RFM Analyisis

How RFM Analysis can give you a lift

Who to mail? Who to leave out?

Direct Mail is expensive. Who do you mail, who do you leave out, so that your mailing produces the greatest profits? The most popular and easy to implement segmentation for the house file is RFM Analysis (which stands for Recency, Frequency, and Monetary value).

RFM Analysis has the advantages of being simple and easy to understand. When properly set-up, and enhanced with product purchase information, it is more than adequate for most B2B Direct Marketers.

With RFM Analysis, your successes show you the way

Of course you know what’s going wrong. Do you measure what you’re doing right?

The 80/20 rule applied to Direct Marketing means that eighty percent of your revenues (and an even greater percentage of your profits on a cost model) are derived from twenty percent of your customers.

Who are these customers that are responsible for eighty percent of your revenues? And how can you find more just like them?”

The secret lies in the transaction log of your fulfillment system! You already have the path to growth; you just need a light to show the way. RFM Analysis provides the light.

RFM Analysis (Recency, Frequency, Monetary, and Product Category Data) of your transaction data can show you very clearly who’s buying what and when. It can also help you identify high-response customers in marketing promotions, and help you improve overall response rates by sending relevant offers that help stimulate demand for your products and services.

If you have a mailing project, and you’re looking for a seasoned Direct Marketing Consultant to help you with your RFM Analysis and achieve better results, then please contact me today.