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What is Customer Segmentation?
Customer segmentation is a strategic approach to dividing a customer base into distinct groups based on specific criteria. This method allows businesses to better tailor marketing and sales efforts to meet the unique needs and preferences of each segment. Through segmentation, companies can enhance their outreach, customize promotional strategies, and ultimately drive more personalized customer engagement and increased revenue.
How to Perform Customer Segmentation Using RFM?
The RFM Model was developed in the 90s by Jan Roelf Bult and Tom Wansbeek for catalog retail organizations.
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RFM (Recency, Frequency, Monetary) analysis is a proven marketing model for behavior-based customer segmentation. It groups customers based on their transaction history – how recently, how often and how much did they buy.
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RFM helps divide customers into various categories or clusters to identify customers who are more likely to respond to promotions and also for future personalization services.
RFM Customer Segmentation Model
RFM Customer Segmentation Summary Report
Possible Customer Segments from RFM
1.Champions
2.Loyal Customers
3.Promising
4.New
5.Abandoned Checkouts
6.Warm Leads
7.Cold Leads
8.Need Attention
9.Shouldn't Lose
10.Sleepers
11.Lost
Possible Actions to Take
Let Our Consultation at the Global Summit Help You in Leveraging Customer Segmentation to
