Wednesday, April 25, 2007

Talk on challenges in Web ad auctions

I enjoyed this Google Tech Talk by MSR post-doc Nicole Immorlica, "Challenges in the Design of Sponsored Search Auctions".

The talk starts with a short history of Web advertising and a description of the second price auction mechanism commonly used for pay-per-click advertising. I suspect many readers of this weblog would be interested in the discussion of click fraud starting at 12:34 that includes a discussion of common methods for detecting click fraud.

My favorite part started at 28:09 when Nicole brought up how advertisers with budget constraints wreak havoc on the efficiency of the generalized second price auction. She gave several examples where advertisers would not be truthful in their bids when they had limited budgets for their ads, yielding suboptimal outcomes for the auction.

Nicole ended with some thoughts on situations that can cause regular fluctuations in advertising auction bidding and how that kind of instability can be avoided.

Much of this talk appears to be covered in more detail in some of the papers Nicole co-authored, including an upcoming WWW 2007 paper, "Dynamics of bid optimization in online advertisement auctions" (PDF), and an older EC 2005 paper, "Multi-Unit Auctions with Budget-Constrained Bidders" (PDF).


Bud Gibson said...

Looks like a great tech talk. I've found a few through this blog. I wonder why they don't have a tech talk blog. You seem to have to just find them by accident.

Unknown said...

This RSS feed will give you the latest tech talks: