How to create a CRM segment

A segment scheme sorts every one of your contacts into exactly one group, based on how recently they were active, how often, or how much they spent. Creating one takes a few steps, and this article also covers how to read it once it starts filling up.

Creating a segment

1. Go to CRM → Segments.
2. Click Add segment.
3. Fill in the segment:
   • Name: how you'll recognise it in the list. It has to be different from your other segments.
   • Method: what the contacts are grouped on.
     • RFM scores contacts on recency, frequency and monetary value together, into segments like Champions and At Risk.
     • Recency groups contacts by how recently they were last active.
     • Frequency groups contacts by how often they are active.
     • Monetary groups contacts by how much they have spent.
   • Source: where those numbers come from. Loyalty uses loyalty transactions, Orders uses orders. Pick the one you actually have data in. If your POS sends orders, Orders gives you spend per contact; if you only run loyalty, Loyalty is the one.
4. Click Submit.
5. On the segment's own page, click Activate. A new segment starts out inactive, and nothing is calculated until you activate it.

The first calculation starts straight away. While it runs, the segment shows Updating and the options menu is unavailable. Large contact bases take a while, and the page refreshes itself when it's done.

How contacts are scored

Scores are relative. Contacts are ranked against each other rather than against fixed thresholds, so the cut points come from your own contact base and shift as behaviour changes. The How it works tab on the segment spells this out in three steps, and shows the current cut points in your own numbers.

• Measure. For every contact with at least 1 loyalty transaction, or 1 order, we take the days since their last one, how many they have, and the total amount.
• Rank into 5 groups. Contacts are split into 5 equal groups of 20% per metric. The top group scores 5, the bottom group scores 1. For recency, fewer days since the last activity means a higher score.
• Combine or name. For RFM, the frequency and monetary scores are averaged into 1 score and combined with recency, which places every contact in 1 of 11 segments. For the single-metric methods, each score is simply its own tier, from best to worst.

Contacts with no activity for that source can't be scored yet. They sit in the catch-all group until they place an order or earn loyalty activity, and then move into a real segment.

Every contact belongs to exactly one segment per scheme, and you can run several schemes side by side. An RFM scheme on orders and a recency scheme on loyalty are two separate schemes, each with their own grouping.

Reading the segment

A segment has three tabs:

• Segment breakdown shows where your contacts sit: the RFM matrix for an RFM scheme, and a distribution chart for the single-metric ones. Click a segment to see the contacts in it.
• History shows how the distribution moved over time, how many contacts moved up, down, sideways or were newly added, and which segments they moved between. It needs a few calculations before there's anything to show.
• How it works explains the scoring for this specific method and source, and lists the current cut points, so you can see what a score of 4 on frequency actually means in orders or transactions.

How it stays up to date

An active segment is fully recalculated every night, between 01:00 and 05:00 in your account's timezone. In between, a contact is re-sorted on its own when their activity changes, so somebody who orders today doesn't wait until tomorrow to move.

Because the cut points are recalculated with the whole population, a contact can move segment without doing anything themselves: if everybody else starts ordering more often, an unchanged contact slides down.

Deactivating and deleting

Use Deactivate on the segment's page to stop the nightly recalculation and leave the segment where it is. Activate starts it up again with a fresh calculation.

Under Options you'll find Delete, which removes the segment and its history for good.