Bid Rate Control for Spend Pacing in Distributed Bidding
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Solution Overview
Problem
Current spend pacing methods in online advertising, which rely on proportional allocation, fail to provide a natural upper bound on bids, leading to overspending or underspending when traffic fluctuates, especially in decentralized and globally distributed systems, and are vulnerable to communication delays and system failures.
Innovation Solution
Implementing a bid rate control system where a global bidding manager communicates spend rates to local managers, determining bid rates based on allocated spend rates to manage the number of bids per time unit, ensuring consistent spending throughout the day and providing immunity to fluctuations and system failures.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If proportional allocation is used to pace advertisement spend across time duration, then budget exhaustion is prevented and bid opportunities are maintained throughout the day, but overspending or underspending occurs when advertisement traffic fluctuates
Solution Approach 1:
The system dynamically adjusts bid rates based on real-time spend pacing performance. When traffic fluctuates, the system modifies the number of bids placed per time unit to maintain consistent spend pacing, transitioning from static proportional allocation to dynamic bid rate adjustment that responds to actual spend conditions
Solution Approach 2:
The system implements feedback mechanisms where bid rates are continuously monitored and adjusted based on actual spend performance. The feedback loop compares actual spend against target spend pacing and adjusts bid rates accordingly, enabling the system to correct overspending or underspending conditions automatically
2Productivity
If proportional allocation is used for spend pacing, then budget is distributed evenly over time, but the system lacks upper bound control on bids leading to overspending during high traffic periods
Solution Approach 1:
The system changes the controlling parameter from proportional allocation ratios to absolute bid rates (number of bids per time unit). This parameter change enables direct control over bid volume while maintaining spend pacing, allowing the system to prevent overspending during high traffic periods by capping bid rates rather than relying on proportional distribution
3Adaptability or versatility
If decentralized bidding system is implemented to handle global traffic, then system scalability is improved, but communication delays and system failures increase vulnerability to spend pacing control
Solution Approach 1:
The system performs preliminary calculations of bid rates locally at each bidding manager before actual bidding occurs. By pre-computing bid rates based on allocated spend and local traffic conditions, the system reduces real-time communication dependencies and can maintain spend pacing control even during communication delays or partial system outages
Solution Approach 2:
Local bidding managers operate autonomously using locally stored spend allocation and traffic data to determine bid rates without constant central coordination. This self-service capability allows the decentralized system to maintain spend pacing control independently at each node, reducing vulnerability to communication failures while preserving global scalability
Data Source
AI summary
Embodiments of the present invention relate to facilitating control of advertisement spending. In embodiments, a spend rate allocated to a datacenter having a plurality of bidders is referenced. The spend rate allocated to the data center is used to determine a spend rate per bidder for each of the plurality of bidders within the datacenter. For each bidder, the spend rate per bidder is used to generate a bid rate indicating a number of advertisement bids to place per unit of time in accordance with a real time advertisement auction. Each bid rate generated for the corresponding bidder is intended to result in placement of an amount of advertisement bids that correspond with the spend rate per bidder. The bid rates are provided to the plurality of bidders, wherein each of the plurality of bidders uses the corresponding bid rate to determine whether to place a bid for an advertisement.