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Chance constrained optimization for targeted Internet advertising

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  • Deza, Antoine
  • Huang, Kai
  • Metel, Michael R.

Abstract

We introduce a chance constrained optimization model for the fulfillment of guaranteed display Internet advertising campaigns. The proposed formulation for the allocation of display inventory takes into account the uncertainty of the supply of Internet viewers. We discuss and present theoretical and computational features of the model via Monte Carlo sampling and convex approximations. Theoretical upper and lower bounds are presented along with a numerical substantiation.

Suggested Citation

  • Deza, Antoine & Huang, Kai & Metel, Michael R., 2015. "Chance constrained optimization for targeted Internet advertising," Omega, Elsevier, vol. 53(C), pages 90-96.
    • Handle: RePEc:eee:jomega:v:53:y:2015:i:c:p:90-96
    DOI: 10.1016/j.omega.2014.12.007
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    References listed on IDEAS

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    1. Deane, Jason & Agarwal, Anurag, 2012. "Scheduling online advertisements to maximize revenue under variable display frequency," Omega, Elsevier, vol. 40(5), pages 562-570.
    2. John Turner, 2012. "The Planning of Guaranteed Targeted Display Advertising," Operations Research, INFORMS, vol. 60(1), pages 18-33, February.
    3. B. K. Pagnoncelli & S. Ahmed & A. Shapiro, 2009. "Sample Average Approximation Method for Chance Constrained Programming: Theory and Applications," Journal of Optimization Theory and Applications, Springer, vol. 142(2), pages 399-416, August.
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    5. Li, S. X., 1995. "An insurance and investment portfolio model using chance constrained programming," Omega, Elsevier, vol. 23(5), pages 577-585, October.
    6. Santanu S. Dey & Quentin Louveaux, 2011. "Split Rank of Triangle and Quadrilateral Inequalities," Mathematics of Operations Research, INFORMS, vol. 36(3), pages 432-461, August.
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    Cited by:

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    2. Tunuguntla, Vaishnavi & Basu, Preetam & Rakshit, Krishanu & Ghosh, Debabrata, 2019. "Sponsored search advertising and dynamic pricing for perishable products under inventory-linked customer willingness to pay," European Journal of Operational Research, Elsevier, vol. 276(1), pages 119-132.
    3. Beltran-Royo, C. & Escudero, L.F. & Zhang, H., 2016. "Multiperiod Multiproduct Advertising Budgeting: Stochastic Optimization Modeling," Omega, Elsevier, vol. 59(PA), pages 26-39.
    4. Ballings, Michel & Van den Poel, Dirk & Bogaert, Matthias, 2016. "Social media optimization: Identifying an optimal strategy for increasing network size on Facebook," Omega, Elsevier, vol. 59(PA), pages 15-25.
    5. Shinjini Pandey & Goutam Dutta & Harit Joshi, 2017. "Survey on Revenue Management in Media and Broadcasting," Interfaces, INFORMS, vol. 47(3), pages 195-213, June.
    6. Zhang, Jianqiang & He, Xiuli, 2019. "Targeted advertising by asymmetric firms," Omega, Elsevier, vol. 89(C), pages 136-150.

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