FACTORS INFLUENCING CUSTOMERS' BANK SELECTION DECISIONS: IN THE CASE OF SELECTED COMMERCIAL BANKS IN WORABE TOWN

Abstract

Understanding how consumer behavior influences bank selection is crucial for banks to attract and retain depositors. By examining consumer behavioral factors, banks can customize their strategies to align more effectively with the needs and preferences of their target customers, thereby enhancing both profitability and liquidity. Hence, this research explores the specific factors that Werabe town bank users consider when choosing a bank for their banking activity. Data were collected using self-administered questionnaires to a sample of 399 of Bank customers. Their responses rate (100%) 399 valid on the importance of 6 different selection criteria were rated and analyzed. Mean analysis is applied to rank the most important determinants of bank selection. The collected data were analyzed through SPSS version (20). The descriptive and inferential statistical tools such as mean, percentage, ANOVA, correlation and multiple linear regressions were used to analyze collected data. The regression model summary shows that the all independent variables explain 73.2% variability on bank selection decision. The findings revealed that; Convenience factors, Promotion factors, Service quality, Bank brand factors and Relationship factors, have a significant and positive effect on bank selection decision while Security factors have insignificant effect on bank selection decision. As customers place more concentrate on factors like Convenience, Promotion, Service quality, Bank brand and Relationship, such factors healthier to be. Considered seriously by banks in their marketing strategies which help them to attract new as well as retain the existing customers.