Fast and Feasible: Permutation-based Constrained Reranking for Revenue Maximization

Search and recommender systems have produced highly relevant search results. A natural next step in the development of such systems in e-commerce is to rerank these results to increase the platform's revenue from paid promotion products. However, maximizing revenue alone may degrade the user experience by reducing relevance or increasing fraud risk. To avoid this, we state the reranking problem as an integer linear program ($ILP$) that maximizes revenue subject to per-query constraints on other metrics, e.g., relevance. Since solving $ILP$ exactly for every query is slow for deployment to the online service, we propose a lightweight permutation-based reranking approximation algorithm PermR. At each step, the algorithm selects a pair of neighboring items and swaps them to either improve the objective or repair a violated constraint. We evaluate PermR across multiple categories of a large classified platform in offline and online settings. PermR achieves about 63\% of the ILP revenue improvement, within production latency limits, preserving all constraints. In a 14-day online A/B test over 56 million search queries, PermR increased revenue by $2$\%.

Optimizing Online Advertising with Multi-Armed Bandits: Mitigating the Cold Start Problem under Auction Dynamics

Online advertising platforms often face a common challenge: the cold start problem. Insufficient behavioral data (clicks) makes accurate click-through rate (CTR) forecasting of new ads challenging. CTR for "old" items can also be significantly underestimated due to their early performance influencing their long-term behavior on the platform. The cold start problem has far-reaching implications for businesses, including missed long-term revenue opportunities. To mitigate this issue, we developed a UCB-like algorithm under multi-armed bandit (MAB) setting for positional-based model (PBM), specifically tailored to auction pay-per-click systems. Our proposed algorithm successfully combines theory and practice: we obtain theoretical upper estimates of budget regret, and conduct a series of experiments on synthetic and real-world data that confirm the applicability of the method on the real platform. In addition to increasing the platform's long-term profitability, we also propose a mechanism for maintaining short-term profits through controlled exploration and exploitation of items.