Revenue maximization and contract enforcement through representative bidding in ad auctions

Online advertising has become a tremendous business, and continues to grow rapidly. There are mainly two ways to distribute ads in online advertising: contracts and auctions. Previous researches usually focus on ad allocation through either contracts or auctions, while the problem of allocating ads simultaneously through both methods has not been carefully addressed. Jointly considering these two methods enables the publisher to globally allocates ads in a more efficient way, conforming to the actual needs of online advertising, but rises several critical challenges that cannot be solved by existing approaches. Our work aims to fill this gap and takes a deep investigation into this problem. In this paper, we consider the revenue maximization problem in online advertising, where the publisher sells ads to advertisers and also needs to satisfy the demands of the contracts. We discuss and tackle the emerged challenges based on a more practical contract model, and propose a bidding strategy for the publisher to satisfy the contract and maximize her total revenue. Our evaluation results demonstrate the good performance of our algorithm in fulfilling the contract and maximizing the revenue.