Bid Modifier Calculation for Hybrid Campaign ROI
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Solution Overview
Problem
It is challenging for systems to determine an auction bid on behalf of a third-party content provider that maximizes a specified goal, such as exposure or online sales, due to disparate objectives among content providers and the difficulty in developing effective bid strategies across different device types.
Innovation Solution
A method and system that determine a bid modifier value by calculating predicted conversion rates for different device types and using these rates to relate bids across device types, optimizing the return on investment in hybrid campaigns by adjusting bids based on predicted campaign-level conversion rates.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Device complexity
If a single bid strategy is used for all device types, then the system complexity is reduced, but the return on investment cannot be optimized for each device type's specific conversion characteristics
Solution Approach 1:
The patent segments the bid strategy by device type, creating separate bid modifiers for different device categories (e.g., mobile, desktop, tablet). This allows each device type to have its own conversion rate-based bid adjustment, optimizing ROI for each segment while maintaining a unified auction bidding framework.
Solution Approach 2:
The patent changes the bid parameter dynamically based on device type and predicted conversion rates. By adjusting bid modifiers according to device-specific conversion characteristics, the system optimizes bidding parameters for each device type without requiring completely separate bidding systems.
2Productivity
If device-specific bid strategies are implemented, then the return on investment is optimized for each device type, but the system complexity and difficulty of managing multiple bid strategies increases
Solution Approach 1:
The patent creates a universal bid modifier framework that handles multiple device types through a single systematic approach. The same core algorithm (calculating bid modifiers based on conversion rates) applies across all device types, providing multi-functionality without requiring device-specific complex logic for each type.
Solution Approach 2:
The system automatically calculates and applies device-specific bid modifiers based on predicted conversion rates, eliminating the need for manual bid strategy management for each device type. The automated nature of the system reduces management complexity while maintaining optimized bidding for each device category.
3Measurement precision
If conversion rate prediction is performed for each keyword and device type combination, then the bid optimization precision is improved, but the computational complexity and data processing requirements increase
Solution Approach 1:
The patent applies bid modifiers at the keyword level where conversion rate data is most relevant and actionable, rather than attempting to optimize every possible parameter combination. This partial action approach focuses computational resources on the most impactful bid adjustments while avoiding unnecessary complexity in areas with insufficient data.
Data Source
AI summary
Systems and methods for determining a bid modifier value include determining, for one or more sets of keywords used in a campaign, a predicted conversion rate for a first device type and a predicted conversion rate for a second device type. Predicted campaign-level conversion rates are determined for the first and second device types using the predicted conversion rates for the one or more sets of keywords used in the campaign. A ratio is also determined between the predicted campaign-level conversion rate for the first device type and the predicted campaign-level conversion rate for the second device type. The ratio may be used as a bid modifier value that relates bids for the first device type to bids for the second device type.