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Maximally representative allocations for guaranteed delivery advertising campaigns

Author

Listed:
  • R. McAfee
  • Kishore Papineni
  • Sergei Vassilvitskii

Abstract

There are around 400 advertising networks that match opportunities for “display” advertising, which include banner ads, video ads and indeed all ads other than text-based ads, on web pages and candidate advertisements. This is about a $${\$}25$$ billion business annually. The present study derives a method of pricing such advertisements based on their relative scarcity while ensuring that all campaigns obtain a reasonably representative sample of the relevant opportunities. The mechanism is well-behaved under supply uncertainty. A method based on the mechanism described in this paper was implemented by Yahoo! Inc. Copyright Springer-Verlag Berlin Heidelberg 2013

Suggested Citation

  • R. McAfee & Kishore Papineni & Sergei Vassilvitskii, 2013. "Maximally representative allocations for guaranteed delivery advertising campaigns," Review of Economic Design, Springer;Society for Economic Design, vol. 17(2), pages 83-94, June.
    • Handle: RePEc:spr:reecde:v:17:y:2013:i:2:p:83-94
    DOI: 10.1007/s10058-013-0141-2
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    References listed on IDEAS

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    1. Varian, Hal R, 1985. "Price Discrimination and Social Welfare," American Economic Review, American Economic Association, vol. 75(4), pages 870-875, September.
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    Cited by:

    1. Shen, Yuelin, 2018. "Pricing contracts and planning stochastic resources in brand display advertising," Omega, Elsevier, vol. 81(C), pages 183-194.
    2. Miguel A. Lejeune & John Turner, 2019. "Planning Online Advertising Using Gini Indices," Operations Research, INFORMS, vol. 67(5), pages 1222-1245, September.
    3. L. Elisa Celis & Gregory Lewis & Markus Mobius & Hamid Nazerzadeh, 2014. "Buy-It-Now or Take-a-Chance: Price Discrimination Through Randomized Auctions," Management Science, INFORMS, vol. 60(12), pages 2927-2948, December.
    4. Ying-Ju Chen, 2017. "Optimal Dynamic Auctions for Display Advertising," Operations Research, INFORMS, vol. 65(4), pages 897-913, August.
    5. Sami Najafi-Asadolahi & Kristin Fridgeirsdottir, 2014. "Cost-per-Click Pricing for Display Advertising," Manufacturing & Service Operations Management, INFORMS, vol. 16(4), pages 482-497, October.
    6. Susan Athey & Emilio Calvano & Joshua S. Gans, 2014. "The Impact of Consumer Multi-homing on Advertising Markets and Media Competition," CSEF Working Papers 379, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy, revised 27 Apr 2016.

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    More about this item

    Keywords

    Advertising; Representativeness; Mechanism design; Market design; Bidding; Exchange; D02; M37;
    All these keywords.

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • M37 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Advertising

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