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RFM Articles

This section is dedicated to RFM – a method that is getting more and more popular among ecommerce marketers because it allows them to measure customer value by looking at existing purchase data.

 

The RFM model allows you to attribute a score to each customer based on three factors Recency (R), Frequency (F), and Monetary Value (M). After you calculate the RFM score for each existing customer, you can group your customer base into segments based on their purchase history. You can do this either manually, by exporting customer data and calculating the score for each customer, or automatically, by using a dedicated RFM analysis and segmentation tool.

 

RFM has a direct impact on customer retention and customer value optimization. Dive deeper into RFM analysis & segmentation to find how you should treat each RFM segment, what RFM segments to concentrate on and how to use RFM segmentation to generate more valuable customers.

Did you know that there's a tool for Customer Value Optimization?

It’s called Reveal and it uses automated segmentation and insights based on your first-party data to help you increase the number of loyal customers and improve Customer Lifetime Value.

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