Crowdfunding and Marketing Performance of Microfinance Banks in Akwa Ibom State

Abstract

Crowdfunding has developed from being just a fundraising tool to a versatile marketing tool. Raising funds through crowdfunding has become a vital tool for start-up companies and most recently in the Microfinance banks to obtain investments they otherwise might not receive from more traditional sources such as banks, angel investors and stock markets. This adoption of crowdfunding for marketing purposes is not without its problems. Organizations would be well advised to consider not only the opportunities these platforms provide, but also their limitations, risks and the best crowdfunding platforms that will fit into their marketing objectives. In this regard, this study was carried out in order to assess the relationship between crowdfunding and marketing performance of microfinance banks in Akwa Ibom State. The researcher adopted a survey research technique in the study. The population size 16 microfinance banks within Uyo metropolis of Akwa Ibom State and a sample size of 366 employees was studied. The crowdfunding variables (independent variables) considered in the study were Equity-based Crowdfunding, Reward-based Crowdfunding and Lending-based Crowdfunding. The dependent variable was Marketing Performance. The hypotheses stated were tested using Spearman Correlation Coefficient at a 5% level of significance. From the data analysis, the major findings revealed a positive and significant relationship between Equity-based Crowdfunding and marketing performance of microfinance banks in Akwa Ibom State, (R = 0.770; P<0.05). The study revealed Reward-based Crowdfunding has having a positive and significant relationship on marketing performance of microfinance banks in Akwa Ibom State, (R = 0.855; P<0.05). The study also revealed that there is a positive and significant relationship between Lending-based Crowdfunding and marketing performance of microfinance banks in Akwa Ibom State, (R = 0.805; P<0.05). From the findings, it was concluded that there was a positive and significant relationship between Crowdfunding and marketing performance of microfinance banks in Akwa Ibom State. In line with this, it was recommended that companies, start-up businesses and financial institutions should adopt various crowdfunding platforms in their businesses as one of the means of raising finance for the company in order to boost their marketing performance.