1,864 research outputs found
Generalized Second Price Auction with Probabilistic Broad Match
Generalized Second Price (GSP) auctions are widely used by search engines
today to sell their ad slots. Most search engines have supported broad match
between queries and bid keywords when executing GSP auctions, however, it has
been revealed that GSP auction with the standard broad-match mechanism they are
currently using (denoted as SBM-GSP) has several theoretical drawbacks (e.g.,
its theoretical properties are known only for the single-slot case and
full-information setting, and even in this simple setting, the corresponding
worst-case social welfare can be rather bad). To address this issue, we propose
a novel broad-match mechanism, which we call the Probabilistic Broad-Match
(PBM) mechanism. Different from SBM that puts together the ads bidding on all
the keywords matched to a given query for the GSP auction, the GSP with PBM
(denoted as PBM-GSP) randomly samples a keyword according to a predefined
probability distribution and only runs the GSP auction for the ads bidding on
this sampled keyword. We perform a comprehensive study on the theoretical
properties of the PBM-GSP. Specifically, we study its social welfare in the
worst equilibrium, in both full-information and Bayesian settings. The results
show that PBM-GSP can generate larger welfare than SBM-GSP under mild
conditions. Furthermore, we also study the revenue guarantee for PBM-GSP in
Bayesian setting. To the best of our knowledge, this is the first work on
broad-match mechanisms for GSP that goes beyond the single-slot case and the
full-information setting
Scalable Semantic Matching of Queries to Ads in Sponsored Search Advertising
Sponsored search represents a major source of revenue for web search engines.
This popular advertising model brings a unique possibility for advertisers to
target users' immediate intent communicated through a search query, usually by
displaying their ads alongside organic search results for queries deemed
relevant to their products or services. However, due to a large number of
unique queries it is challenging for advertisers to identify all such relevant
queries. For this reason search engines often provide a service of advanced
matching, which automatically finds additional relevant queries for advertisers
to bid on. We present a novel advanced matching approach based on the idea of
semantic embeddings of queries and ads. The embeddings were learned using a
large data set of user search sessions, consisting of search queries, clicked
ads and search links, while utilizing contextual information such as dwell time
and skipped ads. To address the large-scale nature of our problem, both in
terms of data and vocabulary size, we propose a novel distributed algorithm for
training of the embeddings. Finally, we present an approach for overcoming a
cold-start problem associated with new ads and queries. We report results of
editorial evaluation and online tests on actual search traffic. The results
show that our approach significantly outperforms baselines in terms of
relevance, coverage, and incremental revenue. Lastly, we open-source learned
query embeddings to be used by researchers in computational advertising and
related fields.Comment: 10 pages, 4 figures, 39th International ACM SIGIR Conference on
Research and Development in Information Retrieval, SIGIR 2016, Pisa, Ital
Search Design and Broad Matching
We study decentralized mechanisms for allocating firms into search pools. The pools are created in response to noisy preference signals provided by consumers, who then browse the pools via costly random sequential search. Surplus-maximizing search pools are implementable in symmetric Nash equilibrium. Full extraction of the maximal surplus is implementable if and only if the distribution of consumer types satisfies a set of simple inequalities, which involve the relative fractions of consumers who like different products and the Bhattacharyya coefficient of similarity between their conditional signal distributions. The optimal mechanism can be simulated by a keyword auction with broad matching. (JEL C78, D44, D82
Are Estimates of Asymmetric First-Price Auction Models Credible? Semi & Nonparametric Scrutinizations
Structural first-price auction estimation methods, built upon Bayesian Nash Equilibrium (BNE), have provided prolific empirical findings. However, due to the latent nature of underlying valuations, the assumption of BNE is not feasibly testable with field data, a fact that evokes harsh criticism on the literature. To respond to skepticism regarding credibility, we provide a focused answer by scrutinizing estimates derived from experimental asymmetric auction data in which researchers observe valuations. We test the statistical equivalence between the estimated and true value distributions. The Kolmogorov-Smirnov test fails to reject the distributional equivalence, strongly supporting the credibility of structural asymmetric auction estimates
Display Advertising with Real-Time Bidding (RTB) and Behavioural Targeting
The most significant progress in recent years in online display advertising is what is known as the Real-Time Bidding (RTB) mechanism to buy and sell ads. RTB essentially facilitates buying an individual ad impression in real time while it is still being generated from a user’s visit. RTB not only scales up the buying process by aggregating a large amount of available inventories across publishers but, most importantly, enables direct targeting of individual users. As such, RTB has fundamentally changed the landscape of digital marketing. Scientifically, the demand for automation, integration and optimisation in RTB also brings new research opportunities in information retrieval, data mining, machine learning and other related fields. In this monograph, an overview is given of the fundamental infrastructure, algorithms, and technical solutions of this new frontier of computational advertising. The covered topics include user response prediction, bid landscape forecasting, bidding algorithms, revenue optimisation, statistical arbitrage, dynamic pricing, and ad fraud detection
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