Recency, Frequency, Value (RFV) analysis is a form of classification which shows you how recently your customers transacted with you, how frequently they transact and what their  total value is in a given time period.

This type of analysis is a form of customer classification and segmentation that only using transactional data. This is important and very useful because consumers often day they will do something when asked, but they don’t actually do it when they have to spend money. RFV look at structures in the way your customer actually spend. Whereas many segmentation approaches use either attitude survey or audience data, RFV analysis looks only at how consumers actually behave. More savvy marketers will know there can be a very big difference between what consumers say they will do what they actually do.

If you want to grow revenue, understanding transactional data is a great place to start gathering actionable insight that can provide real direction.

What exactly is RFV analysis?

Imagine a 3D cube – a Rubik’s cube is ideal. Then think of three axes – one for recency of last purchase, one for frequency of purchases and one for total value.¬† By normalising each customer’s metrics into a value of between 1 and 5 or 1 and 10, we can plot all customers into a location in the 3D cube.

Benefits of RFV

With each customer classified we can explore scenarios of how to increase revenue by moving customers from one part of the Rubik’s cube to another.

We offer recently frequency value modelling at a fixed price and with a fixed set outputs. Reports are reproducible and can be run as and when required, be that daily, weekly, monthly, or quarterly.

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