Abstract
Display advertising has traditionally been sold via guaranteed contracts – a guaranteed contract is a deal between a publisher and an advertiser to allocate a certain number of impressions over a certain period, for a pre-specified price per impression. However, as spot markets for display ads, such as the RightMedia Exchange, have grown in prominence, the selection of advertisements to show on a given page is increasingly being chosen based on price, using an auction. As the number of participants in the exchange grows, the price of an impressions becomes a signal of its value. This correlation between price and value means that a seller implementing the contract through bidding should offer the contract buyer a range of prices, and not just the cheapest impressions necessary to fulfill its demand.
Implementing a contract using a range of prices, is akin to creating a mutual fund of advertising impressions, and requires randomized bidding. We characterize what allocations can be implemented with randomized bidding, namely those where the desired share obtained at each price is a non-increasing function of price. In addition, we provide a full characterization of when a set of campaigns are compatible and how to implement them with randomized bidding strategies.
A full version of this paper appears in [6].
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Ghosh, A., McAfee, P., Papineni, K., Vassilvitskii, S. (2009). Bidding for Representative Allocations for Display Advertising. In: Leonardi, S. (eds) Internet and Network Economics. WINE 2009. Lecture Notes in Computer Science, vol 5929. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-10841-9_20
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DOI: https://doi.org/10.1007/978-3-642-10841-9_20
Publisher Name: Springer, Berlin, Heidelberg
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