Go EZ on RFM
As the modeling-versus-RFM debate goes on, proponents of each donor-management approach continue to champion their preferred method. Weighing in recently on the Recency-Frequency-Monetary Analysis side was Arthur Middleton Hughes, vice president of KnowledgeBase Marketing.
In his session at the 2005 Annual Washington Nonprofit Conference earlier this month, Hughes was exuberant in his support, calling RFM “the most powerful segmentation method for predicting response,” adding that it’s “better than any segmentation model.”
But despite his accolades -- some of which might be considered fightin’ words in modeling country -- Hughes also warned that RFM isn’t something organizations should use all the time. Warning session attendees not to go “hog wild” with RFM, Hughes offered the following caveats:
1. If you use RFM al the time, half your donors and prospects will never hear from you.
2. They will be lost.
3. The others, who you do communicate with, will suffer from file fatigue.
4. Use RFM sparingly, when you “need a boost.” Or right before your development department is up for review, he quipped.
Hughes can be reached via e-mail at email@example.com.