RF segmentation is an effective marketing technique to retain customers. According to this approach, all visitors to your online store are divided into several segments based on indicators such as recency and frequency of orders. For each of the customer groups, it is recommended that you develop a separate strategy for interaction and involvement in the purchase process.
The basic RF segments
To perform an RF analysis manually, the marketer must first allocate customers to several groups according to their last purchase and then, within each group, perform segmentation by the number of orders. Convead does RF segmentation of the client base automatically, tracking the life cycle of each visitor in real time, updating their current status and distributing them into groups. By default, the system offers 7 such segments with preset settings:
New customers – visitors who made 1 purchase in the online store and no more than 40 days have passed since the date of purchase. The main task here is to “push” such visitors to repeat orders and transfer them to the “Promising” segment and then “Loyal”. This can be achieved, for example, by offering the client-related products, individual recommendations, and useful content (articles, reviews, training materials) in accordance with their interests.
Promising – this includes customers who have made a repeat order and no more than 51 days have passed since their last purchase. It is necessary to conduct active systematic work with this group – to carry out marketing campaigns, involve them in various activities and communication with the store, invite them to social networks and events, etc. It is necessary to maintain their interest in the store by offering new products, relevant products, and useful and interesting content (articles, videos, and news).
Loyal – this is the most valuable group of customers. It includes those who have made 3 or more orders and no more than 51 days have passed since their last purchase. The main goal of working with this segment is to keep customers in it for as long as possible. When communicating with loyal customers, it is especially important to show concern for them, collecting feedback and studying their needs.
At risk – loyal customers who have not made orders in 52–112 days move into this segment. This behavior may indicate that the customer is beginning to lose interest. In this case, you need to make every effort to bring the client back – for example, with the help of targeted promotions, special offers, discounts, and sales.
In the area of loss — in this segment are customers who were once loyal, but who have not placed an order for more than 113 days. To bring such customers back, it is recommended that you find out why they lost interest. You can remind them once again about the benefits of your products and store, as well as giving them a great offer of discounts, promotional codes, a selection of interesting new products, etc.
Drifting – these are the buyers who placed 1 or 2 orders in the period 40–75 days ago. To retain such customers, develop a plan to stimulate their interest – for example, you can send a mailing describing the benefits of the store and a selection of individual recommendations for products, or offer instalments or a promotional code. You might want to save the most generous discounts for this group of clients.
Sleeping – this is the least valuable segment of customers. It includes those who placed 1 or 2 orders, but the last purchase took place more than two and a half months (76 days) ago. However, these customers can still come back to you. How can their interest be revived? You can send them an email with a reminder about your store (“We miss you”), offer favorable discounts on recommended products, send them an interesting article or video review, etc.
Key objectives and conclusions
In working with RF segments your main task is to increase the group of loyal customers and keep them in this bracket. Analyzing the results of mailings and other campaigns, first of all it is necessary to strive to ensure that the group of loyal customers grows faster than the segments “At risk” and “In the loss zone”.
In addition to these RF segments, you can create other segments and use other indicators of prescription and frequency of orders based on the specifics of your online store and product niche. Convead allows you to flexibly segment your customers according to a variety of conditions.