An analysis of alternative slot auction designs for sponsored search

Lahaie, Sébastien

doi:10.1145/1134707.1134731

Cited by 106 publications

(90 citation statements)

References 17 publications

(40 reference statements)

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“…Ad Auctions in general have received a lot of recent attention (see, e.g., [2,4,13,15,16]). Many of the core theoretical results (e.g., [8,17,2,14]) are based on the simplifying assumption of separable click-through rates.…”

Section: Related Workmentioning

confidence: 99%

A Cascade Model for Externalities in Sponsored Search

Kempe

Mahdian

2008

Lecture Notes in Computer Science

151

136

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Abstract. One of the most important yet insufficiently studied issues in online advertising is the externality effect among ads: the value of an ad impression on a page is affected not just by the location that the ad is placed in, but also by the set of other ads displayed on the page. For instance, a high quality competing ad can detract users from another ad, while a low quality ad could cause the viewer to abandon the page altogether. In this paper, we propose and analyze a model for externalities in sponsored search ads. Our model is based on the assumption that users will visually scan the list of ads from the top to the bottom. After each ad, they make independent random decisions with ad-specific probabilities on whether to continue scanning. We then generalize the model in two ways: allowing for multiple separate blocks of ads, and allowing click probabilities to explicitly depend on ad positions as well. For the most basic model, we present a polynomial-time incentive-compatible auction mechanism for allocating and pricing ad slots. For the generalizations, we give approximation algorithms for the allocation of ads.

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Section: Related Workmentioning

confidence: 99%

A Cascade Model for Externalities in Sponsored Search

Kempe

Mahdian

2008

Lecture Notes in Computer Science

151

136

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“…These ad auctions are responsible for the majority of the revenue of today's leading search engines [10]. Edelman et al [3] and Varian [15] provide the standard model for sponsored search auctions and analyze its equilibrium properties (see also Lahaie et al [11] for a survey of the literature in this area).…”

Section: Background and Related Workmentioning

confidence: 99%

Contract Auctions for Sponsored Search

Goel

Lahaie

Vassilvitskii

2009

Lecture Notes in Computer Science

Self Cite

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Abstract. In sponsored search auctions advertisers typically pay a fixed amount per click that their advertisements receive. In particular, the advertiser and the publisher enter into a contract (e.g., the publisher displays the ad; the advertiser pays the publisher 10 cents per click), and each party's subjective value for such a contract depends on their estimated click-through rates (CTR) for the ad. Starting from this motivating example, we define and analyze a class of contract auctions that generalize the classical second price auction. As an application, we introduce impression-plus-click pricing for sponsored search, in which advertisers pay a fixed amount per impression plus an additional amount if their ad is clicked. Of note, when the advertiser's estimated CTR is higher than the publisher's estimated CTR, both parties find negative click payments advantageous, where the advertiser pays the publisher a premium for the impression but the publisher then pays the advertiser per click.

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“…In addition the bidders do not know the other bids or click-through rates. This makes the advertiser's optimization problem much more difficult (see e.g., [28,7,9,17,43,30,45,40,39] …”

Section: Practical Aspectsmentioning

confidence: 99%

Algorithmic Methods for Sponsored Search Advertising

Feldman,

Muthukrishnan

2008

Performance Modeling and Engineering

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Modern commercial Internet search engines display advertisements along side the search results in response to user queries. Such sponsored search relies on market mechanisms to elicit prices for these advertisements, making use of an auction among advertisers who bid in order to have their ads shown for specific keywords. We present an overview of the current systems for such auctions and also describe the underlying game-theoretic aspects. The game involves three partiesadvertisers, the search engine, and search users-and we present example research directions that emphasize the role of each. The algorithms for bidding and pricing in these games use techniques from three mathematical areas: mechanism design, optimization, and statistical estimation. Finally, we present some challenges in sponsored search advertising.

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An analysis of alternative slot auction designs for sponsored search

Cited by 106 publications

References 17 publications

A Cascade Model for Externalities in Sponsored Search

A Cascade Model for Externalities in Sponsored Search

Contract Auctions for Sponsored Search

Algorithmic Methods for Sponsored Search Advertising

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