Chain Effects of Market Structure, Market Conduct and Performance of the Meetings, Incentives, Conferencing and Exhibitions Industry in Kenya

Abstract

MICE industry is a multi-billion dollar industry in developed destinations and compliments other forms on tourism. Reports from various resources indicate that MICE market is worth over thirty billion US dollars a year worldwide. It is known to have a higher multiplier effect in terms of job creation, foreign exchange earnings and environmental conservation among others. However, little is known about the structure, conduct and performance of the MICE industry in Kenya. A better understanding of the MICE industry will help government formulate better policies that would even propel the subsector further and would also help both the MICE service providers and consumers make even better decisions. It is for this reason that this study was commissioned. The purpose of the study was to investigate the relationship between market structure, firm conduct and performance of the MICE industry in Kenya. The specific objectives are to identify the challenges and threats in the Kenyan M.I.C.E industry, to examine the direct effect of market structure on performance, to analyse the influence of market structure on firm conduct, to analyse the influence of firm conduct on performance, to test the indirect effect of market structure on performance of the Kenyan M.I.C.E industry through firm conduct and to identify ways in which M.I.C.E industry in Kenya can be improved. The study was anchored on the Bain Structure–conduct–performance (S-C-P) theory. The study used descriptive and explanatory research designs. The study targeted 324 but sampled 179 MICE stakeholders. Data was collected using a questionnaire. Descriptive and inferential data analysis techniques were used. Additionally, factor analysis and multiple linear regression models were used. A response rate of 100% was achieved. The results from the data collected show that indeed, a numerous number of challenges hinder the growth and development of the MICE industry. A lot of possible solutions to these challenges were also given and thus can be seen as some of the ways in which the industry can be improved. The study also found that market structure had a direct effect on performance and also affected firm conduct. The study also found out that Firm conduct had a direct influence on performance of the MICE industry in Kenya however the indirect effect of firm conduct was not significant. The study recommended that government should develop MICE infrastructure, reduce interest rates, stabilise inflation and curb insecurity in order for the MICE industry to realize its full potential.