research-article

Ranking and Tradeoffs in Sponsored Search Auctions

Authors:

Dinan Gunawardena,

Peter KeyAuthors Info & Claims

ACM Transactions on Economics and Computation (TEAC), Volume 4, Issue 3

Article No.: 17, Pages 1 - 21

https://doi.org/10.1145/2910576

Published: 15 June 2016 Publication History

Abstract

In a sponsored search auction, decisions about how to rank ads impose tradeoffs between objectives, such as revenue and welfare. In this article, we examine how these tradeoffs should be made. We begin by arguing that the most natural solution concept to evaluate these tradeoffs is the lowest symmetric Nash equilibrium (SNE). As part of this argument, we generalise the well-known connection between the lowest SNE and the VCG outcome. We then propose a new ranking algorithm, loosely based on the revenue-optimal auction, that uses a reserve price to order the ads (not just to filter them) and give conditions under which it raises more revenue than simply applying that reserve price. Finally, we conduct extensive simulations examining the tradeoffs enabled by different ranking algorithms and show that our proposed algorithm enables superior operating points by a variety of metrics.

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Cited By

Zhang ZLi WLei YWang BZhang ZQi QLiu QWang XBaeza-Yates RBonchi F(2024)Joint Auction in the Online Advertising MarketProceedings of the 30th ACM SIGKDD Conference on Knowledge Discovery and Data Mining10.1145/3637528.3671746(4362-4373)Online publication date: 25-Aug-2024
https://dl.acm.org/doi/10.1145/3637528.3671746
Li WQi QWang CYu C(2023)Optimally integrating ad auction into e-commerce platformsTheoretical Computer Science10.1016/j.tcs.2023.114141976(114141)Online publication date: Oct-2023
https://doi.org/10.1016/j.tcs.2023.114141
Li QWang LXia LZheng WZhou Y(2023)A practical multi-objective auction design and optimization framework for sponsored searchOperations Research Letters10.1016/j.orl.2023.09.00151:6(541-547)Online publication date: Nov-2023
https://doi.org/10.1016/j.orl.2023.09.001
Show More Cited By

Index Terms

Ranking and Tradeoffs in Sponsored Search Auctions
1. Applied computing
  1. Law, social and behavioral sciences
    1. Economics

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Published In

cover image ACM Transactions on Economics and Computation

ACM Transactions on Economics and Computation Volume 4, Issue 3

Special Issue on EC'13

June 2016

162 pages

ISSN:2167-8375

EISSN:2167-8383

DOI:10.1145/2905047

Editors:
Vincent Conitzer
Duke University
,
Preston McAfee
Microsoft

Issue’s Table of Contents

Copyright © 2016 ACM.

Permission to make digital or hard copies of all or part of this work for personal or classroom use is granted without fee provided that copies are not made or distributed for profit or commercial advantage and that copies bear this notice and the full citation on the first page. Copyrights for components of this work owned by others than the author(s) must be honored. Abstracting with credit is permitted. To copy otherwise, or republish, to post on servers or to redistribute to lists, requires prior specific permission and/or a fee. Request permissions from [email protected].

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Association for Computing Machinery

New York, NY, United States

Publication History

Published: 15 June 2016

Accepted: 01 March 2016

Revised: 01 December 2015

Received: 01 November 2013

Published in TEAC Volume 4, Issue 3

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Cited By

Zhang ZLi WLei YWang BZhang ZQi QLiu QWang XBaeza-Yates RBonchi F(2024)Joint Auction in the Online Advertising MarketProceedings of the 30th ACM SIGKDD Conference on Knowledge Discovery and Data Mining10.1145/3637528.3671746(4362-4373)Online publication date: 25-Aug-2024
https://dl.acm.org/doi/10.1145/3637528.3671746
Li WQi QWang CYu C(2023)Optimally integrating ad auction into e-commerce platformsTheoretical Computer Science10.1016/j.tcs.2023.114141976(114141)Online publication date: Oct-2023
https://doi.org/10.1016/j.tcs.2023.114141
Li QWang LXia LZheng WZhou Y(2023)A practical multi-objective auction design and optimization framework for sponsored searchOperations Research Letters10.1016/j.orl.2023.09.00151:6(541-547)Online publication date: Nov-2023
https://doi.org/10.1016/j.orl.2023.09.001
Li WQi QWang CYu C(2022)Optimally Integrating Ad Auction into E-Commerce PlatformsFrontiers of Algorithmic Wisdom10.1007/978-3-031-20796-9_4(44-58)Online publication date: 15-Aug-2022
https://dl.acm.org/doi/10.1007/978-3-031-20796-9_4
Zhang ZLiu XZheng ZZhang CXu MPan JYu CWu FXu JGai KLewin-Eytan LCarmel DYom-Tov EAgichtein EGabrilovich E(2021)Optimizing Multiple Performance Metrics with Deep GSP Auctions for E-commerce AdvertisingProceedings of the 14th ACM International Conference on Web Search and Data Mining10.1145/3437963.3441771(993-1001)Online publication date: 8-Mar-2021
https://dl.acm.org/doi/10.1145/3437963.3441771
Arapakis IPenta AJoho HLeiva L(2020)A Price-per-attention Auction Scheme Using Mouse Cursor InformationACM Transactions on Information Systems10.1145/337421038:2(1-30)Online publication date: 27-Jan-2020
https://dl.acm.org/doi/10.1145/3374210

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