Using Recency and Frequency to measure customer loyalty

In Repeat Customer Insights there are a few insights you can pickup by comparing the Recency-Frequency (RF) Grids.

The segments to the top right are the best for repeat customers, the ones to the bottom left are the worst.

If segments to the right are increasing (higher Frequency), that's a sign that new customers are coming back and becoming more loyal.

If segments in the top three rows are increasing (higher Recency), that shows customers being responsive and reordering.

If segments to the bottom (lower Recency) are increasing, that's a sign that customers aren't buying again and might be defecting. If it's the bottom left, those are customers who haven't purchased that much. If it's the bottom right, those are loyal customers defecting.

Comparing two grids will show you how the customer flows shifted. Especially comparing grids 3, 6, or 12 months apart or at the start/end of a busy period (e.g. winter shopping).

Eric Davis

Retain the best customers and leave the worst for your competitors to steal

If you're having problems with customers not coming back or defecting to competitors, Repeat Customer Insights might help uncover why that's happening.
Using its analyses you can figure out how to better target the good customers and let the bad ones go elsewhere.

Learn more

Topics: Customer loyalty Rfm

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