How to Identify and Nurture Your Best Customers

Today is all about finding your soulmates and lovers (no, not like that).

We are talking about your best customers: the people who connect with your brand, keep coming back for more, and praise you to anyone who will listen. You find them in your own purchase data. Score every customer on how recently they bought, how often they buy and how much they spend, and the customers at the top of all three scales are your best ones. This is RFM analysis, and it is the method large, global retailers use.

Below: how to define a best customer, how to identify them with RFM, how to build a profile of what they share, how to keep them happy with a Customer Value Optimization (CVO) approach, and how to turn more of your customers into best customers.

What makes someone a "best customer"?

The notion of "best customers" varies from business to business.

For businesses that sell one-time products or services, such as a real estate agency or a wedding dress supplier, the best customers might be the people who recommend the brand and bring new customers on board. Retailers who sell consumable products (wellness, fashion, groceries) will usually define best customers as those with a high purchase frequency and a high Average Order Value.

To cover both cases, here is a checklist that defines a best customer in any industry. Your best customer is someone who:

The first four traits you can read from data. The last two you learn by talking to people. Both matter, but start with the data, because it is harder to argue with.

How do you identify your best customers with RFM?

You might have a hunch about who your best customers are. Back it up with data anyway, and steer clear of preconceived ideas. It is said that those who cannot change their minds cannot change anything else. If you believe you know your way around your customers' minds without proof, your competitors will eat you alive.

At Omniconvert, we are die-hard fans of RFM segmentation, a method large, global retailers use to make sense of their customer data and quickly separate their best customers from the rest of the customer base. The RFM model looks at each customer's purchase history and sorts customers into sub-groups based on a 1–5 score for each of the three variables. If RFM is new to you, start with our complete guide to RFM segmentation, or the shorter explanations of the RFM model and the RFM score.

The strength of RFM is that it runs on your first-party data. Every insight comes from real past behavior, so you remove the guessing and increase the accuracy of what you find.

1. Pull the purchase history

   For every customer, collect three data points: the date of the last order, the number of orders, and the total amount spent. Use one fixed time window for all customers.
2. Score Recency from 1 to 5

   How recently did the customer buy? The most recent buyers get a 5, the customers who have not bought for the longest time get a 1.
3. Score Frequency from 1 to 5

   How often does the customer order? The customers with the most orders get a 5.
4. Score Monetary value from 1 to 5

   How much does the customer spend? The customers with the highest total spend get a 5. On every scale, the higher the score, the higher the customer's value.
5. Group the score combinations into segments

   Each customer has one R, one F and one M score at any given moment. The combinations place customers in segments. We use 11 segments, and the two that hold your best customers are Soulmates and Lovers.

Soulmates (R=5, F=5, M=5)

Soulmates are the finest, most elite group in your customer base. They bought recently, they buy the most often, and they spend the most.

Lovers (top Recency and Monetary value, Frequency just below)

Lovers do not buy quite as often as Soulmates, but their purchase behavior is otherwise very similar. That is why they belong in the best-customer category too.

For people who keep buying, the RFM scores and repeat customer status line up. The difference is that RFM also tells you how valuable each repeat customer is and whether they are drifting away.

Why are your best customers worth the effort?

Soulmates and Lovers share a real interest in your products and your organization. Their satisfaction is high, so you do not need to worry as much about marketing to them. They cut your work in half, because they have already made progress with your help.

Your best customers will continue to buy from you even when they meet obstacles, such as a complicated checkout. They will also spread the word: they encourage others to buy your products, read your blog, subscribe to your newsletter and follow your social media channels.

These loyal customers are highly profitable, because you only need to acquire them once. After that, your job is to help them keep the habit of buying from you. Because of their strong attachment to your company, they generate significant value and need little effort to stay satisfied.

In short, you have won their love and loyalty for the long haul.

You will often read that about 80% of revenue comes from the top 20% of customers. That split is the Pareto principle, a rule of thumb rather than a measured law, and your own ratio may be quite different. What holds in most stores is the direction: a small group of customers produces a large share of revenue. Calculate your real share from your order data before you plan around it.

Because marketing is less of a concern with this group, put the effort into the relationship instead: build a deep connection, and never take Soulmates and Lovers for granted.

How do you build a best-customer profile?

With your best customers identified, look at the characteristics these people share and build a picture of them. This profile is the base for your Ideal Customer Profile (ICP). For how to turn it into a full ICP definition, see our guide on how to identify your ideal customer.

The process is similar to creating a buyer persona, with one advantage: the profile is based on real data instead of assumptions. Include the following three categories so you know your best customers at a granular, even intimate, level.

Personal data: demographic, psychographic, behavioral

Pay attention to customer values and how they align with yours, to their personal attributes, and to who these customers are as people. Only when you know who they are and what they need and expect from you can you design retention and loyalty programs that keep your best customers engaged and remove the reasons to churn.

Professional information

Knowing what your best customers do for a living helps you understand their needs and preferences, so you can adjust your processes to fit. Even if you sell consumable products, the professional side tells you a lot about lifestyle, interests and buying habits.

For example, if your best customer is a busy professional who travels a lot, adjust your shipping options so that delivery never becomes an inconvenience that affects retention.

Pains and struggles

For this part you need qualitative insight: interviews and surveys about the challenges your best customers face. It is a long process, and a crucial one. The one sure way to keep best customers coming back is to deliver undeniable value and help them make progress in their lives.

To do that, you must understand what these people want to change in the first place. Walk a mile in their shoes. Jobs-to-be-Done interviews are a structured way to do it. You can only create the products, processes and experiences people truly want when you see the world from their point of view.

How do you turn more customers into best customers?

Here is a customer-focused approach to growing the number of Soulmates and Lovers, based on the Customer Value Optimization methodology.

1. Determine all the types of customers you have

   We use 11 RFM segments for our clients' customer bases. If your business is not big enough for that level of detail, sort customers into four main categories: Power, Active, At-Risk and Lost. This gives you a clearer picture of how healthy the business really is. For example, if at-risk customers outnumber active customers, something is wrong with the customer journey, and you need to stop and fix it as soon as possible.
2. Research customers' behavior, motivations and needs

   You cannot improve what you do not measure, or solve a problem you do not understand. Use qualitative research, such as interviews, surveys and focus groups, to learn what stops customers from buying more often or spending more. Turn the insights into an action plan for fixing what is broken in the customer journey.
3. Create customer experiences with a purpose

   Steer away from mediocre experiences and guide customers through the journey by offering real value. Find out what customers need, then deliver it. Some customers need help using your product; others want more payment options. When you adapt your processes to customer needs, you show that you care, and that is often enough to earn loyalty.
4. Tailor your marketing to each RFM group

   Every campaign should serve one purpose: Retention, Prevention or Reactivation. Instead of pushing products onto customers or manipulating them into buying, make it easier for them to discover and use your products. Campaigns with real meaning build a group of loyal customers and move lower segments up toward Soulmates and Lovers.
5. Acquire more customers like your best ones

   Early advertising promoted random products to broad audiences with general copy. Rising acquisition costs forced a change. Now the smarter approach is to build your audiences around your best customers and promote the products they love most. Acquisition takes more work this way, but best customers bring in much more revenue than bargain hunters. See our guide to customer acquisition strategy.

Nexus by Omniconvert scores your customer base into RFM segments and pushes those segments directly to Meta Ads, Google Ads and Klaviyo. You can run retention campaigns for each group and use your Soulmates and Lovers as the source audience for acquisition.

How do you take care of your best customers?

Taking care of your customers will (almost) always come down to personalization and relevance. In more technical terms, to keep your best customers from churning, you need prevention campaigns built on your best-customer profile.

Many consumers are not only looking for the cheapest option. They want products and services that fit their needs and their journey, and many want a real relationship with the brands they support. That makes your customer relationship management crucial.

One principle should guide you here: no one owes you their business. You need to sell your products and you need a strong, loyal customer base, but that does not mean people will come. It is a two-way street.

If customers appreciate your brand, buy from you regularly, spend their salaries on your products and bring new customers through referrals, you have to do something in return. Show your gratitude with rewards, personalized emails and handwritten thank-you cards. This strengthens their loyalty to your brand and makes them more likely to tell their peers about you.

Last but not least, understand what progress customers are trying to make with your products, then spare no effort to help them reach it.

For example, say you are a fitness retailer. Your best customers probably have different fitness goals: losing weight, building muscle, or getting stronger. Each goal needs a different approach, and you need to be tactful in how you communicate. People who want to lose weight might need a training program recommendation; people who want to build muscle might need protein supplements. When you understand their objectives, you can give advice and recommendations that help them get there.

Small, consistent, customer-centric actions keep the relationship meaningful and give your best customers no reason to churn. To test which of those actions actually work, you can run the experiments and on-site surveys with Omniconvert Explore.

Frequently Asked Questions