Sharad Goel
Yahoo! Research
"Contract Auctions for Web Advertising"
Today's leading web search companies derive the majority of their revenue from auctioning off ad placement next to search results. In these so-called sponsored search auctions, advertisers typically pay search providers a fixed amount per click that their advertisements receive. In particular, the advertiser and the search provider enter into a contract (i.e., the search provider displays the ad; the advertiser pays the provider x cents per click), and each party's subjective value for the contract depends on their estimated probability of the ad being clicked. Starting from this motivating example, we define and analyze a class of dominant strategy, incentive-compatible auctions that generalize the classical second price auction. That is, we design auctions without money. As an application, we introduce a mechanism for impression-plus-click sponsored search pricing, in which advertisers pay a fixed amount per impression plus an additional amount if their ad is clicked. This is joint work with Sebastien Lahaie and Sergei Vassilvitskii.
Host: Chris Wiggins
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