Determining bank preferences of depositors using conjoint analysis

Abstract

Market segmentation is considered crucial as an input to effective market penetration and service improvement, the same is true even in the banking industry. This study aims to determine the preferences of depositors in selecting a bank. The bank attributes examined are location, savings instrument, queueing system, banking days and value-added services. A market survey through conjoint experiment was undertaken involving n= 200 existing and n= 200 prospect bank depositors. The findings of the study showed that depositors mostly prefer bankslocated inside the mall, offers perks in the form of point system as value-added service, offers both ATM card and passbook as savings instrument, opens during weekdays and half-day during Saturdays, and implements number signaling system as a queueing system. Lastly, the study revealed that the most preferable combination of the attributes is a bank that is located inside the mall, offering both ATM card and passbook, implements number signaling system, is open during weekdays and half-day during Saturdays, and has a good standing in e-banking and m-banking system. Implications on this market research are also discussed.

Keywords: business administration, preferences, bank, conjoint analysis, Philippines