Computing attributes from your customers’ purchase history is extremely valuable in making marketing decisions.  Traditionally, RFM (recency, frequency, monetary) measures are the first customer attributes computed and utilized.  In addition to RFM, many companies also include Product (P) and Channel (C) and other types of purchase history attributes. 

However, there are large groups of customers where this RFMPC data is simply not sufficient to use in describing, segmenting or modeling your customers.  You have one-time buyers, non-buyers (who may be gift recipients or catalog requestors or email registrants, etc.), and lapsed buyers where the RFMPC data is very limited.  For all of these customer groups, you will want to go beyond RFMPC to sources such as:

• Web visit data – # of visits, # of pages by category, visit recency
• Email send/open/click data, – # of opens, # of clicks by time period
• Social media – hits on Facebook, Twitter
• Co-op data – # and amount of purchasing elsewhere, by channel and product category
• Demographic data – age, income, children, etc.

The web visit data, email data and social media data provide a richer view into the multi-channel behavior of your customers.  In general, the more ways the customer interacts with you, the more valuable and loyal the customer.

The co-op data provides rich RFMPC data across other “like” companies, especially when you have limited internal RFMPC data.  By overlaying this data onto your customer segments with limited purchase history, you can expect significant benefits in rank ordering customers for marketing purposes.

Finally, the demographic data may or may not provide additional benefit, depending on the degree of demographic targeting in your marketing campaigns.

In many cases, data from these sources can be gathered together in a “test” mode, for a sample of customers, so that you can evaluate the potential benefit before taking on the cost of incorporating the data source into your database.   We at Clario Analytics can help you with these tests. 

About Deb Campbell
Deb is a senior marketing analytics leader and is Clario’s Vice President of Modeling Solutions and a co-founder. She has spent the majority of her career developing and implementing analytical solutions, transforming data into intelligent marketing strategies. Before co-founding Clario, Deb worked at Fingerhut where she parlayed her advanced knowledge of database marketing, predictive modeling and optimization techniques and achieve significant revenue milestones from these efforts.