RFV is an acronym for Recency, Frequency and Value. When we design marketing campaigns, we have to customise these campaigns to specific target groups for best results rather than running a general campaign for all customers.
RFV tool when used judiciously helps us arrive at the following combinations:
- What is the Frequency(F) of customers whose recency in the system is R?
- What is the Frequency(F) of customers whose value billing is more than Rs V lakhs in last one year(for example)?
- What is the Recency(R) of customers whose billing is more than Rs V lakhs?
- What is the Frequency(F) of customers whose Recency(R) is greater than 3 months(for example)?
- What is the Value(V) of customers whose frequency is more than(or less than) F?
- Customers whose Recency(R) is less than 3 months (for example) have a value of Rs R in the billing system?
Sellers who do not maintain database of calls made will never be able to use the RFV tool in their internal analysis of sales. Now at least start believing that salespersons write daily report for themselves and not only for management.