Examples of RFM analysis measures
Posted: Wed Jan 29, 2025 8:02 am
Once the RFM analysis ranking is complete, the next step is to perform the analysis in Excel.
Select all the columns you added for ranking
Create a PivotTable
Drag and drop R to the row labels, F to the column labels, and Customer ID to the value labels of the pivot table.
The closer to the top left of the analysis results Excel sheet, the less time has passed since the customer's last purchase, and the more frequent the customer (regular customer).
In this way, RFM jamaica cell phone number list analysis can be carried out using Excel.
So far, we have explained RFM analysis in detail, but let's take a look at three industries as examples of how this method is actually used.
Confectionery manufacturer
Let's look at an example of how a confectionery manufacturer uses RFM analysis.
One confectionery manufacturer aimed to improve customer loyalty.
Although we were collecting customer data, we were not able to utilize it effectively, and therefore were unable to implement the most optimal marketing approach.
Therefore, we conduct an RFM analysis and use the results to calculate the LTV of each customer, successfully classifying and analyzing them in our own unique way.
Even within the classification, different trends were observed depending on the LTV, so we created more detailed definitions such as "best value customers" and "high LTV general customers."
As a result, the direction of marketing strategies with the target becomes clear, enabling the design of specific KPIs (quantitative indicators used to measure and monitor the degree of achievement in the process of reaching the goal).
Cosmetics company
Let's look at RFM analysis for a cosmetics company.
A cosmetics company wanted to convert their existing customers into regular subscribers.
The reason was that sales, which were mostly from new customers, had declined, so they needed to increase sales from existing customers.
Therefore, we used RFM analysis to send emails of recommended cosmetics to customers whose last purchase date was more than a month ago and who purchase products infrequently.
One month later, we sent an email with information about a lotion that would be good to use together with the recommended product.
As a result, the customer did not just make a one-time purchase but also made a second purchase (increased repeat purchase rate).
The number of people making regular purchases increased, and as a result of conducting RFM analysis, we were able to successfully increase sales from existing customers.
Apparel Industry
Let's look at RFM analysis in the apparel industry.
One apparel manufacturer wanted to take good care of their long-time customers.
However, there were times when I gave directions to regular customers that were intended for new customers, which upset them.
This was because some of the staff were not aware of all the regulars.
Here, we conducted an RFM analysis, extracted data on loyal customers, and trained all store employees to memorize it.
As a result, they were able to provide proper customer service to their existing customers, which led to increased sales.
Points to note about RFM analysis
RFM analysis is a useful method for conducting appropriate marketing, but there are some things to keep in mind.
Select all the columns you added for ranking
Create a PivotTable
Drag and drop R to the row labels, F to the column labels, and Customer ID to the value labels of the pivot table.
The closer to the top left of the analysis results Excel sheet, the less time has passed since the customer's last purchase, and the more frequent the customer (regular customer).
In this way, RFM jamaica cell phone number list analysis can be carried out using Excel.
So far, we have explained RFM analysis in detail, but let's take a look at three industries as examples of how this method is actually used.
Confectionery manufacturer
Let's look at an example of how a confectionery manufacturer uses RFM analysis.
One confectionery manufacturer aimed to improve customer loyalty.
Although we were collecting customer data, we were not able to utilize it effectively, and therefore were unable to implement the most optimal marketing approach.
Therefore, we conduct an RFM analysis and use the results to calculate the LTV of each customer, successfully classifying and analyzing them in our own unique way.
Even within the classification, different trends were observed depending on the LTV, so we created more detailed definitions such as "best value customers" and "high LTV general customers."
As a result, the direction of marketing strategies with the target becomes clear, enabling the design of specific KPIs (quantitative indicators used to measure and monitor the degree of achievement in the process of reaching the goal).
Cosmetics company
Let's look at RFM analysis for a cosmetics company.
A cosmetics company wanted to convert their existing customers into regular subscribers.
The reason was that sales, which were mostly from new customers, had declined, so they needed to increase sales from existing customers.
Therefore, we used RFM analysis to send emails of recommended cosmetics to customers whose last purchase date was more than a month ago and who purchase products infrequently.
One month later, we sent an email with information about a lotion that would be good to use together with the recommended product.
As a result, the customer did not just make a one-time purchase but also made a second purchase (increased repeat purchase rate).
The number of people making regular purchases increased, and as a result of conducting RFM analysis, we were able to successfully increase sales from existing customers.
Apparel Industry
Let's look at RFM analysis in the apparel industry.
One apparel manufacturer wanted to take good care of their long-time customers.
However, there were times when I gave directions to regular customers that were intended for new customers, which upset them.
This was because some of the staff were not aware of all the regulars.
Here, we conducted an RFM analysis, extracted data on loyal customers, and trained all store employees to memorize it.
As a result, they were able to provide proper customer service to their existing customers, which led to increased sales.
Points to note about RFM analysis
RFM analysis is a useful method for conducting appropriate marketing, but there are some things to keep in mind.