The Use of LRFM Model for Customers Segmentation Based their Life Value

Abstract

Major challenge in the field of customer relationship management is on customer understanding and customer-centric organizations realize optimal allocation of resources between them and rank them according to their value to the company. This paper provides a suitable model for customer segmentation, based on the customer life time The process proposed in study corporate based on the data mining method in the Crisp Six phases of design and after determining the indexes of LRFM model (Length,Recency,Frequency, Monetary) at 921 customers and weighting them AHP group according to Discriminant Analysis in 16 departments and five cluster core categories and has been determined the customer life time. The results of the present study was to analyze the characteristics of providing corporate customers. Also, customer segmentation, key customers, and the value was determined. Finally some recommendations is presented to improve the company's customer relationship management system

Keywords

• customer relationship management
• customer segmentation
• crisp data mining
• lrfm model
• customer life value
• discriminant analysis