The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

Don't blindly worship the formula that seems to be tall. You should verify it yourself before using it. Otherwise, it will be your own fault

A popular one some time ago operate In the map, I found an interesting formula

 The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

Look carefully, it's tall, but it can't stand scrutiny

one

Incorrect expression in mathematical formula

In the formula, t represents the time window

For example, t=1 represents the number of consumption in the first month, and t=2 represents the number of consumption in the second month

In the formula, s represents the consumption times

For example, s=1 represents one consumption, s=2 represents two consumption

First of all, one variable in mathematics can only be replaced by one letter, so is the consumption number t or s?

 The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

Secondly, ∑ means summation, as shown below:

 The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

Where n is the upper bound, i is the lower bound, and k is the formula

That is, k fetches data from i to n, and then adds all the results

Application example:

 The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

You can see this case There is t in the middle and lower bounds, and t also appears in the following formula

So this user loyalty Model Where is t in the formula?

Since there is only s in the formula, mathematically speaking, t here should be s

two Case correction

The mathematical formula should be universal. No matter how difficult it is, there will be restrictions

But this formula can easily find loopholes

Scenario 1:

Customer A has consumed 1 times since the first month, 2 times since the second month, and 3 times since the third month

According to the formula, customer loyalty of A is: 1/2+2/3+3/4=1.92

 

Scenario 2:

Customer B has consumed 3 times since the first month, 2 times since the second month, and 1 times since the third month

According to the formula, customer loyalty of B is: 3/4+2/3+1/2=1.92

 

So customer A has the same loyalty as customer B?

A Customer consumption gradually decreases

B Customer consumption increases gradually

CRM staff should all know that customer loyalty of B is on the rise and is now the highest

A Customer loyalty is gradually declining and is now the lowest

To sum up, there are two obvious errors in this formula, and the second error also leads to the failure of the whole formula

three My loyalty calculation method

But the sum formula ∑ also inspired me

I also worked out a calculation method of user loyalty

Don't dare to say the model, put it up and have a look

 The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

1. Weighting

In weighting, the values of different weights are given according to the latest Nth month

The most recent month is the closest to the present, so the assignment is the highest

The last December is the farthest from the present, so the assignment is the lowest

I use the calculation method of 1 year. Of course, if your customer's life cycle reaches 2 years, you can also assign values from 24, from the latest January to the latest 24th month

Then take 12+11+...+1=78 as the sum of the assigned values

In weighted assignment rate, 15.38%=12/78, 14.1%=11/78

 The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

2. Loyalty

The number of purchases made by customers in the previous N months multiplied by the weighted assignment rate of the corresponding month to get the loyalty of that month

Then add up the loyalty of all months in a year

Then we can get the total loyalty of the customer

 The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

 

3. Practical examples

Let's see two comparisons

Customer A has bought more recently, 14 times in total

Customer D has bought more in the past, 35 times in total

However, according to the weighted total, customer A loyalty is greater than customer B loyalty

Because customer D's loyalty is too low recently

 The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

The above is my simple loyalty assessment method

Loyalty=∑ purchase times in the Nth month * corresponding to weighted assignment in the latest Nth month

 The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

There are other better methods. Welcome to discuss and exchange The loyalty model of a customer whose real name is wrong: L=∑ S/(S+1)

 

Author: Yu Heng, the founder of an Internet We Media, has served many top 3 e-commerce businesses in the industry category, and is the head of crm for the tens of millions of user platforms member Knowledge system, accuracy Marketing Data analysis I have rich knowledge and practical experience. WeChat official account: returned CRM

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