Reserve prices in internet advertising auctions: a field experiment

Authors:
Michael Ostrovsky;Michael Schwarz
Affiliations:
Stanford University, Stanford, CA, USA;Yahoo! Labs, Berkeley, CA, USA
Venue:
Proceedings of the 12th ACM conference on Electronic commerce
Year:
2011

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Abstract

We present the results of a large field experiment on setting reserve prices in auctions for online advertisements, guided by the theory of optimal auction design suitably adapted to the sponsored search setting. Consistent with the theory, following the introduction of new reserve prices revenues in these auctions have increased substantially.