Method for Summarizing User Segments Click and Conversion Responses to Internet Advertising and Its Applications

• Activity Number: 590
• Type: Contributed
• Date/Time: Wednesday, August 4, 2010 : 2:00 PM to 3:50 PM
• Sponsor: Section on Statistics and Marketing
• Author(s): Jaimyoung Kwon*+ and Benjamin Jackson and Rohan Mehta and Marius Holtan
• Companies: AOL Advertising and AOL Advertising and AOL Advertising and AOL Advertising
• Keywords: internet advertising ; principal component ; visualization ; internet user behavior

Abstract

To maximize the return-on-investment (ROI) of an internet advertising campaign, it is critical to identify which behavioral and demographic user segments respond to a particular campaign via clicks and conversions. In this study, we present a method for compactly summarizing click and conversion responses of user segments to a banner campaign using anonymous data, and ways to visualized multiple campaigns in the "campaign universe" via principal component analysis. In application of the analysis to multiple campaigns, we find that different age groups exhibit distinct click and conversion behaviors. Among others, teens click a lot more than other age groups but convert less. We discuss the implication of the findings on the impression-to-conversion and the click-to-conversion pricing models that are now widely used in the industry.