Managing Your Customer Database

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Using a purchase recency/frequency framework to monitor the health of your customer file, gauge your customer acquisition and retention programs, and target email campaigns.

Business

A Recency & Frequency purchasing model Framework Managing your customer database

Recency & Frequency classifications are powerful because they can serve as surrogates for determining level of customer engagment

[object Object],[object Object],[object Object],[object Object],Your customer file Lets put it in perspective...

[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

[object Object],[object Object],[object Object],[object Object]

[object Object],Season 1 Season 2 Season 3 Jan Apr Jul

0 - 3 months 3 - 6 months 6 - 9 months 9+ months ,[object Object],Recency Groups: Season 1 Season 2 Season 3 Jan Apr Jul 3 months

0 - 3 months 3 - 6 months 6 - 9 months 9+ months ,[object Object],Season 5 Season 6 Season 7 Jan Apr Jul b/i = 1000

0 - 3 months 3 - 6 months 6 - 9 months 9+ months ,[object Object],Season 5 Season 6 Season 7 Jan Apr Jul 3 months $ #buyers = 230

0 - 3 months 3 - 6 months 6 - 9 months 9+ months buyer rate = #buyers / b/i Season 5 Season 6 Season 7 Jan Apr Jul $ #buyers = 230 = 230 / 1000 = 23% b/i = 1000 calculate the group's buyer rate $

Title Calculate buyer rates for each recency group

[object Object],[object Object],[object Object],Seasonal buyer rates

Consider what happens in Season 6 to a customer's recency classification... The Evolution of your R/F customer file

0 - 3 months ,[object Object],Season 5 Season 6 Season 7 Jan Apr Jul = "buyer"

The R/F purchasing model Framework is easy 0 - 3 months 3 - 6 months 6 - 9 months 9+ months ,[object Object],Season 5 Season 6 Season 7 Jan Apr Jul = "non-buyer"

0 - 3 months 3 - 6 months 6 - 9 months 9+ months ,[object Object],Season 5 Season 6 Season 7 Jan Apr Jul

Sub Title Lets take the example to Season 1 - your first season in business...

New Buyer Season 1 0 - 3 months 3 - 6 months 6 - 9 months 9+ months Recency Group Season 2 Season 3 Season 4 Season 5 Season 6 Season 7

New Buyer Season 1 0 - 3 months 3 - 6 months 6 - 9 months 9+ months Recency Group Season 2 Season 3 Season 4 $ Which outcome would you prefer? $ Future Value

New Buyer Season 1 0 - 3 months 3 - 6 months 6 - 9 months 9+ months Recency Group Season 2 Season 3 Season 4 Season 5 Season 6 Season 7 ? 0 0 1 1 1 1 0

Sub Title Over the years your customer database evolves. The more successful you are at keeping customers RECENT, or keeping them active, the more value you will extract from your acquired customers over time

New Buyers Season 1 0 - 3 months 3 - 6 months 6 - 9 months 9+ months Recency Group Season 2 Season 3 Season 5 Season 6 Season 7 Season 4

[object Object],[object Object],The RF customer file model...

[object Object],[object Object],[object Object],[object Object],[object Object],Extentions of the idea...

"If you're not segmenting your data in some business-savvy way, if you're still talking about averages, you're making gross errors in your analysis -me

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Managing Your Customer Database

1. A Recency & Frequency purchasing model Framework Managing your customer database

2. Recency & Frequency classifications are powerful because they can serve as surrogates for determining level of customer engagment

4. know your brand been to your site "universe" customers

5. know your brand been to your site "universe" customers customer acquisition

6. know your brand been to your site "universe" email subscribers customers retention

7. In Summary The R/F Model

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11. Sub Title Building the Framework

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17. 0 - 3 months 3 - 6 months 6 - 9 months 9+ months buyer rate = #buyers / b/i Season 5 Season 6 Season 7 Jan Apr Jul $ #buyers = 230 = 230 / 1000 = 23% b/i = 1000 calculate the group's buyer rate $

18. Title Calculate buyer rates for each recency group

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20. Consider what happens in Season 6 to a customer's recency classification... The Evolution of your R/F customer file

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24. Sub Title Lets take the example to Season 1 - your first season in business...

25. New Buyer Season 1 0 - 3 months 3 - 6 months 6 - 9 months 9+ months Recency Group Season 2 Season 3 Season 4 Season 5 Season 6 Season 7

26. New Buyer Season 1 0 - 3 months 3 - 6 months 6 - 9 months 9+ months Recency Group Season 2 Season 3 Season 4 Season 5 Season 6 Season 7 ?

27. New Buyer Season 1 0 - 3 months 3 - 6 months 6 - 9 months 9+ months Recency Group Season 2 Season 3 Season 4 $ Which outcome would you prefer? $ Future Value

28. New Buyer Season 1 0 - 3 months 3 - 6 months 6 - 9 months 9+ months Recency Group Season 2 Season 3 Season 4 Season 5 Season 6 Season 7 ? 0 0 1 1 1 1 0

29. Sub Title Over the years your customer database evolves. The more successful you are at keeping customers RECENT, or keeping them active, the more value you will extract from your acquired customers over time

30. New Buyers Season 1 0 - 3 months 3 - 6 months 6 - 9 months 9+ months Recency Group Season 2 Season 3 Season 5 Season 6 Season 7 Season 4

31. Sub Title In closing...

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35. "If you're not segmenting your data in some business-savvy way, if you're still talking about averages, you're making gross errors in your analysis -me

Managing Your Customer Database

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