Dynamic Advertisement Budget Allocation via Response Extrapolation
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Solution Overview
Problem
Fixed budget allocation for advertisements over an advertisement period can be inflexible and inefficient, failing to match actual user responses, leading to overspending or underperformance in achieving response targets.
Innovation Solution
A method involving a server that allocates a budget to advertisement opportunities by measuring user responses during initial subperiods, extrapolating these responses to the entire period, and adjusting subsequent budget allocations to meet response targets, ensuring flexible and efficient allocation.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Ease of manufacture
If fixed budget allocation is used for advertisements over an advertisement period, then the allocation process is simple and predetermined, but the allocation becomes inflexible and inefficient, failing to match actual user responses
Solution Approach 1:
The patent transforms the static, fixed budget allocation into a dynamic system that continuously adapts based on real-time user response data. The allocation mechanism adjusts budget distribution across subperiods and advertisement opportunities based on measured performance metrics, enabling the system to respond flexibly to changing user behavior while maintaining automated control.
2Loss of time
If budget is allocated in fixed increments over advertisement subperiods in advance, then the allocation is predetermined and simple to manage, but the actual user response does not match projections, leading to overspending or underperformance
Solution Approach 1:
The patent implements a feedback mechanism where user response data measured during each subperiod is fed back into the allocation system. This feedback loop enables continuous refinement of budget allocation decisions, comparing actual performance against projections and adjusting subsequent allocations to stay on track for achieving response targets, thereby improving reliability without significant time loss.
3Adaptability or versatility
If advertiser manually monitors and adjusts budget allocation based on updated estimations, then some flexibility is achieved, but the adjustments may fail to promote advertiser targets, resulting in overspending or inefficient resource use
Solution Approach 1:
The patent enables the allocation system to serve itself by automatically measuring user responses, analyzing performance data, and adjusting budget allocations without requiring manual advertiser intervention. This self-service capability ensures consistent, data-driven decisions that optimize resource efficiency while maintaining the flexibility to adapt to real-time performance variations.
4Quantity of substance
If increased budget allocation is made during a subperiod with historically favorable user response, then the advertiser may overspend without achieving proportional increase in user response
Solution Approach 1:
The patent applies partial action by making proportional rather than excessive budget adjustments. When user response is favorable in a subperiod, the system increases allocation moderately to capture additional value without overspending. The adjustment is calibrated based on the measured performance and remaining budget, ensuring that increased spend translates to proportional gains in user response and maintains efficient resource utilization.
Data Source
AI summary
Advertisement budgets are often apportioned over an advertisement period, such as apportioning fixed increments of the budget over subperiods of the advertisement period. Each allocation of the budget may be used for auctions of advertisement opportunities during the subperiod. However, fixed apportioning may not be responsive to the actual user response, and manual adjustment of the budget may provide an efficient allocation in view of an advertiser's response target, resulting in overspending, underspending (wherein resulting user response fails to meet a response target), and/or inefficient allocation of the budget. Instead, a server may measure the user response during a first advertisement subperiod, extrapolate the user response over the advertisement period, and compare the extrapolated user response to the response target. Based on the comparison, budget allocation during a second advertisement subperiod may be adjusted by an allocation offset that adapts the allocation of the advertisement budget to the response target.