The emergence of real-time auction in online advertising has drawn huge attention of modeling the market competition, i.e., bid landscape forecasting. The problem is formulated as to forecast the probability distribution of market price for each ad auction. With the consideration of the censorship issue which is caused by the second-price auction mechanism, many researchers have devoted their efforts on bid landscape forecasting by incorporating survival analysis from medical research field. However, most existing solutions mainly focus on either counting-based statistics of the segmented sample clusters, or learning a parameterized model based on some heuristic assumptions of distribution forms. Moreover, they neither consider the sequential patterns of the feature over the price space. In order to capture more sophisticated yet flexible patterns at fine-grained level of the data, we propose a Deep Landscape Forecasting (DLF) model which combines deep learning for probability distribution forecasting and survival analysis for censorship handling. Specifically, we utilize a recurrent neural network to flexibly model the conditional winning probability w.r.t. each bid price. Then we conduct the bid landscape forecasting through probability chain rule with strict mathematical derivations. And, in an end-to-end manner, we optimize the model by minimizing two negative likelihood losses with comprehensive motivations. Without any specific assumption for the distribution form of bid landscape, our model shows great advantages over previous works on fitting various sophisticated market price distributions. In the experiments over two large-scale real-world datasets, our model significantly outperforms the state-of-the-art solutions under various metrics.
In the view of distribution modeling methods, there are two phases. In the early phase, researchers proposed several heuristic forms of functions to model the market price distribution. In @cite_7 @cite_32 @cite_1 , the authors provided some analytic forms of winning probability w.r.t. the bid price applied on the campaign level, which is based on the observation of the winning logs. Later in the recent researches, some well-studied distributions are applied in market price modeling. presented a log-normal distribution to model the market price ground truth. proposed a regression model based on Gaussian distribution to fit the market price. Recently, Gamma distribution for market price modeling has also been studied in the work @cite_18 . The main drawback of these distributional methods is that these restricted empirical preassumptions may lose the effectiveness of handling various dynamic data and they even ignore the sophisticated real data divergence as we show in Figure .
@cite_18 @cite_1 @cite_32 @cite_7
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In Real-Time Bidding (RTB) advertising, estimating the winning price is an important task in evaluating the bid cost of bid requests in Demand-Side Platforms (DSPs). The prior works utilize censored linear regression for winning price estimation by considering both winning and losing bid records. In the traditional regression models, the winning price of each bid request is based on Gaussian distribution. However, the property of Gaussian distribution is not suitable for the winning price of each bid request, and it is hard to link the physical meaning of Gaussian distribution and the winning price. Therefore, in this paper, based on our observation and analysis, the winning price of each bid request is modeled by a unique gamma distribution with respect to its features. Then we propose a gamma-based censored linear regression with regularization for winning price estimation. To derive the parameters of our proposed complicated model based on bid records, our approach is to divide this hard problem into two sub-problems, which are easier to solve. In practice, we also provide four heuristic initial parameter settings that are able to greatly reduce the computation cost when deriving the parameters. The experimental results demonstrate that our approach is highly effective for estimating the winning price compared with the state-of-the-art approaches in three real datasets. Learning and predicting user responses, such as clicks and conversions, are crucial for many Internet-based businesses including web search, e-commerce, and online advertising. Typically, a user response model is established by optimizing the prediction accuracy, e.g., minimizing the error between the prediction and the ground truth user response. However, in many practical cases, predicting user responses is only part of a rather larger predictive or optimization task, where on one hand, the accuracy of a user response prediction determines the final (expected) utility to be optimized, but on the other hand, its learning may also be influenced from the follow-up stochastic process. It is, thus, of great interest to optimize the entire process as a whole rather than treat them independently or sequentially. In this paper, we take real-time display advertising as an example, where the predicted user's ad click-through rate (CTR) is employed to calculate a bid for an ad impression in the second price auction. We reformulate a common logistic regression CTR model by putting it back into its subsequent bidding context: rather than minimizing the prediction error, the model parameters are learned directly by optimizing campaign profit. The gradient update resulted from our formulations naturally fine-tunes the cases where the market competition is high, leading to a more cost-effective bidding. Our experiments demonstrate that, while maintaining comparable CTR prediction accuracy, our proposed user response learning leads to campaign profit gains as much as 78.2 for offline test and 25.5 for online A B test over strong baselines. Real-time bidding (RTB) based display advertising has become one of the key technological advances in computational advertising. RTB enables advertisers to buy individual ad impressions via an auction in real-time and facilitates the evaluation and the bidding of individual impressions across multiple advertisers. In RTB, the advertisers face three main challenges when optimizing their bidding strategies, namely (i) estimating the utility (e.g., conversions, clicks) of the ad impression, (ii) forecasting the market value (thus the cost) of the given ad impression, and (iii) deciding the optimal bid for the given auction based on the first two. Previous solutions assume the first two are solved before addressing the bid optimization problem. However, these challenges are strongly correlated and dealing with any individual problem independently may not be globally optimal. In this paper, we propose Bidding Machine , a comprehensive learning to bid framework, which consists of three optimizers dealing with each challenge above, and as a whole, jointly optimizes these three parts. We show that such a joint optimization would largely increase the campaign effectiveness and the profit. From the learning perspective, we show that the bidding machine can be updated smoothly with both offline periodical batch or online sequential training schemes. Our extensive offline empirical study and online A B testing verify the high effectiveness of the proposed bidding machine. In this paper we study bid optimisation for real-time bidding (RTB) based display advertising. RTB allows advertisers to bid on a display ad impression in real time when it is being generated. It goes beyond contextual advertising by motivating the bidding focused on user data and it is different from the sponsored search auction where the bid price is associated with keywords. For the demand side, a fundamental technical challenge is to automate the bidding process based on the budget, the campaign objective and various information gathered in runtime and in history. In this paper, the programmatic bidding is cast as a functional optimisation problem. Under certain dependency assumptions, we derive simple bidding functions that can be calculated in real time; our finding shows that the optimal bid has a non-linear relationship with the impression level evaluation such as the click-through rate and the conversion rate, which are estimated in real time from the impression level features. This is different from previous work that is mainly focused on a linear bidding function. Our mathematical derivation suggests that optimal bidding strategies should try to bid more impressions rather than focus on a small set of high valued impressions because according to the current RTB market data, compared to the higher evaluated impressions, the lower evaluated ones are more cost effective and the chances of winning them are relatively higher. Aside from the theoretical insights, offline experiments on a real dataset and online experiments on a production RTB system verify the effectiveness of our proposed optimal bidding strategies and the functional optimisation framework.