Learn in the textbookMarketing Fundamentals and Understanding Customers
DefinitionRFM analysis (RFM分析) evaluates and groups customers by three metrics: Recency (date of the last purchase), Frequency (how often they buy), and Monetary (how much they spend).
ExplanationUsing accumulated purchase history, each customer is ranked on each metric, and the combination of ranks shows where that customer stands. A customer who used to buy often and spend a lot but has not bought anything lately, for example, is seen as drifting away and becomes a target for win-back measures.