Application of Customer Segmentation for Electronic Toll Collection: A Case Study

Abstract

Applying big data technology, this study presents a customer segmentation method of Electronic Toll Collection (ETC) based on vehicle behavioral characteristics. A segmentation index system of ETC customers comprising Recency, Frequency, and Monetary is extracted and constructed using ETC data. The whole-sample clustering analysis of ETC customers is accomplished with the Clustering LARge Applications (CLARA) algorithm while overcoming the invalidation problem of big data clustering. A decision tree on ETC customer segmentation is constructed and transformed into a set of segmentation rules. Empirical results indicate that the proposed method is better able to analyze travel characteristics and to present values and appreciation potentials for ETC customer classification. This method provides an innovative idea for implementing precision marketing and establishing hierarchical discount rates for ETC customers. Furthermore, it provides theoretical support to increase the ETC customer scale and payment ratio, thus improving the decision-making level in expressway operation and management.