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Optimal keyword bidding in search-based advertising with budget constraint and stochastic ad position

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dc.contributor.authorKüçükaydın, Hande
dc.contributor.authorSelçuk, Bariş
dc.contributor.authorÖzlük, Özgür
dc.contributor.institutionKüçükaydın, Hande, Department of Industrial Engineering, MEF University, Istanbul, Turkey
dc.contributor.institutionSelçuk, Bariş, Department of Industrial Engineering, Bahçeşehir Üniversitesi, Istanbul, Turkey
dc.contributor.institutionÖzlük, Özgür, Department of Industrial Engineering, MEF University, Istanbul, Turkey
dc.date.accessioned2025-10-05T15:49:01Z
dc.date.issued2020
dc.description.abstractThis paper analyses the search-based advertising problem from an advertiser’s view point, and proposes optimal bid prices for a set of keywords targeted for the advertising campaign. The advertiser aims to maximise its expected potential revenue given a total budget constraint from a search-based advertising campaign. Optimal bid prices are formulated by considering various characteristics of the keywords such that the expected revenue from a keyword is a function of the ad’s position on the search page, and the ad position is a stochastic function of both the bid price and the competitive landscape for that keyword. We explore this problem analytically and numerically in an effort to generate important managerial insights for campaign setters. © 2020 Elsevier B.V., All rights reserved.
dc.identifier.doi10.1080/01605682.2019.1567650
dc.identifier.endpage578
dc.identifier.issn14769360
dc.identifier.issn01605682
dc.identifier.issue4
dc.identifier.scopus2-s2.0-85064686533
dc.identifier.startpage566
dc.identifier.urihttps://doi.org/10.1080/01605682.2019.1567650
dc.identifier.urihttps://hdl.handle.net/20.500.14719/10513
dc.identifier.volume71
dc.language.isoen
dc.publisherTaylor and Francis Ltd. michael.wagreich@univie.ac.at
dc.relation.sourceJournal of the Operational Research Society
dc.subject.authorkeywordsInternet
dc.subject.authorkeywordsKnapsack Problem
dc.subject.authorkeywordsNonlinear Optimisation
dc.subject.authorkeywordsPricing
dc.subject.authorkeywordsSearch-based Advertising
dc.subject.authorkeywordsStochastic Models
dc.subject.authorkeywordsBudget Control
dc.subject.authorkeywordsCombinatorial Optimization
dc.subject.authorkeywordsCosts
dc.subject.authorkeywordsEconomics
dc.subject.authorkeywordsInternet
dc.subject.authorkeywordsMarketing
dc.subject.authorkeywordsNonlinear Programming
dc.subject.authorkeywordsStochastic Systems
dc.subject.authorkeywordsAdvertising Campaign
dc.subject.authorkeywordsBudget Constraint
dc.subject.authorkeywordsExpected Revenue
dc.subject.authorkeywordsKnapsack Problems
dc.subject.authorkeywordsNon-linear Optimisation
dc.subject.authorkeywordsPotential Revenue
dc.subject.authorkeywordsSearch-based
dc.subject.authorkeywordsStochastic Functions
dc.subject.authorkeywordsStochastic Models
dc.subject.indexkeywordsBudget control
dc.subject.indexkeywordsCombinatorial optimization
dc.subject.indexkeywordsCosts
dc.subject.indexkeywordsEconomics
dc.subject.indexkeywordsInternet
dc.subject.indexkeywordsMarketing
dc.subject.indexkeywordsNonlinear programming
dc.subject.indexkeywordsStochastic systems
dc.subject.indexkeywordsAdvertising campaign
dc.subject.indexkeywordsBudget constraint
dc.subject.indexkeywordsExpected revenue
dc.subject.indexkeywordsKnapsack problems
dc.subject.indexkeywordsNon-linear optimisation
dc.subject.indexkeywordsPotential revenue
dc.subject.indexkeywordsSearch-based
dc.subject.indexkeywordsStochastic functions
dc.subject.indexkeywordsStochastic models
dc.titleOptimal keyword bidding in search-based advertising with budget constraint and stochastic ad position
dc.typeArticle
dcterms.referencesAbhishek, Vibhanshu, Optimal bidding in multi-item multislot sponsored search auctions, Operations Research, 61, 4, pp. 855-873, (2013), Amaldoss, Wilfred, Keyword search advertising and first-page bid estimates: A strategic analysis, Management Science, 61, 3, pp. 507-519, (2015), Ayanso, Anteneh, The moderating effects of keyword competition on the determinants of ad position in sponsored search advertising, Decision Support Systems, 70, pp. 42-59, (2015), Ayanso, Anteneh, Efficiency evaluation in search advertising, Decision Sciences, 44, 5, pp. 877-913, (2013), Operations Research, (1995), Bretthauer, Kurt M., The nonlinear knapsack problem - Algorithms and applications, European Journal of Operational Research, 138, 3, pp. 459-472, (2002), Atlas Rank Report II how Search Engine Rank Impacts Conversions, (2004), Chan, Tat Y., Measuring the lifetime value of customers acquired from Google search advertising, Marketing Science, 30, 5, pp. 837-850, (2011), Cholette, Susan C., Optimal Keyword Bids in Search-Based Advertising with Stochastic Advertisement Positions, Journal of Optimization Theory and Applications, 152, 1, pp. 225-244, (2012), Devenur, Nikhil R., The adwords problem: Online keyword matching with budgeted bidders under random permutations, Proceedings of the ACM Conference on Electronic Commerce, pp. 71-78, (2009)
dspace.entity.typePublication
local.indexed.atScopus
person.identifier.scopus-author-id36655949100
person.identifier.scopus-author-id14622013500
person.identifier.scopus-author-id16230962700

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