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Catalogue company Boden is the king of mail order marketing - it combines regular mailings with ridiculously cheeky mailers ("You really must put me out of my misery and place an order soon ...") and has the results to prove it. Seventy-five per cent of 0-6 month buyers come back a year later and these regularly produce a ten per cent response to mailings (Marketing Direct, November 2003).

Boden is an example of a company that positively resists data overload, which other marketers can often succumb to. We all know that having more data doesn't guarantee better results and yet more complex and ingenious methods of data enhancement seem to be being developed. Age assumptions have been challenged, social and geographical enhancement adds factors such as lifestage, while values-based enhancement even attempts to redefine consumers as having rock-solid psychological outlooks as its way of explaining why similar-looking profiles have different purchasing patterns.

But some say data enhancement has become overly complicated. When fears of over-mailing have never been higher, many believe clients should return to an old marketing truism - mail your best customers more often.

"Having more data has made people think they need more ways of looking at it, but some have definitely lost sight of some of the best ways of doing so," argues Jon Epstein, director of data consultancy Results. He believes companies too readily use other, less factual enhancement when the real data is staring them right in the face.

"The reason someone buys something has little to do with social values or geography. People may fit an age bracket, but this is incidental. Marketers tend to use things such as social values when they think they can't get information about consumers anywhere else, but most of the information they need is there at their fingertips."

For Epstein, recent customers are the hottest and can be mailed more without any harm to the brand. In fact, leave them too long and the chance may be missed forever. "This is exactly why banks get it wrong," he says. "They ring-fence new customers and protect them from communications, when they should be mailing straightaway."

The recency-frequency-value (RFV) mantra is about separating the most recent, high-value customers from the rest of the database - seemingly good practice. But, as many commentators admit, this can force marketers into analysing their top 10 per cent of customers and ignoring people who could be, but aren't yet brand converts. These are the people that values-based work or other overlays would identify and which marketers must covet.

"There has certainly been a perception that traditional RFV has become tired," says Mark Patron, data consultant and former managing director of Claritas. "People are saying they know who their best customers are and that they're not going after their worst, but don't know what to do with the rest."

Identifying value

The RFV dilemma can be summed up in the holiday customer, who may only travel once a year but has all the trimmings - full-board, expensive flight seats and insurance - versus the three-times-a-year weekend-breaker, who spends less each time, but in total would spend the same amount of money each season. RFV wouldn't always show the them differently, but even if it did, it may still not clarify which one is worth continued marketing to.

"RFV, in terms of spend, would say the first, but it really ought to be the second," says Stuart Broughton, director of Datalytics. "The multiple-booker has less marginal value, but more interaction and maybe brand loyalty. RFV's use is as much about how an organisation defines 'value' as anything else."

For Carolyn Hardy, direct marketing manager at TUI (which owns Thomson Holidays and Portland), this is a daily consideration. For her, RFV dictates how the business is run, with segments cut 12 months ahead for mailings, and value is least important - at least for the moment. "Value isn't a major consideration for us at all. It tends to be recency first, and then after data is about three years old, frequency."

However, even for Hardy, where top RFV-based segments can be between 40 and 50 per cent up on the norm, how this balance will stay is a difficult question. "The holiday market is changing tremendously. People used to be predictable and go on their holidays once a year. We now see people going away more often for less time," she says.

RFV and beyond

Where RFV has maybe lost ground to other enhancements is in that it may well identify who's worth the most, but it doesn't offer solutions after that. "For one charity client, we found it was costing it money to communicate to 40 per cent of its donors," says Nigel Magson, managing director of Talking Numbers, which helps organisations identify who their best customers are. "What then happens is that clients say we must upgrade the next 20 per cent of people. Yet people are comfortable in their spend segments and trying to upgrade them can be just as pointless."

To tackle this, Talking Numbers has just launched RFV Optimiser, which aims to be more of a hybrid of pure RFV and lifestage/values/age/social data. "RFV is good at taking a long-term view of a customer, but doesn't spot changes in the shorter term, such as somebody suddenly spending less," explains Magson. "We run RFV at the point of change, and to help this, we add an extra piece of data - it could be lifestage or age - to see if that makes a difference to a person's score. It might be the case that a person has moved house and cuts back on non-essential spending. Better to know this and mail them to say, 'hey, don't worry, spend less with us until you're back to normal again', rather than lose them entirely. Then the marketer can divert spend to other, more prosperous customers."

But if RFV is about getting more from existing top customers, should marketers be using it to identify potentials they might be missing? Patron recently worked with catalogue company SilverMinds and found that the highest response came from highest historical spenders. However, analysis also found that had the worst 15 per cent of those mailed in one segment been dropped, and 20,000 of the next best added, a further £25,000 more sales could have been generated.

Different criteria

And marketing to people at the margins can pay. Studies show that retaining an additional five per cent of customers can boost profits by 25 per cent. Smart RFV should spot this and just how differently people treat it is shown by Allie Oldham, marketing director of Scotts of Stow. "For us, recency doesn't influence as much. In fact, we want to convince the people who buy our lists and want the most recent buyers that older data - 13 to 24 months - also works," she says.

For Oldham, propensity to buy is what she derives from her modelling, and she applies that to people who may not have bought for a while as much as anyone else. She has even gone as far back as records that are seven years old with excellent results.

"Our business pretty much follows the Pareto rule that the top 20 per cent contribute to 80 per cent of sales. But while RFV identifies this top 20, it's something we realise rather than chase. We'd rather look at average order values, so this could still mean we view people who make lots of small spends as valuable to us."

Scotts is fortunate. It has enough names to be able to decide to rest some. It also has a number of different sub-brands; each time an existing customer takes a new catalogue, they're treated as if they were a brand-new customer to capitalise on the 'hotness' of what Scotts defines a new customer. If people do drop spend, they're moved into a sub-category of 'recent low spenders'.

And while data can be cut, sliced, mashed and pulped in seemingly many ways, human intervention and gut instinct still has room to play. "With all the emphasis on figures, simple things such as 'seasonality' - a new year, a new range - can be just an important a trigger," adds Oldham. "This can well be the best time to reactivate customers. People still feel that we value them if we send them a catalogue after a while and it does translate to sales."

RFV is clearly in a period of change, as consumers change their habits and appear less predictable. But the message is clear that while the older principles may be challenged, RFV is certainly not dead and buried.

RFV VERSUS CRM

"Recently, EWA started working with P&O Ferries, following the merger with Stena for the cross-channel route and the merger of three P&O ferry organisations - Dover, North Sea and Portsmouth," explains Hilary Rogers, director of data company EWA (part of WPP Group). "Booking data from the past three years was reloaded and brought together to see what the single customer view was. This was vital for P&O to change its focus from the cross-channel route, where 70 per cent of customers were day-trippers, to a 36-hour crossing to Bilboa, Spain - a journey that people took as a mini-break or cruise.

"There was a great expectation at P&O that a reasonable number of people had experienced at least two different routes, but our analysis showed a route loyalty that meant communications would initially have to focus more on the benefits of each route, rather than assuming the customer already knew.

"We undertook detailed recency-frequency-value (RFV) analysis because there was a belief about recency and frequency created by port staff, who felt they saw many repeat customers who travel each month. What it didn't reflect though was the other 750,000 people who only travel every two years or more.

"Whether RFV is more important than CRM probably isn't the issue. It's about recognising both play an important part in the way we communicate to customers. RFV can challenge or support customer profiles, and as part of a CRM strategy can provide evidence of the difference a customer-focused strategy can have."