Customer Segmentation

Customer segmentation is an excellent way to identify groups of customers for appropriate handling.

We are using this technique to improve your customer marketing and to provide you with 360 degrees view on your customers.

RFM Analysis

RFM (Recency, Frequency, Monetary) is an algorithm that will get you valuable analysis for your Customer Segmentation needs.

RFM considers recency, frequency and monetary values for each customer from transactional systems. We are combining those values and then group customers into different customer segments.

You are probably wondering how can you use your data to help up-selling your products.

The more you understand about your customers – the more efficient actions you can utilize.
For example,  is it true that customers who spend the most are your best customers? What if they purchased only once, or a very long time ago? What if they didn’t buy for a long time?
If you want to up-sell customers, who should you contact, pay attention to? Who are the customers you are likely going to lose?
RFM Customer Segmentation can help you with all these questions.

RFM technique is a proven strategy based on customer behavior segmentation.

How we can help?

All the data we need is right there, in your database. Waiting for you to discover your segments, retain them and talk to them.
We will help you find your champions, loyal customers, who have shown you constant love; Customers that can become your champions; unfaithful ones, but good spenders in the past; the ones who you are about to lose because if you don’t do anything; the ones you already lost to a competitor.

So, the RFM segmentation technique is based on analyzing three quantifiable factors.

These are:

Recency: How much time has elapsed since a customer’s last activity (purchase) or transaction?

Frequency: How often has a customer transacted or interacted during a particular period?

Monetary: How much a customer has spent during a particular period.
Every customer will be given a final “score” based on recency score, frequency score, and monetary score. With that final score, we are building your segments.

What can you do with segments?

With the results of customer segmentation in place, you can establish specific messaging that is tailored for each customer group. RFM marketing allows marketers to communicate with customers in a much more effective manner.


Just a few examples on 3 segments:

Best Customers, “Champions” –  These customers most likely generate a high percentage of total revenues and thus focusing on keeping them happy should be a top priority.

High-spending New Customers – these new customers spent a lot on their first purchase, so it is super important to make them feel valued and appreciated – and to give them some great incentives to continue buying.

Lost Best Customers – these are valuable customers who stopped buying a while ago. It’s hard to re-engage churned customers, but the high value of these customers makes it worthwhile trying.

Ready to increase long-term customer loyalty and lifetime value?

Contact us now