Following a resolution passed at the Interim Executive Committee meeting in October, EMAC will be a co-sponsor (along with The Marketing Science Institute and the Brand Science Institute) of the ISMS (Informs Society on Marketing Science) Practice Prize. The Practice Prize is awarded for an outstanding implementation of marketing science concepts and methods. The methodology used must be sound and appropriate to the problem and organization, and the work should have had significant, verifiable and, preferably quantitative impact on the performance of the client organization.
Most recently, the Third Prize competition crowned a winner at the 27th Marketing Science Conference on 17 June at The Goizueta Business School at Emory University in Atlanta, Georgia.
The winning entry was “Customer Equity and Lifetime Management (CELM)", by a joint team from IBM's Zurich Research Labs and Finnair, including Abdel Labbi, Giuliano Tirenni, Cesar Berrospi, Andre Elisseff and Kari Heinonen.
Their work reports on an innovative, long run approach to customer lifetime management implemented at Finnair. That work has lead to improved response rates to Finnair's marketing offers by 10%, decreased marketing costs of 20% and an overall improvement in customer satisfaction at Finnair of 10%. The CELM approach is a decision support system that offers marketing managers a sophisticated framework for optimal planning and budgeting of targeted marketing actions (e.g. campaigns) in order to maximize the return on marketing investments. The approach assesses the changing needs and preferences of customers and maximizes the value of a firm's portfolio of customers over a planning horizon in a manner similar to the way financials planners manage stock portfolios. CELM recommends which offers should be made to which customers at what time to help those customers become more loyal and of higher value in the most cost-effective manner possible.
The 2005 Practice Prize committee was comprised of Nils Andres, (representing the Brand Science Institute), Gary Lilien, Prize Committee Chair, Leigh McAlister (representing the Marketing Science Institute), Jagmohan Raju (as ISMS President), Arvind Rangaswamy, Jorge Silva-Risso, Steve Shugan (as Marketing Science editor), Joel Steckel, and Gerard Tellis.
The other finalists in the competition were
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"Quantifying and Improving Promotion Profitability at CVS" by Kusum Ailawadi, Dartmouth University, Jacques Cesar, Mercer Consulting, Bari Harlam, CVS and David Trounce, Mercer Consulting.
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"An Assortment-Wide Decision-Support System for Dynamic Pricing and Promotion Planning" by Martin Natter, Andreas Mild, Thomas Reutterer and Alfred Taudes, all from Vienna University of Economics and Business Administration, and
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"The Right Product for the Right Person: Product Recommendation from Infrequent Events" by Brendan Kitts, iPropsect, Marty Vrieze, Central Purchasing Inc and David Freed Exa Corporation.
The full presentations from this year as well as those from previous competitions are available now. These presentations were professionally videotaped and have been edited especially for classroom use. The DVDs also contain the related competition PowerPoint presentation.
To see a complete list of available DVDs or to view short (3-5 minute) summaries of each of this year's presentations see:
http://www.informs.org/Edu/MarketingScience
(To view the summaries, you will need to use Internet Explorer as a browser)
Gary L. Lilien, Vice President, EMAC VP External Relations and Chair 2005 ISMS Practice Prize Competition Committee