# Matching Consignees/Shippers Recommendation System in Courier Service Using Data Analytics
## 2 Literature Review
### Shippers/Consignees Behavior Segmentation  
Customer segmentation is the process of dividing customers into similar groups according to certain characteristics. Customer information is examined in order to determine and retain profitable and loyal customers and then to develop an effective marketing strategy for each cluster of customers [25]. In the courier business, there are two types of customers: shippers and consignees. Shippers are direct customers who send their products via a courier. Consignees are indirect customers or customers of those shippers. Many factors need to be considered to correctly segment their behavior [26]. The Recency, Frequency, and Monetary Concept (RFM) was introduced by [PERSON] and [PERSON] [27] and is used to analyze aspects of customer behavior, such as the length of time since last purchase (recency), the number of purchases within a certain time period (frequency), and the amount of money spent over a certain time period (monetary). The integration of RFM and DA techniques hasbeen proposed for different applications, such as identifying customers and analyzing profitability. [PERSON] and [PERSON] [28] applied RFM to measure customer profitability and need for banking services. [PERSON] et al. [29] proposed a customer lifetime value for customers of a health and beauty company, using an RFM marketing analysis method for segmentation and adding a parameter (count item). Other research combined DA with RFM, including a self-organizing map [30; 31], neural networks and decision trees [32], rough set theory [33], chi-square automatic interaction detection [34], genetic algorithm [35], and sequential pattern mining [36; 37]. Several studies have considered different versions of RFM analysis. For example, the Length, Recency, Frequency, and Monetary (LRFM) model was proposed by [PERSON] et al. [38]. In addition to standard variables, this considers the length of the relationship between an organization and customers, with L defined as the number of time periods (e.g., days) from first to last purchase. Alternatively, [PERSON] et al. [39] proposed a weighted form of RFM, WRF, that calculates the weight of RFM through the multiplication of wR, wF, and wM, according to their relative importance, to make intuitive judgments about ranking and ordering. [PERSON] et al. [40] developed an Length, Recency, Frequency, Monetary, and Profit (LRFMP) model for a logistics company to predict customer churn. Other versions include Timely RFM (TRFM), which considers the relationship between product properties and purchase periodicity [41]; Recency, Frequency, Duration and Lifetime (RFDL), which measures the duration of website visits [42]; Frequency, Regency, Amount, and Type of merchandise or service (FRAT), which aims to provide a personalized u-commerce recommendation service [43]; Group-RFM (GRFM), which adds product category groups [44]; Recency, Monetary and Loyalty (RML), which adapts RFM into annual transaction environments; Recency, Frequency, Reach (RFR), proposed for application to social media, where variable examples are the last post for recency, the total number of posts for frequency, and the network of friends for reach [22]. In this study, we applied RFM to the number of customers (NC), the number of product items (NP) [42], weight (W), and day (D) to describe the behavioral patterns of shippers and consignees in the courier business. R is the time between the date of previous services and the reference date. Low recency customers tend to repurchase more than high recency customers [22]. F is the total number of services used within a specific period. M is the total spent in THB over a specific time. NP represents business diversity and reflects the previous history of shippers or customers. For example, a shipper who repeatedly sends the same product to individual customers or many customers may also operate as a manufacturer or a distributor of one specific product. On the other hand, if a shipper sends various types of products, the shipper may be a larger enterprise.