Clients' preference for a car loan program in Digos City: A conjoint analysis
Keywords:
client preference, car loan program, conjoint analysis, additive model, PhilippinesAbstract
This study aims to determine the relative importance of attributes of car loan program as preferred by clients in the Southern Philippines – individually or aggregate. To do this, the study utilized the metric conjoint analysis (CJA) wherein 20 orthogonally-generated plancards representing combination of attribute levels for hypothetical car loan plans were rated in an online survey involving 200 respondents, with the goal of determining the best combination of attributes (i.e., downpayment, loan term and interest rate, mode of payment, and collateral). Results of the conjoint analysis revealed highest importance of mode of payment for car loan plans, insinuating that clients prefer payment flexibility the most, while collateral gained the least relative importance value. Specifically, the strong inclination for auto-debit arrangements as a mode of payment indicates a wider consumer desire for convenience and automation in financial operations. Implications of the findings, including the best and least- preferred combinations for a car loan program, are discussed in the paper.
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