Dr. Niklas Karlsson (Vice President of Research & Development, Advertising.com Group, AoL)

Title: Applications of Statistics, Optimization, and Feedback Control in Online Advertising

Abstract: Internet advertising revenues in the US hit $7.88 billion for the fourth quarter of 2012. This already large number together with the forecast of 23.3% year-over-year growth underscores the significance of online advertising as an industry and reflects the fact that the world is entering the media economy. Despite the current state of the economy, internet ad spending is expected to continue increasing faster than most other industry sectors. One way of turning this growing industry into a viable business is by providing algorithmic match making between advertisers and publishers in an ad network; i.e., by figuring out where, when, and how to show ads to the satisfaction of publishers and advertisers while maximizing the profit of the network. An ad network is a good example of a complex and very high-dimensional optimization problem and the presentation will describe interesting properties of this system. The presentation will also show how the problem leads to interesting and challenging problems in statistical inference, game theory, and feedback control and will suggest how some of these problems can be solved.