Real-Time Bidding (RTB) is revolutionising display advertising by facilitating per-impression auctions to buy ad impressions as they are being generated. Being able to use impression-level data, such as user cookies, encourages user behaviour targeting, and hence has significantly improved the effectiveness of ad campaigns. However, a fundamental drawback of RTB is its instability because the bid decision is made per impression and there are enormous fluctuations in campaigns' key performance indicators (KPIs). As such, advertisers face great difficulty in controlling their campaign performance against the associated costs. In this paper, we propose a feedback control mechanism for RTB which helps advertisers dynamically adjust the bids to effectively control the KPIs, e.g., the auction winning ratio and the effective cost per click. We further formulate an optimisation framework to show that the proposed feedback control mechanism also has the ability of optimising campaign performance. By settling the effective cost per click at an optimal reference value, the number of campaign's ad clicks can be maximised with the budget constraint. Our empirical study based on real-world data verifies the effectiveness and robustness of our RTB control system in various situations. The proposed feedback control mechanism has also been deployed on a commercial RTB platform and the online test has shown its success in generating controllable advertising performance.
Real-time bidding (RTB) based display advertising has become one of the key technological advances in computational advertising. RTB enables advertisers to buy individual ad impressions via an auction in real-time and facilitates the evaluation and the bidding of individual impressions across multiple advertisers. In RTB, the advertisers face three main challenges when optimizing their bidding strategies, namely (i) estimating the utility (e.g., conversions, clicks) of the ad impression, (ii) forecasting the market value (thus the cost) of the given ad impression, and (iii) deciding the optimal bid for the given auction based on the first two. Previous solutions assume the first two are solved before addressing the bid optimization problem. However, these challenges are strongly correlated and dealing with any individual problem independently may not be globally optimal. In this paper, we propose Bidding Machine, a comprehensive learning to bid framework, which consists of three optimizers dealing with each challenge above, and as a whole, jointly optimizes these three parts. We show that such a joint optimization would largely increase the campaign effectiveness and the profit. From the learning perspective, we show that the bidding machine can be updated smoothly with both offline periodical batch or online sequential training schemes. Our extensive offline empirical study and online A/B testing verify the high effectiveness of the proposed bidding machine.
Learning and predicting user responses, such as clicks and conversions, are crucial for many Internet-based businesses including web search, e-commerce, and online advertising. Typically, a user response model is established by optimizing the prediction accuracy, e.g., minimizing the error between the prediction and the ground truth user response. However, in many practical cases, predicting user responses is only part of a rather larger predictive or optimization task, where on one hand, the accuracy of a user response prediction determines the final (expected) utility to be optimized, but on the other hand, its learning may also be influenced from the follow-up stochastic process. It is, thus, of great interest to optimize the entire process as a whole rather than treat them independently or sequentially. In this paper, we take real-time display advertising as an example, where the predicted user's ad click-through rate (CTR) is employed to calculate a bid for an ad impression in the second price auction. We reformulate a common logistic regression CTR model by putting it back into its subsequent bidding context: rather than minimizing the prediction error, the model parameters are learned directly by optimizing campaign profit. The gradient update resulted from our formulations naturally fine-tunes the cases where the market competition is high, leading to a more costeffective bidding. Our experiments demonstrate that, while maintaining comparable CTR prediction accuracy, our proposed user response learning leads to campaign profit gains as much as 78.2% for offline test and 25.5% for online A/B test over strong baselines.
In this paper, we deal with the uncertainty of bidding for display advertising. Similar to the financial market trading, real-time bidding (RTB) based display advertising employs an auction mechanism to automate the impression level media buying; and running a campaign is no different than an investment of acquiring new customers in return for obtaining additional converted sales. Thus, how to optimally bid on an ad impression to drive the profit and return-on-investment becomes essential. However, the large randomness of the user behaviors and the cost uncertainty caused by the auction competition may result in a significant risk from the campaign performance estimation. In this paper, we explicitly model the uncertainty of user click-through rate estimation and auction competition to capture the risk. We borrow an idea from finance and derive the value at risk for each ad display opportunity. Our formulation results in two risk-aware bidding strategies that penalize risky ad impressions and focus more on the ones with higher expected return and lower risk. The empirical study on real-world data demonstrates the effectiveness of our proposed risk-aware bidding strategies: yielding profit gains of 15.4% in offline experiments and up to 17.5% in an online A/B test on a commercial RTB platform over the widely applied bidding strategies
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.
hi@scite.ai
10624 S. Eastern Ave., Ste. A-614
Henderson, NV 89052, USA
Copyright © 2024 scite LLC. All rights reserved.
Made with 💙 for researchers
Part of the Research Solutions Family.