A BAYESIAN-APPROACH FOR ANALYZING THE SERVICES OF BANKING INSTITUTIONS

This study illustrates an adaptive Bayesian framework for examining co nsumers' perceptions of the services of banking institutions in a targ et market. The approach uses multiple-measures data to estimate the si gnificant determinants of consumers' preferences for competing banks i n the market. This is accomplished essentially by incorporating prior structural information into analyses, information that Is used to obta in a stabilized version of the observed predictor-criterion covariance matrix. Bayesian structural regression estimates are shown to provide a banking institution with reliable information for use in positionin g itself in its financial marketplace. The paper also provides a numbe r of implications for the use of the methodology in practical marketin g response applications.