European Journal of Business and Management www.iiste.org ISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol.6, No.5, 2014 102 Marketing Strategies and the Performance of SMEs in Ghana Smile Dzisi 1* Daniel Ofosu 2 1. School of Business and Management Studies, Koforidua Polytechnic, P. O. Box KF 981,Koforidua,Ghana 2. Office of the Registrar, Koforidua Polytechnic, P.O.Box KF 981, Koforidua, Ghana * E-mail of the corresponding author: afuasmile@yahoo.com ofosu.daniel@gmail.com 2 Abstract Marketing strategies constitute one of the key functional strategies that Small and Medium Enterprises (SMEs) adopt to enhance performance. This study examines the effect of marketing strategies on the performance of SMEs in Ghana in terms of their profitability, brand awareness and market share. Data was collected through a survey research methodology. 363 SMEs were sampled from a population of 900 through stratified random sampling. Hypotheses were tested to ascertain the relationship between marketing strategies and performance. The overall results of this study suggest that strategic marketing are drivers of organizational positioning in a dynamic environment, and that it helps to enhance the development of new product/service for existing markets. Results of the study also reveal that the SMEs in Ghana mostly use traditional form of marketing to reach potential customers and also to entrench their brands. Interestingly, only few of them use modern technology in marketing their product and services; the SMEs should thus adopt more modern technological marketing tool such as mobile marketing to improve on their performance. The findings provide valuable insights for decision makers and SMEs owners on the relationship between strategic marketing and performance of SMEs in a globalized developing economy context. Keywords: Marketing strategies, strategic marketing, performance, SMEs, developing economy 1. Introduction In the current competitive business environment, marketing can be seen as a matrix of business activities organized to plan, produce, price, promote, distribute goods, service, and ideas for the satisfaction of relevant customers and clients. Achumba &Osuagwu (1994) posit that marketing is important for the success of any organization, whether service- or product-oriented. Chilya et al (2006) confirm that marketing performance is central to success in today’s fast moving competitive markets, and measuring marketing’s performance is critical to managing it effectively. The process of communicating the value of a product or service to customers, for the purpose of selling the product or service has become complex in recent times due to globalization. There is also the need to exceed the expectation of customers since satisfied customers : (i)are the organization’s least expensive customers; (ii)buy again and again; (iii) talk favourably about the business, which means free advertising; (iv) pay less attention to competition and (iv)tend to buy new products or equipment lines an organization may add later(Kotler,1988). As a result of this, organizations including Small and Medium Enterprises (SMEs) have realized the need to institute strategies that will help them gain an in depth understanding of the market, particularly with regards to their competitors and customers. Organizations achieve this objective effectively by considering the total marketing environment and its impacts on a company or product or service (Acker, 1988). The role of SMEs in economic development cannot be underestimated. According to Subrahmanya et.al (2010), policy makers, economists, and business experts admit that SMEs are the drivers of economic growth as they have contributed to over 50% of the Gross Domestic Product (GDP) and provided over 60% of the total employment in so-called developed, high income countries. Developing nations have also benefited from SMEs. In Ghana for instance, the sector accounts for about 70% of industrial employment and well over 50 % of the country’s GDP (Abor & Biekpe, 2007). In spite of their invaluable contributions to economic growth, SMEs increasingly face fierce competition from larger firms due to emerging technologies, innovation and relaxing trade barriers. The situation makes it difficult for the SMEs to survive or maintain their business position in the local and global market (UNCTAD,2004:5). Although it can be argued that the performance of SMEs is adversely affected in the global market, most of the enterprises in this sector in Africa and Ghana in particular have, in their own small way, adopted some marketing strategies that have enabled them survive the stiff competition over the years. As pertained in most developing countries, indigenous Ghanaian SMEs also experience lack of trained manpower, poor infrastructural development, lack of adequate or sufficient capital, and also face intense competition from superior foreign companies (Li et al., 2000). More importantly, owners of these businesses have understood the role that marketing strategies play in enhancing the performance of contemporary companies (Taiwo, 2010). The SMEs in Ghana have also recognize