AN ANALYSIS OF CUSTOMER PREFERENCES ON TIME DEPOSIT PRODUCT ATTRIBUTES USING CONJOINT ANALYSIS

Abstract

With the appearance of various banks in Indonesia, the customers require to be more selective in determining which banks they can rely to save their money. There are a lot of banking products offered to the public every day. Time Deposit is one of the most popular products, because other than the function of Time Deposit as savings, it is also serves as a profitable investment tool with relatively small risk. The Time Deposit products have several attributes, and each of the attribute has its own value in customer perspective. The customer preferences are very influential in the decision of buying a product. Multivariate analysis has several methods to describe the preferences of the market, one of which is the conjoint analysis which is capable to describe the preferences of the people towards a product. It can also analyze the utility values of each attributes to create the most favourite combination of product attributes according to customer preferences. The purpose of this research is to find the attribute that is most important for customers to consider before opening an account of Time Deposit, and to evaluate the utility value of each attribute of Time Deposit according to the customer preferences using the conjoint analysis method, in order to find the most favourite attribute combination. This research is aimed to the society in Bandung who has the Time Deposit in a bank, or who may potentially become customers of Time Deposit in the future, with area sampling design method. The questionnaire as the primary data was spread directly to the respondent (person to person) randomly in several places in Bandung. From the research and data analysis, the conjoint process is capable to describe the customer preference using the stimuli that represent the combination attributes of Time Deposit product. The result of this research is that the most influence attribute in Time Deposit product according to customer preferences is Length of Period with 1 month as the favourite period, the second is the Interest Rate with 6.75% as the favourite rate, the third is Type of Withdrawal with Flexible as the favourite type, and the last is the principal Amount with total amount less than Rp.10 million as the most favourite Amount. According to the result, the most favourite attribute combination of Time Deposit is Principal Amount less than Rp.10 million, 1 month period with 6.75% Interest Rate, and Flexible type in which the deposit can be withdrawn anytime without any penalty cost.