RFM vs. Product Segmentation?

RFM as it is understood by direct marketers is not applicable to email marketing.  However, RFM is applicable for Email.

RFM is so effective in direct mail because it identifies the breakeven point of sending mail pieces. It tells you who not to send to.  Arthur Middleton Hughes, a pioneer in the direct marketing industry, has a blog post on the topic over at Silverpop.

Of course, he’s right. You shouldn’t apply RFM the same way you’d apply it for direct mail. What we have learned at Top Right is that RFM is applicable in triggered emails. R – recency – has long been understood as the most powerful indicator of a subsequent purchase – driving up lifetime value. We apply that learning from the direct marketing industry to drive our clients to use triggers to their most recent customers. Those work really, really well.

Let the Big Guys Make the Mistakes

Did you hear that top retailers such as JC Penney and the Gap are shutting down their Facebook stores?  As one social media developer said, “I give so-called F-commerce an ‘F.’”

What does that mean for our clients and those like them? Well, it means that when it comes to emerging technologies such as Facebook, sometimes it makes sense to watch closely what the big guys try.  If it works, copy and improve. Our clients typically can do it better because they are smaller and more nimble.  If it fails, they learn and don’t repeat

Bloomberg covers the story here – http://www.bloomberg.com/news/2012-02-17/f-commerce-trips-as-gap-to-penney-shut-facebook-stores-retail.html

Investors Business Daily here – http://news.investors.com/article/600351/201202071711/social-media-disappoints-as-ecommerce-driver.htm