RFM analysis is predicting customer behavior based on past actions. The analysis is based on three parameters:
*recency*- how long ago the customer made the last purchase; frequency**- frequency of customer purchases; *monetary- amount for customer orders.
This segmentation gives an idea of which customers will place an order and which will not even react to the offer. It is assumed that a customer who has shown himself not so long ago, shows increased activity or spends more money on products and is the most interested customer in an advertising campaign.
How is information displayed in the RFM analysis widget?
The widget displays the results of segmentation of the customer base by three parameters:
- M-F (amount on orders - frequency).
- R-M (time since the last purchase - amount for orders).
- R-F (time since the last purchase - frequency).
When you select "R-M" and "R-F" parameters, the vertical axis refers to the time since the last purchase and the horizontal axis refers to the importance in turnover or the frequency. Indicators differ in three indicators: low, medium, high.
When choosing the "M-F" parameter, the vertical axis is responsible for the importance in turnover, and the horizontal axis is for the frequency of purchases.
The intersection of indicator states displays the number of customers matching these states.
When you click on the number of customers, the customer base page is loaded, where a list of customers that fall into the selected segment is displayed. If the system user does not have access to the "Customers" section, then the "RFM" widget, accordingly, will not have links.
In the widget, thresholds for entering the RFM segment are configured. To do this, click on the gear
in the top right corner of the widget and configure the indicators as you wish.