Travel Agencies Response To Internet Evolution In Nairobi County: An Analysis Of Competitive Strategies

ABSTRACT

Innovations in internet advances have brought diverse challenges and opportunities for the travel agency sector. This study analyzed the implications of internet advances and the competitive strategies adopted by travel agencies in Nairobi County. It specifically evaluated the extent to which travel agencies have adopted and use internet developments, challenges and perceived benefits of the internet advances, the competitive strategies adopted to cope with the internet advances and the extent to which the Government of Kenya policies in ICTs facilitate travel agencies’ to cope with internet innovations. The study used a conceptual framework and Diffusion of Innovation Theory in order to relate theory to practice. A mixed approach was used, which incorporated survey design, analytical design and concurrent transformative strategy. The research used census to include all the (Kenya Association of Travel Agent) travel agencies in Nairobi and purposive approach to select the respondents. The study focused on all the 74 travel agencies which are registered by Kenya Association of Travel Agents (KATA) in Nairobi, the ministry of tourism and Kenya Data Network Limited. However, 55 travel agencies responded with a sample size of 110 respondents. Data was collected by use of questionnaires, documentary analysis and semi-structured interviews. The chief ICT officer from the Ministry of Tourism and external affairs manager at Kenya Data Network Limited responded to the interviews. Data analysis involved use of thematic, descriptive statistics and structural equation modeling to establish the relationships between the dependent and independent variables. The results of the study established that TAs in Nairobi are mainly family and independent businesses. They offer amalgamation of services and target diverse clientele as a strategic approach. They are aware of multiplicity of ICTs in existence, nonetheless, their core reason for internet adoption relates to the critical source of information necessary for business transactions. Further, the internet advances adoption depends on the need, relevance and perceived internet benefits. Internet facilitates information processing, storage, accessibility of information, increased efficiency, wider coverage, cost effectiveness and networking. The main challenges travel agencies encounter included loss of clients through disintermediation, cost of coping with the internet dynamism and also lack of ICTs expertise and lack of government support. The main strategies adopted are going online, customer relationship management, product diversification and continuous training of staff. The legal environment within which TAs operate is unsystematic and lack updated laws that would assist them cope with the technological shift. Additionally, the study established that there exists a relationship between the internet advances and the strategies adopted by the Travel Agencies, the perceived internet benefits and the strategies adopted. However, there is no relationship between the extent of internet adoption and use and the strategies adopted by travel agencies in response to the internet developments. The study proposes to the government of Kenya through the Ministry of East Africa Affairs, Commerce and Tourism to provide the necessary enabling environment to enhance travel agencies adopt the dynamic ICT advances and the best strategies in the global value chain.