Question content area

Part $1$

Analytics Mini$$ Case: Valuing Customers Using the RFM Method

RFM is a method frequently used by direct marketers to assess the value of customers. RFM stands for$($R$)$ecency$,($F$)$requency$,$ and$($M$)$onetary Value.

Imagine you are a direct marketer for an online company that specializes in selling unique candies from around the world that are difficult to acquire in the United States. You have a large customer$$ database, and you would like to apply the RFM method to value your current customers. You have two jobs.$$ First, $(1),$ you need to assign the correct RFM code values to a subset of your customer database.$$ Second, $(2),$ based on this RFM coding scheme you need to identify which customer subgroups should be targeted with a specific type of direct marketing message.

LOADING... Click the icon to view the common approach to calculate RFM$.$

LOADING... Click the icon to view the table summarizing overall customer statistics relating to RFM$.$

LOADING... Click the icon to view the customer subset information.

Part $2$

Which person represents the MOST appealing RFM segment of the $4$ listed$$ here?

Joey

with the RFM value of

$$

$143.($Round to the nearest whole$$ number.$)$

Part $3$

Which person represents the LEAST appealing RFM segment of the $4$ listed$$ here?

Hapner

with the RFM value of

$$

$332.($Round to the nearest whole$$ number.$)$

Part $4$

Which person represents the segment that we may target with advertising appeals in order to increase purchase$$ frequency?