Digital Customer Relationship Management (e-CRM) in the Fashion Industry

Customer relationship management (CRM) aims to acquire customers and to establish profitable and lasting relationships with them. The use of a digital platform to implement CRM (e-CRM) allows the operational manifestations of the relationship between customer and company to be reported. Such digital platforms record data from every single customer and every single transaction and allow firms to obtain potentially vast amounts of data, which can be used to segment customers based on their digital purchase behaviour. Indeed, for companies it is essential to understand who their customers are and to know which customers contribute most to their revenue. One of the most widely used models to segment the customer base is RFM segmentation. This analysis defines homogeneous clusters of customers based on three variables: recency (R), that is, the time since the last purchase; frequency (F), that is, the number of purchases made by a customer in each period; and monetary (M), which is the average expenditure of the customer on the company website over a given period. The goal is to attribute to each customer a value or score that can place that customer in a specific segment (loyal customers, top customers, low-frequency customers, etc.) allowing the firm to plan different marketing and communication strategies based on the segments that emerge. The aim of this chapter is to analyse e-CRM strategies and actions in the context of the fashion industry based on RFM segmentation. We adopt the case study method to validate this framework. The case study concerns EM, a traditional Italian firm that operates in a specific niche of the fashion market, premium clothing for women.