Recipe | RFM Segments | Shopify

Recipe Overview

• Manage RFM segments based on Recency (days since last purchase) and Frequency (number of purchases).
• Use the insight "Average Repurchase Interval" to set thresholds for at-risk customers that suit your store.

For more information on RFM analysis, please refer to the article below.

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How to Use

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Setting Thresholds

Check the insight "Distribution of Average Purchase Frequency (F)" to determine thresholds for repeat customers and loyal customers.

• Defining loyal customers depends on the store's strategy. One method is setting a fixed number like "5 purchases or more," or using the "top 10% of purchase frequency" as a threshold.

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Check the insight "Distribution of Average Repurchase Interval" to determine thresholds for active customers, at-risk customers, and churned customers.

• Defining at-risk and churned customers depends on the store's strategy. One method is:
  • "Active customers" include those repurchasing within the period where 50% of all customers repurchase.
  • "At-risk customers" include those repurchasing within the period where 75-90% of all customers repurchase.

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Although "Distribution of Average Days Since Last Purchase (R)" is a similar insight, it is not suitable for setting thresholds. It is more appropriate to evaluate based on how many days within which most people repurchase rather than deviations from the overall average. While determining thresholds from this distribution is commonly introduced, ECPower recommends the method above.

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Segment Settings

In this example, repeat customers are defined as those with an average purchase frequency of 2-4 times, and at-risk customers are those with 31-90 days since their last purchase.

Adjust according to your store's situation.

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👻 Loyal × Churned Customers

• Segment Name: 👻 Loyal × Churned Customers
• Description: Loyal customers with a high number of purchases who have not purchased recently.
• Conditions: Frequency (Total order count) is within range of 5 times or more AND Customers whose Recency (Last purchase date) is within range of 91 days ago or before

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Create this segment in ECPower

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👻 Repeat × Churned Customers

• Segment Name: 👻 Repeat × Churned Customers
• Description: Repeat customers with multiple purchases who have not purchased recently.
• Conditions: Frequency (Total order count) is within range of 2 - 4 times AND Customers whose Recency (Last purchase date) is within range of 91 days ago or before

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Create this segment in ECPower

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👻 First-time × Churned Customers

• Segment Name: 👻 First-time × Churned Customers
• Description: First-time customers who made only one purchase and have not purchased recently.
• Conditions: Frequency (Total order count) is once AND Customers whose Recency (Last purchase date) is within range of 91 days ago or before

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Create this segment in ECPower

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👀 Loyal × At-Risk Customers

• Segment Name: 👀 Loyal × At-Risk Customers
• Description: Loyal customers with a high number of purchases who are at risk of not purchasing again soon.
• Conditions: Frequency (Total order count) is within range of 5 times or more AND Customers whose Recency (Last purchase date) is within range of 90 days ago ~ 31 days ago

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Create this segment in ECPower

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👀 Repeat × At-Risk Customers

• Segment Name: 👀 Repeat × At-Risk Customers
• Description: Repeat customers with multiple purchases who are at risk of not purchasing again soon.
• Conditions: Frequency (Total order count) is within range of within range of 2 - 4 times AND Customers whose Recency (Last purchase date) is within range of 90 days ago ~ 31 days ago

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Create this segment in ECPower

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👀 First-time × At-Risk Customers

• Segment Name: 👀 First-time × At-Risk Customers
• Description: First-time customers who made only one purchase and are at risk of not purchasing again soon.‍
• Conditions: Frequency (Total order count) is once AND Customers whose Recency (Last purchase date) is within range of 90 days ago ~ 31 days ago

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Create this segment in ECPower

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🔥 Loyal × Active Customers

• Segment Name: 🔥 Loyal × Active Customers
• Description: Loyal customers with a high number of purchases who have made recent purchases.‍
• Conditions: Frequency (Total order count) is within range of 5 times or more AND Customers whose Recency (Last purchase date) is within range of 30 days ago or after

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Create this segment in ECPower

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🔥 Repeat × Active Customers

• Segment Name: 🔥 Repeat × Active Customers
• Description: Repeat customers with multiple purchases who have made recent purchases.‍
• Conditions: Frequency (Total order count) is within range of 2 - 4 times AND Customers whose Recency (Last purchase date) is within range of 30 days ago or after

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Create this segment in ECPower

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🔥 First-time × Active Customers

• Segment Name: 🔥 First-time × Active Customers
• Description: First-time customers who made only one purchase and have made a recent purchase.‍
• Conditions: Frequency (Total order count) is once AND Customers whose Recency (Last purchase date) is within range of 30 days ago or after

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Create this segment in ECPower