Another aspect is that RFM analysis only uses historical data about customers and hence may not predict future customer activity given its limitations. Predictive methods may be able to identify future customer behavior that RFM analysis cannot, hence advanced Data analytics methods need to be introduced as the next step. It is highly recommended that organizations should have a maturity-based growth path for shifting to more detailed analytics gradually over a period of time.
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What is RFM (Recency, Frequency, Monetary) Analysis?
Source: Trends Pinoy
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