Open AccessLoyalty Improvement of Indonesian Local Brand Fashion Customer Based on Customer Lifetime Value (CLV) Segmentation
Author(s) -
M. Dachyar,
F M Esperanca,
Rahmat Nurcahyo
Publication year - 2019
Publication title -
iop conference series. materials science and engineering
Language(s) - English
Resource type - Journals
eISSN - 1757-899X
pISSN - 1757-8981
DOI - 10.1088/1757-899x/598/1/012116
Subject(s) - business , customer advocacy , customer retention , customer to customer , customer intelligence , marketing , loyalty business model , customer equity , service quality , database transaction , customer lifetime value , market segmentation , advertising , computer science , service (business) , database
There has been a significant growth of internet users over the past decade in Indonesia. The growth of internet users is followed by the growth of digital buyers. Most digital buyers in Indonesia make some transactions to purchase clothing which explains the phenomenon of e-commerce fashion growth. This study aims to identify the loyalty level of an electronic customer based on Customer Lifetime Value (CLV) of the customer segmentation and design the CLV improvement. Customer segmentation performed using the K-means algorithm and RFM analysis. This paper used 3 transaction datasets from 3 different local brand fashion e-commerce in Indonesia. This study found five customer segmentations according to CLV ratings as the best, valuable, potentially valuable, average, and potentially invaluable customer. Maintaining customer convenience while doing the transaction and improving service quality and customer trust are the keys to retaining potentially valuable, average, and potentially invaluable customers