Predictive Segments
Propensity and churn scores.
Beyond Demographics
Traditional segments group customers by age, gender, or location. Predictive segments group them by likely future behavior instead.
The question shifts from "who is this customer?" to "what will this customer do next?" That forward orientation makes predictive segments far more actionable for marketing.
The RFM Foundation
RFM scoring ranks customers on three axes: Recency of last purchase, Frequency of purchases, and Monetary value.
Each axis is usually scored 1 to 5 by quintile, giving a code like R5 F5 M5 for your best customers. RFM is the classic, interpretable backbone of behavioral segmentation.
RFM score example:
Recency: 5 (bought 3 days ago)
Frequency: 4 (8 orders)
Monetary: 5 (top 20% spend)
Segment code: R5 F4 M5 = ChampionAll lessons in this course
- What Is Customer LTV
- Calculating LTV
- Predictive Segments
- Acting on Predictions