THE PRODUCT TEST SURVEY

1
THE PRODUCT TEST SURVEY
By Dorota Szubert
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AGENDA
METHODOLOGY
BASIC CHARACTERISTICS OF CLIENTS
DECISION MAKING PROCESS AND PRODUCT USE
FINANCIAL MARKET PARTICIPATION
THE PRODUCT EVALUATION
DEMAND
DEMAND SEGMENTS
DEMAND IN VILLAGES
3
METHODOLOGY
4
BASIC CHARACTERISTICS
5
BASIC CHARACTERISTICS
6
MAIN INCOME GENERATING ACTIVITIES
7
INCOME GENERATING ACTIVITIES
8
OTHER CHARACTERISTICS
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ECONOMIC SITUATION
10
EXPERIENCE WITH MDF KAMURJ CURRENT CLIENTS
11
GROUP NAME CURRENT CLIENTS
N123
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LOAN IMPACT ACCORDING TO CURRENT CLIENTS
Loan helped to expand the business more often
involved in other activity than breeding or land
cultivation, among those with highest income,
good access to a market, investing in breeding,
harvesting, wood. Loan caused no changes among
those with lowest income, poor access to a
market, paying off debts.
N123
13
DECISION MAKING PROCESS AND
PRODUCT USE
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KNOWLEDGE ABOUT SWALLOW LOAN POTENTIAL CLIENTS
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ATTEMPTS TO OBTAIN SWALLOW LOAN POTENTIAL
CLIENTS

• Reasons for not receiving the loan
• I did not like the conditions
• It is in the process

No statistically significant difference
16
SOURCES OF INFO ABOUT SWALLOW LOAN
Potential clients living in potential villages
more often heard of Swallow loan from loan
officers, less often from other villagers and
from a leaflet than those living in villages
covered by the pilot test.
17
REASONS FOR TAKING SWALLOW LOANCURRENT CLIENTS
Other mentioned on time loan, not much time
required / not many formalities, loan duration,
trustful organization, RPM way, new loan when
prepaid.
N123
18
PURPOSES OF TAKING SWALLOWCURRENT CLIENTS
N123
19
IMPORTANCE OF PURPOSES OF TAKING
SWALLOWCURRENT CLIENTS
20
DECISIVE PERSONCURRENT CLIENTS
I decided myself no other source of income,
living in medium size villages ( of people) I
co-decided one additional source, living in
small or big villages
N123
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DECISION MAKING PROCESS AND PRODUCT USE KEY
FINDINGS CURRENT CLIENTS
?

• The main source of information about Swallow loan
  are loan officers and other villagers both for
  potential and current clients
• POTENTIAL CLIENTS
• Potential clients are rather knowledgeable about
  Swallow loan (19, 60 in current villages). Some
  of them have made some attempts to obtain Swallow
  loan (these are richer people)
• CURRENT CLIENTS
• Main benefits are connected with product and its
  characteristics (no collateral, mobile banking,
  good conditions, no beauracracy)
• Interestingly, 20 mentioned they took this loan
  as there is no other financial provider in the
  area
• Loan money was in most cases spent on inputs
  (66), land cultivation (58and cattle purchase
  (40). These purposes were also indicated as most
  important ones
• Such purposes as debt, family expenses, education
  expenses are mentioned only by a few clients
  mostly as the third important expenditure
• Most of clients made a decision about taking a
  loan together with other family members (76).
  This answer was more often indicated by those
  with one or more additional source of income,
  living in small or big villages

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FINANCIAL MARKET PARTICIPATION
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OTHER SOURCES USED IN THE PAST (1 off 2)
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OTHER SOURCES USE IN THE PAST (2 off 2)
Potential clients living in potential villages
more often have used USDA, UMCOR AREGAK while
less often have used family / friends and
moneylenders than those living in currently
covered villages.
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CURRENT USE OF OTHER SOURCES
26
(No Transcript)
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FINANCIAL MARKET PARTICIPATION KEY FINDINGS
?

• More than one third clients have used competitive
  sources
• The main source is ACBA, however it has been more
  often used by current clients. Potential clients
  more often have used UMCOR AREGAK (potential
  villages)
• Potential clients (particularly in potential
  villages) are more prone to use competitive
  sources
• Both past and current users are generally richer
  than non-users

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THE PRODUCT EVALUATION
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OVERALL SATISFACTION CURRENT CLIENTS
Min.3 Max. 5 Mean 4,33 Median 4 Stand.
dev. 0,67
N123
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PROFILE OF OVERALL SATISFACTION GROUPS
Nearly significant
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SATISFACTION WITH DETAILED ASPECTS
CURRENT CLIENTS
N122-123
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SATISFACTION WITH DETAILED ASPECTS
CURRENT CLIENTS
N122-123
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HOMOGEITY OF SATISFACTION CURRENT CLIENTS
Dispersed dissatisfaction
Dispersed satisfaction
Adjustment threshold (mean value for all aspects
calculated for each respondent separately)3,89
Standard deviation
Homogenous dissatisfaction
Homogenous satisfaction
Mean
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SATISFACTION SUMMARY CURRENT CLIENTS
Adjustment threshold (mean value for all aspects
calculated for each respondent separately)3,89
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SWOT CURRENT CLIENTS
Cost / advantage
Maintain
Mean
Less important
Improve
Influence on overall satisfaction
(on the basis of correlation analysis)
high
low
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PERCENTAGE OF NEEDS SATISFIED
CURRENT CLIENTS
Min.0 Max. 100 Mean 61,53 Median 60 Stand.
dev. 27,61
N122
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APPROPRIATE LOAN SIZECURRENT CLIENTS
Min.60000 Max. 3000000 Mean 385217 Median
300000 Stand. dev. 408333
N115
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SATISFACTION KEY FINDINGS CURRENT CLIENTS
?

• Relatively high overall satisfaction (89
  satisfied), but 45 is definitely satisfied
• More satisfied are female, with good access to
  the market, living in villages with no access to
  competitive sources, in Gyumri, Mayisyan
• Aspects evoking the highest satisfaction are
  staff professionalism and staff politeness
  (homogenous satisfaction)
• Aspects evoking the lowest satisfaction are
  mostly those connected with prices
• interest rate (75 dissatisfied or hesitating
  about evaluation)
• group size (59)
• upfront charge (54)
• group guarantee (47)
• passbook payment (45)
• However only interest rate is of high importance
  for clients
• The other aspects needing improvement are loan
  size and loan term
• Swallow loan seems to fulfill the needs towards
  external financing to the limited extent. Though
  the mean value is relatively high (almost 62),
  48 has less than 50 needs satisfied

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FIRST REACTIONS TO THE PRODUCT POTENTIAL CLIENTS
Answers do not sum up to 100
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POSITIVE REACTIONS TO THE PRODUCT POTENTIAL
CLIENTS
Answers do not sum up to 100
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NEGATIVE REACTIONS TO THE PRODUCT POTENTIAL
CLIENTS
Answers do not sum up to 100
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NEUTRAL REACTIONS TO THE PRODUCT POTENTIAL
CLIENTS
Answers do not sum up to 100
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LIKESPOTENTIAL CLIENTS
Answers do not sum up to 100
44
DISLIKESPOTENTIAL CLIENTS
Answers do not sum up to 100
45
SATISFACTION KEY FINDINGS POTENTIAL CLIENTS
?

• Potential clients usually react positively to the
  product
• As the main product strengths lack of collateral
  and loan delivery is mentioned
• The loan term may be also considered as the
  strength, but only in current villages judging by
  the relation of mentioned likes (55) to dislikes
  (25)
• The main weakness is group size (66) and group
  guarantee (51)
• Interestingly such characteristics as the
  repayment frequency, loan amount and number of
  formalities are equally liked as disliked
• Price should not be considered as a weakness
  (32) as it was mentioned by 23 as strength
  (particularly potential villages)

46
DEMAND
47
WILLINGNESS TO RECOMMEND SWALLOW LOAN CURRENT
CLIENTS
Min.1 Max. 5 Mean 4,42 Median 5 Stand.
dev. 0,88
N120
48
INTENT TO TAKE ANOTHER SWALLOW LOAN CURRENT
CLIENTS
Min.1 Max. 5 Mean 3,95 Median 4 Stand.
dev. 0,94
N123
49
PROFILE OF GROUPS CURRENT CLIENTS
Nearly significant
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REASONS FOR SWALLOW REJECTIONCURRENT CLIENTS
WHO DO NOT WANT THE NEXT LOAN
high IR 6 people I think I will have enough
money 1 Loan size too small 2 short loan
duration 3 group guarantee 1 up-front 1 RPM
schedule 1
All people unwilling to take a loan are
price-sensitive (all complain about price).
N120
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AREAS FOR SWALLOW IMPROVEMENTCURRENT CLIENTS
WHO WANT THE NEXT LOAN OR ARE HESITATING
11 people have no complaints
N106
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LOYALTY KEY FINDINGS CURRENT CLIENTS
?

• Regarding main loyalty indicators 88 is going to
  recommend Swallow loan (60 definitely), while
  85 is going to taken next loan (29 definitely)
• More willing to recommend are those who better
  evaluate loan impact
• More willing to take the next loan are older,
  living closer to the branch
• Main reason was Swallow loan rejection is price.
  The other is short loan duration
• Those who are willing to take the next loan also
  complain about interest rate and loan duration

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WILLINGNESS TO BUY A PRODUCT POTENTIAL CLIENTS
No statistically significant difference
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PROFILE OF GROUPS POTENTIAL CLIENTS
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PROFILE OF VILLAGES POTENTIAL CLIENTS
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REASONS FOR PRODUCT REJECTIONPOTENTIAL CLIENTS
Potential clients living in potential villages
more often think product generally is not
acceptable, complain about group guarantee and do
not consider taking a loan at all. They less
often think this loan is risky, expensive or
group size is too big.
Answers do not sum up to 100
57
REASONS FOR PRODUCT APPROVALPOTENTIAL CLIENTS
Answers do not sum up to 100
58
LOAN PURPOSESPOTENTIAL CLIENTS
Answers do not sum up to 100
59
BEST MONTHS FOR LOAN TAKINGPOTENTIAL CLIENTS
Answers do not sum up to 100
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WILLINGNESS TO RECOMMEND A PRODUCT POTENTIAL
CLIENTS
61
PROFILE OF GROUPS POTENTIAL CLIENTS
62
PROFILE OF VILLAGES POTENTIAL CLIENTS
63
WILLINGNESS TO BUY KEY FINDINGS POTENTIAL
CLIENTS
?

• More than half of potential clients is willing to
  buy the product (85 current clients)
• Usually these are people with some experience in
  financial market, men
• Obviously more willing to buy are people living
  in villages covered by the pilot test
• Main reason to reject the product is lack of need
  / acceptance for a loan
• Loan is perceived to be the best for such
  purposes as cattle breeding (more often current
  villages) and land cultivation. The latter is one
  of the main purposes for current clients as
  well)
• Spring months are the best for loan taking
• Nearly 80 is willing to recommend (more often
  current villages)
• This result is similar to result of current
  clients
• Usually more willing to recommend are male, with
  better access to the market, better off

64
DEMAND SEGMENTS
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PROFILES OF CLIENTS CURRENT CLIENTS
Overall satisfaction
Willingness to recommend
Percentage of needs satisfied

• Correlations
• Intent to repurchase does not correlate to any
  indicator besides willingness to recommend
• Willingness to recommend is strongly correlated
  with all other indicators, it is the strongest
  related to intent to repurchase
• Thus, breakdown of these two variables should be
  taken as an indicator for retention (they explain
  75 of it)

N120 -123
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PROFILES OF CLIENTS - RETENTION CURRENT CLIENTS
Segments 1 prospective (willing to recommend
and repurchase) 72 2 lost (not willing to
recommend and repurchase) 10 3 under question
mark (willing to either to repurchase or
recommend) 18
N120
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SEGMENTS CURRENT CLIENTS
Branch
Village
N120 -123
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PROFILES OF SEGMENTS CURRENT CLIENTS
69
SEGMENTS DIFFERENCES IN SATISFACTION CURRENT
CLIENTS
70
SEGMENTS OTHER CHARACTERISTICS CURRENT CLIENTS
71
COMPLAINTS OF LOST CURRENT CLIENTS
high IR 10 people (out of 12) Loan size too
small 5 short loan duration 4 RPM schedule 3
72
SWOT CURRENT CLIENTS - PROSPECTIVE
Cost / advantage
Maintain
Mean
Less important
Improve
Influence on overall satisfaction
(on the basis of correlation analysis)
high
low
73
SWOT CURRENT CLIENTS - UNDER QUESTION MARK
Cost / advantage
Maintain
Mean
Less important
Improve
Influence on overall satisfaction
(on the basis of correlation analysis)
high
low
74
SEGMENTSCURRENT CLIENTS
?

• After breakdown of intent to repurchase and to
  recommend three segments were created lost
  (neither willing to recommend no to repurchase),
  prospective (both willing to recommend and
  repurchase) and under question mark (either
  willing to recommend or to repurchase)
• The majority are prospective (72). More often
  these are older people, with low and medium
  income. They are more satisfied with most of
  detailed aspects. Swallow loan meets most of
  their financial needs and more often than other
  groups they have no experience with competition.
  The only area for improvement is loan term and
  interest rate
• The next biggest group are those under question
  mark (18). They are middle age or older, have
  the highest income. Swallow loan satisfies their
  needs to the average extent. They are more often
  ACBA users. To attract this group loan size and
  group formation process should be changed
• The smallest group are lost ones. They are
  younger, with lowest income. They are less
  satisfied with most of Swallow loan
  characteristics. They have some experience with
  competition. Swallow loan satisfies their needs
  to the low extent. They mainly complain about
  price

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PROFILES OF CLIENTS - RETENTION POTENTIAL
CLIENTS
Segments 1 prospective (willing to recommend
and purchase) 54 2 lost (not willing to
recommend and purchase) 17 3 under question
mark (willing to either to purchase or recommend)
29
N120
76
SEGMENTS POTENTIAL CLIENTS
No statistically significant difference
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PROFILES OF SEGMENTS POTENTIAL CLIENTS
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SEGMENTS POTENTIAL CLIENTS
?

• Similarly as in case of current clients the
  majority are prospective 54 (72 current)
• More often these are older people
• The next biggest group are those under question
  mark 29 (18)
• They are middle age, better off
• The smallest group are lost ones 17 (10)
• They are better off

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DEMAND ESTIMATION IN VILLAGES POTENTIAL CLIENTS
80
DEMAND ESTIMATION IN VILLAGES POTENTIAL CLIENTS
81
DEMAND ESTIMATION IN BRANCHES POTENTIAL CLIENTS
82
DISCUSSION

• WHICH GROUPS SEEM TO BE MOST PROMISING FOR MDF
  KAMURJ? WHY? / DO YOU FEEL TARGET GROUP SHOULD BE
  NARROWED? TO WHAT GROUP?
• ANY CHANGES IN THE PRODUCT?
• WHAT VILLAGES ARE THE BIGGEST POTENTIAL FOR MDF
  KAMURJ? WHY?
• WHAT VILLAGES ARE NOT PROMISING? WHAT MAY BE THE
  REASON?
• WHAT DECISIONS WOULD YOU MAKE BASED ON THESE
  RESULTS?
• WHICH RESULTS WOULD YOU INCORPORATE INTO
  FINANCIAL PROJECTIONS? WHY?

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ANNEXPRO-ACTIVE ATTITUDEPREFERENCES TOWARDS
OTHER PRODUCTSCHARACTERISTICS OF SATISFACTION
GROUPS
84
MOST DIFFICULT OBSTACLES
N122
85
THINGS ADDRESSING OBSTACLES
CURRENT CLIENTS
POTENTIAL CLIENTS
86
ACTIVITY

• Potential clients (no differences between
  currently covered and potential villages)
• Organization was settled down to
• Address Irrigation problem (10 people)
• Elections (8 people)
• Create of village assosiations or teams (7
  people)
• Repair roads, street
• Clean water source
• Electricity problem
• Privatization
• TV station for the village
• Problem with group loan
• Solve consequences of the hail
• Gazification
• Training on agribusiness
• Work on youth problems
• Planting trees
• They turn for help to

• Current clients
• Organization was settled down to
• Get humanity aid
• Organize a party
• Privatize a garden
• They turn for help to
• - a village council
• Marzpeteran
• other
• Results were neither positive not negative.

N123
87
PREFERENCES FOR OTHER SERVICES
N123
88
CREDIBILITY OF INFORMATION
N121
89
APPLICATION PROCESS
90
PROCESSING TIME CLARITY OF APPLICATION FORMS
91
GROUP FORMATION FLEXIBILITY OF LOAN AMOUNTS
92
LOAN TERM
93
REPAYMENT FREQUENCY
94
LOAN SIZE
95
PROPERTY REQUIRED
96
GROUP GUARANTEE SYSTEM
97
GROUP SIZE
98
PASSBOOK PAYMENT and WAY OF LOAN REPAYMENT
99
AFFORDABILITY OF INTEREST RATE
100
UPFRONT FEE
101
CLIENT SERVICE