Never assume a CHAID program or even a regression model will outperform an old-fashioned RFM analysis if the RFM has been refining the model for more than 20 years.
RFM helps you define the relationship you have with each subscriber as you can pinpoint where each one is in the customer lifecycle. As subscribers progress through the lifecycle, their needs change until they no longer need you. Using RFM metrics, you can extend the length of time subscribers are engaged with your brand and their overall lifecycle, as well as the value of each subscriber.
Direct marketers have been using recency, frequency, and monetary (RFM) analysis to predict ...