Is it valid to use RFM (Recency, Frequency and Monetary) model for customer segmentation in the context of SMEs?

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Daqing Chen

Sure, there are many relevant papers on the subject. Data pre-processing is crucial, and interpretation of the segmentation is the core.

Happy to discussion if your data set is shareable.

Please also see the attached for our work for your reference. Thanks.

Tharika Weerakoon

Daqing Chen thank you very much, unfortunately I don't have the luxury of sharing the dataset. But my dataset is quite similar to Black Friday dataset that can be found visiting this link: https://www.kaggle.com/mehdidag/black-friday/kernels

Tharika Weerakoon The data set you mentioned doesn't contain time information. As such, RFM wouldn't be applicable. Could consider association rule analysis.