The impact of Marketing Strategies on the Double Bottom Line of MFI’s:

A critical study

Submitted in partial fulfillment of the requirements

for the award of the degree of

Master of Business Administration (MBA)

To

Guru Gobind Singh Indraprastha University, Delhi

Guide: Submitted by:

Dr. ANU NAGPAL SUNIL KR. JOSHI

ASSISTANT PROFESSOR Roll No.: 00119103912

Gitarattan International Business School (Capital Letters)

Delhi – 110085

Batch (2012-2014)

1.1 TITLE OF PROJECT

The impact of Marketing Strategies on the Double Bottom Line (Financial and Social

Performance) of MFI’s: A critical study

1.2 INTRODUCTION TO STUDY

The microfinance sector has evolved from a grassroots level movement to a global industry

drawing millions of dollars of social investment. The sector is in a state of flux with the entry

of a diverse range of profit-oriented Microfinance Institutions (MFIs) and Non-Governmental

Organisation (NGO)-MFIs.

A majority of the MFIs claim to serve the dual purpose of increasing their outreach among

the poor and attaining financial self-sufficiency. The win–win prospects of microfinance,

whereby MFIs, Following principles of sound banking, would play a significant role in

poverty alleviation, have given rise to much euphoria.

Microfinance has emerged as an effective strategy to fulfil the small financial needs ot the

poor section of the society. It is a broad concept which refers to credit, savings, insurance,

remittance, pension and other financial products involving small monetary amount for low

income group people. MFIs are often confronted with decision to strike a trade-off between

financial and social performances, such as the interest rate structure, breadth and depth of

outreach. The financial and social performance targets may vary based on the MFIs social

mission, target customers, management strategies and location.

There is a need for innovation to enhance both financial and social performance. In such a

context, research can be conducted to ascertain whether MFIs can fulfil the double bottom

(i.e., financial and social performance) by developing appropriate strategies in response to

cloients requirements and market condition.

1.3 SCOPE & OBJECTIVES

1.3.1 Scope of the study

The present study is undertaken to understand the nature of the relationship between MFIs

(microfinance institutions) marketing strategies and financial and social performance. In

order to determine the impact of marketing strategies on the double bottom line (or financial

and social performance) of microfinance institutions, a multivariate model has been used

wherein the marketing strategies are the independent variables.

1.3.2 Objectives of the study The study is based on the following research objectives:

To study the relationship between MFIs marketing strategies and the double bottom

line (financial and social performance).

To study the moderating effect of the macro-environment (at country level) on the

relationship between marketing strategies and the double bottom line.

To study the moderating effect of the institutional structure (legal status of MFIs) on

the relationship between marketing strategies and the double bottom line.

1.4 RESEARCH METHODOLOGY

Research Design DescriptivePopulation/ Universe ---------------Sample Size 100Sampling Technique ConvenienceProject Approach Survey MethodInstrument Used Structured QuestionnaireData Type Primary and SecondaryStatistical Tools Employed Line Regression Model is usedTools SPSS, Microsoft Excel

1.4.1 RESEARCH DESIGN

A quantitative research design was deployed for the study. A questionnaire based on a on a

five point Likert scale as well as four point scale was administered to MFI officials. The

questionnaire is pilot tested in Delhi, India.

1.4.2 DATA ANALYSIS

The marketing strategies and social performance indicators have been condensed into latent

constructs. Subsequently multivariate test have been conducted to determine the impact of

marketing strategy sets on double bottom line (social and financial performance). The data

has also been layered based on non-profit and for-profit MFIs to measure the moderating

effect of the legal status on the relationship between marketing strategies and double bottom

line.

1.4.3 SAMPLE SIZE

Sample size represents the subset of the population. A small segment is selected from the

population and research is done on it. The sample size of 100 individuals is taken.