Séminaire commun FDD-FiME // H. Pham
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Séminaire commun FDD-FiME // H. Pham
4 février 2022 @ 14 h 00 min - 15 h 00 min
Huyên Pham (LPSM, Université de Paris)
Titre: Optimal bidding strategies for digital advertising with social interactions
A joint work with Médéric Motte (LPSM).
Abstract:
With the emergence of new online channels and information technology, digital advertising tends to substitute more and more to traditional advertising by offering the opportunity to companies to target the consumers/users that are potentially interested by their products or services. We introduce a continuous time model for the study of optimal bidding strategies associated to different types of advertising, namely, commercial advertising for triggering purchases or subscriptions, and social marketing for alerting population about unhealthy behaviours (anti-drug, vaccination, road-safety campaigns). Our framework encodes users online behaviours via their web-browsing at random times, social interactions in a large population of users, and the targeted advertising auction mechanism widely used on Internet. We address the attribution problem of how to efficiently diffuse advertising information by means of digital channels in order to generate conversion. Our main results are to provide semi-explicit formulas for the optimal value and bidding policy. We show sensitivity properties of the solution with respect to model parameters, and analyse how the different sources of digital information accessible to users including the social interactions affect the optimal bid for advertising auctions. We also study how to efficiently combine targeted advertising and non-targeted advertising mechanisms.