Wednesday, November 16, 2011

11/08/2011

Performance based advertising works, it's a multi-billion dollar industry.

Competitive ratio - accuracy of online computation/optimal accuracy

Expected return - clickvalue * likelihood of click.

Diversity becomes important when showing more than one ad, for
instance you don't want to show competitor ads together.

It might be good to bias high CTR ads first when showing multiple ads,
so that users aren't turned off by lower CTR (offensive) ads.

Vickery Auction: Winner only pays price of second highest bidder. This
in practice produces truthful bidding strategies.

-Thomas Hayden