Method and system for pricing electronic advertisements

• US 20060122879A1
• Filed: 12/07/2004
• Published: 06/08/2006
• Est. Priority Date: 12/07/2004
• Status: Abandoned Application

• Current Assignee: Yahoo Holdings, Inc. (Verizon Communications Inc.)
• Original Assignee: Yahoo Holdings, Inc. (Verizon Communications Inc.)
• Inventors: O'Kelley, Brian
• Application Number:
  US11/006,121
• Publication Number:
  US 20060122879A1
• Time in Patent Office: Days
• US Class Current: 705/14.460
• CPC Class Codes: G06Q 30/00 Commerce
• CPC Class Codes: G06Q 30/0247 Calculate past, present or future revenues
• CPC Class Codes: G06Q 30/0254 based on statistics
• CPC Class Codes: G06Q 30/0275 Auctions
• CPC Class Codes: G06Q 30/0283 Price estimation or determination

Abstract

A system and method of pricing an electronic advertisement that includes receiving a request for an electronic advertisement to be presented to a visitor, setting a price of the electronic advertisement, and presenting the electronic advertisement to the visitor.

Claims

1. A method of pricing an electronic advertisement, the method comprising the steps of:

receiving a request for an electronic advertisement to be presented to a visitor;

setting a calculated price of said electronic advertisement using a conversion probability and an advertiser value; and

returning said electronic advertisement to be presented to said visitor.

2. The method of claim 1, wherein said electronic advertisement is returned when said calculated price meets a threshold price requirement.

3. The method of claim 1, further comprising selecting multiple electronic advertisements for calculating a price and returning an electronic advertisement of said multiple electronic advertisements having a highest calculated price.

4. The method of claim 1, wherein said conversion probability is a variable number calculated by tracking actual impressions, clicks, and conversions for said electronic advertisement.

5. The method of claim 1, wherein said conversion probability is a variable number calculated by tracking predicted impressions, clicks, and conversions for said electronic advertisement.

6. A method of selecting a best priced electronic advertisement from a group of dynamically priced and statically priced electronic advertisements comprising:

calculating expected revenue for all statically priced electronic advertisements;

calculating maximum expected revenue for all dynamically priced electronic advertisements;

conducting an auction to select the best electronic advertisement, wherein the best electronic advertisement is one from said group with the highest expected revenue; and

if the best electronic advertisement is dynamically priced, lowering the price of said best electronic advertisement to a point just greater than the second-best electronic advertisement from said auction.

7. A method of selecting an electronic advertisement to present to a visitor comprising:

receiving a request to present an electronic advertisement;

identifying electronic advertisements eligible to present; and

applying soft targeting to said electronic advertisements to eliminate those electronic advertisements that do not meet ROI targets for advertisers.

8. A method of pricing an electronic advertisement, the method comprising:

receiving a request for an electronic advertisement;

specifying a list of eligible electronic advertisements to return;

calculating a price for each of said eligible electronic advertisements based on real time projected performance of each of said electronic advertisements and an advertiser'"'"'s ROI constraints for each of said electronic advertisements; and

choosing an electronic advertisement that will provide a publisher a highest revenue given said ROI constraints established by said advertiser.

9. The method of claim 8, wherein said choosing includes holding an auction.

10. A method of pricing an electronic advertisement, the method comprising

receiving a request for an electronic advertisement to be presented to a visitor;

calculating a projected ROI for each electronic advertisement considered for selection, wherein each said projected ROI is calculated using a contemporaneously calculated conversion probability, an advertiser value, and an impression cost;

calculating an impression price for said electronic advertisement for each electronic advertisement considered for selection having a projected ROI satisfying a ROI threshold, wherein said impression price is calculated using said contemporaneously calculated conversion probability and said advertiser value; and

selecting and returning an electronic advertisement having a highest impression price.

11. The method of claim 10, further comprising adjusting an impression price for each electronic advertisement to the lesser price of an advertiser'"'"'s price constraint and said calculated impression price.

12. The method of claim 10, wherein said selecting and returning comprises auctioning electronic advertisements, having a calculated impression price, by incrementally increasing said calculated impression prices until individual price constraints for each electronic advertisement yield a winning electronic advertisement having a final impression price.

13. The method of claim 12, wherein only a portion of said electronic advertisements, comprising electronic advertisements having highest calculated prices, are considered for said auctioning.

14. The method of claim 10, wherein said advertiser value is assignable and modifiable by an advertiser.

15. A method of dynamically setting the price of an electronic advertisement, the method comprising:

receiving a request for an individual electronic advertisement from a web browser;

calculating an expected revenue for a publisher for each electronic advertisement with flexible pricing selected and eligible for consideration, wherein said expected revenue for said flexibly-priced electronic advertisements is calculated using a conversion probability and an advertiser value;

calculating an expected revenue for each electronic advertisement with fixed-rate pricing, wherein for each fixed-rate electronic advertisement said expected revenue is calculated using a real time conversion probability; and

returning an advertisement having a highest expected revenue to said web browser.

16. The method of claim 15, further comprising adjusting a price of said flexibly-priced electronic advertisements by auction to yield a final expected revenue of said flexibly priced electronic advertisements for consideration in selecting a highest-priced electronic advertisement.

17. The method of claim 15, wherein for cost-per-click electronic advertisements, a real time calculated probability of a click is used.

18. The method of claim 15, wherein for cost-per-action electronic advertisements, a real time calculated probability of conversion is used.

19. A method of dynamically setting the price of an electronic advertisement, said method comprising the steps of:

receiving a request for an electronic advertisement to be presented to a visitor;

calculating a projected ROI for each advertiser from each electronic advertisement considered for selection, wherein each said projected ROI is calculated by multiplying a real time conversion probability with an advertiser value, and then dividing by an impression cost set by a publisher;

calculating an impression price for each electronic advertisement considered for selection, wherein said impression price is calculated by multiplying said real time conversion probability with an advertiser value; and

selecting and returning an electronic advertisement having a highest calculated impression price.

20. The method of claim 19, further comprising determining a maximum impression price for each electronic advertisement considered for selection by selecting a lesser price between said calculated impression price and a price -limit set by an advertiser.

21. The method of claim 19, further comprising:

calculating an expected revenue from fixed-rate electronic advertisements by multiplying a real time conversion probability with a fixed rate; and

selecting a highest paying electronic advertisement among said fixed-rate electronic advertisements, said electronic advertisements with a calculated impression price, and electronic advertisements with a fixed impression price.

22. The method of claim 19, further comprising:

ranking electronic advertisements by expected revenue and selecting a first and second highest paying electronic advertisement; and

auctioning said two selected highest paying electronic advertisements according to advertiser constraints until there is a winning electronic advertisement.

23. A computer system for pricing electronic advertisements comprising:

a database operable to maintain electronic advertisements, advertiser data, and publisher data; and

a processor programed to;

receive a request for an electronic advertisement to be presented to a visitor;

calculate a projected ROI for each electronic advertisement considered for selection, wherein each said projected ROI is calculated using a contemporaneously calculated conversion probability, an advertiser value, and an impression cost;

calculate an impression price for said electronic advertisement for each electronic advertisement considered for selection having a projected ROI satisfying a ROI threshold, wherein said impression price is calculated using said contemporaneously calculated conversion probability and said advertiser value; and

select and return an electronic advertisement having a highest impression price.

24. The computer system of claim 23, further comprising considering expected revenue of fixed-rate electronic advertisements in selecting an electronic advertisement to return.

25. The computer system of claim 23 further comprising adjusting an impression price for each electronic advertisement as the lesser price of an advertiser'"'"'s price constraint and said calculated impression price.

26. The computer system of claim 23, wherein said selecting and returning comprises auctioning electronic advertisements, having a calculated impression price, by incrementally increasing said calculated impression prices until individual price constraints for each electronic advertisement yield a winning electronic advertisement having a final impression price.

27. The computer system of claim 26, wherein only a portion of said electronic advertisements, comprising electronic advertisements having highest calculated prices, are considered for said auctioning.

28. The computer system of claim 23, wherein said ROI threshold is assignable and modifiable by an advertiser.

29. A computer-readable medium whose contents enable a computer system to select and price an electronic advertisement for presenting to a visitor, the computer system executing the contents of the computer-readable medium by performing a program comprising the steps of:

receiving a request for an electronic advertisement to be presented to a visitor;

calculating a projected ROI for each electronic advertisement considered for selection, wherein each said projected ROI is calculated using a contemporaneously calculated conversion probability, an advertiser value, and an impression cost;

calculating an impression price for said electronic advertisement for each electronic advertisement considered for selection having a projected ROI satisfying a ROI threshold, wherein said impression price is calculated using said contemporaneously calculated conversion probability and said advertiser value; and

selecting and returning an electronic advertisement having a highest impression price.

30. An Internet advertising system for pricing electronic advertisements, the system comprising:

a database operable for maintaining flexibly-priced electronic advertisements, fixed-rate electronic advertisements, and fixed-price electronic advertisements, advertiser constraints, conversion probabilities, advertiser data, and publisher data; and

a web server operable to;

receive data from advertisers;

receive a request for an electronic advertisement from a web browser;

calculate an expected revenue for each advertisement with flexible pricing selected for consideration, wherein said expected revenue for each said flexibly priced electronic advertisement is calculated by multiplying a real time conversion probability with an advertiser value;

calculate an expected revenue for cost-per-conversion ads by multiplying a real time conversion probability with an advertiser value;

calculate an expected revenue for cost-per-click ads by multiplying a real time click probability with an advertiser value;

rank all considered electronic advertisements by expected revenue;

choose a first and second best electronic advertisement by expected revenue;

decrease an expected revenue of said second best electronic advertisement by one bidding increment when said first and second best electronic advertisements have a same expected revenue;

set a price of said first best electronic advertisement to one increment more than an expected revenue of said second best electronic advertisement when said first best electronic advertisement has pricing flexibility;

set a price of flexibly-priced electronic advertisements to a greater price of a bidding increment and an advertiser'"'"'s minimum price constraint when there is no second best electronic advertisement; and

return a highest-priced electronic advertisement to said web browser.