 30-39
40-49 More than 50

7. What is the scope of your business activities?

Local National International

8. Is the business registered?

Yes No

Part Two: Internet usage and E-Marketing adoption level.

This part concerns the various factors affecting the adoption of E-marketing for business

transactions in the organization. E-Marketing in this research refers to conducting

marketing activities depending on electronic marketing tools and means such as:

Internet, Intranet, E-mail, Extranet and Mobile marketing. The following questions have

been designed to measure the various factors the affect the adoption of E-marketing in

the organization.

9. To what extent does management perceive the role of E-marketing in the

operations of the organization?

Very Unimportant Somewhat Unimportant Neutral

70
 Somewhat Important Very Important

10. From the statement below, please indicate your level of agreement or

disagreement to the following statements. Please use the scale below.

1= STRONGLY DISAGREE 2=DISAGREE 3=NEUTRAL 4=AGREE

5=STRONGLY AGREE
FACTORS AFFECTING THE ADOPTION 1 2 3 4 5
OF E-MARKETING AMONG SMEs
Owner‟s lack of awareness of the technology
Competition in the industry
Low use of internet by customers and suppliers
Low company literacy among SME owners
Electricity supply
Financial, technical and resource requirement
Government support
National ICT infrastructure
Organizational culture
Owner/manager skills
Perceived advantage
Perceived ease of use
Perceived usefulness
Security
Size of organization
Distrust on the use of online payment systems
Type of industry
Type of product/service
Lack of qualified staff to develop and support E-
marketing
High cost of website development
Lack of developed legal and regulatory systems
Internet fraud
Uncertain taxation rules

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 11. Please rate the following factors according to their importance to adopting E-

Marketing in your organization.

Factor Very Important Neutral Not Not Important

Important Important at all

Accessibility

competition

Consumer readiness

cost

Electricity supply

Financial, technical and

resource requirement
Government support

National ICT
infrastructure
Organizational culture

Organizational culture

Owner/manager skills

Perceived advantage

Perceived ease of use

Perceived usefulness

Security

Size of organization

Type of industry

Type of
product/service

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12. From the statement below, please indicate your level of agreement or

disagreement to the following statements. Please use the scale below.

1= STRONGLY DISAGREE 2=DISAGREE 3=NEUTRAL 4=AGREE

5=STRONGLY AGREE

EXTENT OF E-MARKETING 1 2 3 4 5
ADOPTION
The firm‟s owner thinks e-marketing
is important

E-marketing is a priority for the firm

Management of the firm is

committed to technologies like e-
marketing

We have a policy that encourages e-

marketing initiatives

The firm recognizes advantages

and/or disadvantages of e-marketing
utilization

Most of our employees are computer

literate

The company has a policy that

encourages e-marketing initiatives

The firm‟s business is compatible

with e-marketing business models

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13. From the statement below, please indicate your level of agreement or

disagreement to the barriers to adoption of E-marketing among SMEs. Please

use the scale below.

1= STRONGLY DISAGREE 2=DISAGREE 3=NEUTRAL 4=AGREE

5=STRONGLY AGREE

1 2 3 4 5
BARRIERS TO E-MARKETING
ADOPTION

Low level of technology usage within the

organization

Low level of literary among SME owners

Unconvincing benefits to the organization

Lack of qualified staff to develop and

implement and support web sites

Limited resources in terms of finance,

computers software and hardware

High cost of Internet Connectivity and

website

Inadequate transportation and delivery

network

Lack of online payment process

Limited availability of Online Banking

Services.

Lack of developed legal and regulatory

systems.

Lack of government support

Thank you for your assistance.

74