Will the frog change into a prince? Predicting future customer profitability

More and more companies have customer databases that enable them to analyze customer profitability over time. These companies often seek to determine the most important customers as indicated by their current or historical profitability and focus attention on them. Focusing on profitable customers can result in more efficient use of marketing resources, but this approach neglects the fact that customers can evolve over time. Some customers begin as low-profit customers but eventually develop into high-profit customers. Others may start out as high-profit customers but become unprofitable over time. Previous efforts to predict future profitability have been relatively unsuccessful, with relatively simple, naïve models often performing just as well as or better than more sophisticated ones. Our paper presents a new approach to predicting customer profitability in future periods that performs significantly better than naïve models. We estimate the models on data from a high-tech company in a business-to-business context and validate the models' predictive ability on a holdout sample.We show that a model based on simulation of customer futures provides large improvements over naïve extrapolation of average profits. By using the simulation model to select customers, ROI from marketing efforts is projected to increase by 58%.     

Will the Health Care Cost Curve be Bent? Where We Stand at the Start of 2011

This overview shows the change in health care costs in the aggregate, as a share of GDP, and—along with other programs—the share of entitlements in the federal budget. These trends are unsustainable. Many current proposals for reform imply a one-time downward shift in the curve but do not affect its long-run shape. Thus, they simply postpone consequences for a few years rather than solve the main problem. What must be done is to bend the health care cost curve so that its rate of growth is more in line with that of GDP.     

Will The Reminbi Be Devalued?

Since early 2001, many Asian countries have devalued their currencies. AsChina's net exports keep on decliningthis year, how much longer the RMB cansustain its stability has again been drawing people's attention both at home andabroad. In this ever-heated argument,the majority of people believe that theRMB will not be devalued in the nearfuture.The Situation is Not PromisingIn 2001, China's net export continues to decline as they have in the lastfew years. According to statistics, thegro…     

Can AI benefit individual resilience? The mediation roles of AI routinization and infusion

The recent COVID-19 pandemic has raised concerns about individual resilience in the face of adversity. The abundant research suggested that artificial intelligence (AI) can help organizations handle changes during this challenging period. However, little empirical research has explored whether the presence of AI enhances individual resilience against adversities. Drawing on the reciprocal determinism theory, this study considers the formation of two typical post-adoption behaviors and their subsequent results in individual resilience. The structural equation modeling shows that AI factors (usability and sociability) and personal factors (self-efficacy) determine usage behaviors (routine and infusion use), in turn affecting individual resilience. The OLS results suggest the right half of the U-shaped relationships between infusion use and resilience. Two-step fsQCA offers three configurations resulting in high resilience under the different presence of AI factors and also suggests the roles of user behaviors. The study provides new theoretical enlightenment for the impact of digital service technology on individuals and enriches the existing literature on the usage of digital service technology. The findings provide practical implications for practitioners to design AI products better to improve smart service experience.     

Will the People's Republic of China trigger off the next Asian crisis?

During the first phase of the Asian crisis, there were no signs of it having any serious influence on the People's Republic of China, but the country does now appear to have been drawn into the crisis. In which areas of the Chinese economy are there serious problems likely to occur? What measures ought to be taken to counteract them?     

Are we living at the expense of the developing countries?

The industrial nations are often accused of achieving their relative affluence by using natural resources at the expense of the developing countries. Is this accusation justified? Would it really be in the developing countries' interests if the industrial nations drastically reduced their consumption of natural resources, as is so often demanded?     

Will Households Change Their Saving Behaviour After the “Great Recession”? The Role of Human Capital

The ??Great Recession?? of 2007?C2009 (Rampell 2009) had a devastating impact on personal finances, causing households to retrench by limiting spending and reducing indebtedness. One positive outcome??evaluated by some??has been a rise in the widely cited ??personal saving rate?? from historic lows set in the middle of the decade. This paper evaluates the reasons for the rebound in the saving rate by undertaking a new examination of the determinants of household saving. Extending previous work and making use of data inclusive of the turbulent 2000s decade, the analysis finds support for an inverse relationship between the personal saving rate and the return to home equity. New in the research is a similar finding of an inverse relationship between the personal saving rate and the return to household investment in human capital. The results are used to make alternative forecasts of the personal saving rate through 2020. The path of the household human capital return is found to be a key determinant of these forecasts.     

Will the DSM Strategy Spur Innovation?

In summary, the DSM strategy appears laudable and overall very comprehensive. However, its impact will depend on whether the Commission manages to create a more suitable environment for innovation and entrepreneurship by upgrading skills, promoting more adaptive rulemaking, empowering end user choice, and avoiding rules that are hostile to innovation, such as excessive restrictions to text and data mining and the extension of obsolete rules to OTTs.     

Resistance Will Be Futile? The Stigmatization (or Not) of Whistleblowers

Journal of Business Ethics - Does speaking up ruin one’s life? Organizational and whistleblowing research largely accept that “whistleblower” is a negative label that effects...     

“All Business is Glocal”: The future of the automotive industry

Daimler AG is a globally leading producer of premium passenger cars and heavy- and medium-duty trucks. Dr. Dieter Zetsche, Chairman of Daimler AG and Head of Mercedes-Benz Cars, was interviewed by Dr. Christian Schmitz, Head of Business-to-Business Marketing at the University of St. Gallen.     

The role of social value creation in business model formulation at the bottom of the pyramid – Implications for MNEs?

This paper presents an exploratory study of how social value creation and business models may be interrelated in the context of the bottom of the pyramid (BOP) business formation. We develop our analysis around five case studies of actual businesses set up in rural India by people in the BOP. We attempt to draw implications from the performance of the business models in the BOP for what MNE strategies of engagement with the BOP may learn from the processes we analysed.     

Brave New World? On AI and the Management of Customer Relationships

In light of the emerging discourse on AI systems' effect on society, whose perception swings widely between utopian and dystopian, we conduct herein a critical analysis of how artificial intelligence (AI) affects the essential nature of customer relationship management (CRM). To do so, we survey the AI capabilities that will transform CRM into AI-CRM and examine how the transformation will influence customer acquisition, development, and retention. We highlight in particular how AI-CRM's improving ability to predict customer lifetime value will generate an inexorable rise in implementing adapted treatment of customers, leading to greater customer prioritization and service discrimination in markets. We further consider the consequences for firms and the challenges to regulators.