It has become increasingly common that sponsored content (i.e., paid ads) and non-sponsored content are jointly displayed to users, especially on e-commerce platforms. Thus, both of these contents may interact together to influence their engagement behaviors. In general, sponsored content helps brands achieve their marketing goals and provides ad revenue to the platforms. In contrast, non-sponsored content contributes to the long-term health of the platform through increasing users' engagement. A key conundrum to platforms is learning how to blend both of these contents allowing their interactions to be considered and balancing these business objectives. This paper proposes a system built for this purpose and applied to product detail pages of JD.COM, an e-commerce company. This system achieves three objectives: (a) Optimization of competing business objectives via Virtual Bids allowing the expressiveness of the valuation of the platform for these objectives. (b) Modeling the users' click behaviors considering explicitly the influence exerted by the sponsored and non-sponsored content displayed alongside through a deep learning approach. (c) Consideration of a Vickrey-Clarke-Groves (VCG) Auction design compatible with the allocation of ads and its induced externalities. Experiments are presented demonstrating the performance of the proposed system. Moreover, our approach is fully deployed and serves all traffic through JD.COM's mobile application.

Comparison Lift is an experimentation-as-a-service (EaaS) application for testing online advertising audiences and creatives at JD.com. Unlike many other EaaS tools that focus primarily on fixed sample A/B testing, Comparison Lift deploys a custom bandit-based experimentation algorithm. The advantages of the bandit-based approach are two-fold. First, it aligns the randomization induced in the test with the advertiser’s goals from testing. Second, by adapting experimental design to information acquired during the test, it reduces substantially the cost of experimentation to the advertiser. Since launch in May 2019, Comparison Lift has been utilized in over 1,500 experiments. We estimate that utilization of the product has helped increase click-through rates of participating advertising campaigns by 46% on average. We estimate that the adaptive design in the product has generated 27% more clicks on average during testing compared to a fixed sample A/B design. Both suggest significant value generation and cost savings to advertisers from the product.

Firms implementing digital advertising campaigns face a complex problem in determining the right match between their advertising creatives and target audiences. Typical solutions to the problem have leveraged non-experimental methods, or used “split-testing” strategies that have not explicitly addressed the complexities induced by targeted audiences that can potentially overlap with one another. This paper presents an adaptive algorithm that addresses the problem via online experimentation. The algorithm is set up as a contextual bandit and addresses the overlap issue by partitioning the target audiences into disjoint, non-overlapping sub-populations. It learns an optimal creative display policy in the disjoint space, while assessing in parallel which creative has the best match in the space of possibly overlapping target audiences. Experiments show that the proposed method is more efficient compared to naive “split-testing” or non-adaptive “A/B/n” testing based methods. We also describe a testing product we built that uses the algorithm. The product is currently deployed on the advertising platform of JD.com, an eCommerce company and a publisher of digital ads in China.