Informs 2015

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INFORMS Philadelphia – 2015
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45-Room 103C, CC
Revenue Management in Online Advertising
Sponsor: Revenue Management and Pricing
Sponsored Session
Chair: Hamid Nazerzadeh, University of Southern California, Bridge
Memorial Hall, 3670 Trousdale Parkway, Los Angeles, CA, 90089,
United States of America,
1 - Recent Results in Internet Advertising Allocations
Nitish Korula, Research Scientist, Google, New York,
Morteza Zadimoghaddam, Hossein Esfandiari,
Vahab Mirrokni
Advertising provides the economic foundation of the Internet. Internet
advertising applications motivate a host of optimization problems with unique
challenges and as such, there is a large body of literature on optimizing various
aspects of ad allocations. I will survey some of the recent work in this field, with
special focus on two problems: Designing algorithms that work well in both
adversarial and stochastic settings, and algorithms that balance multiple system
objectives.
2 - Multi-stage Intermediation in Online Internet Advertising
Ozan Candogan, University of Chicago,
Booth School of Business, Chicago, United States of America,
, Santiago Balseiro,
Huseyin Gurkan
We consider a setting where an advertiser tries to acquire impressions from an ad
exchange, through a chain of intermediaries. We characterize equilibrium profits
of intermediaries as a function of their position in the chain. We consider three
value distributions for the advertiser: (i) exponential, (ii) Pareto, (iii) uniform. We
establish that in (i) all intermediaries have the same profit, whereas in (ii) and
(iii) respectively downstream/upstream intermediaries have higher profits.
3 - Adverse Selection and Auction Design for Internet
Display Advertising
Nick Arnosti, Stanford University, Stanford, CA, United States of
America, , Marissa Beck, Paul Milgrom
We model an online display advertising environment with brand advertisers and
better-informed performance advertisers. We consider a mechanism which assigns
the item to the highest bidder only when the ratio of the highest bid to the second
highest bid is sufficiently large. For fat-tailed match-value distributions, this
mechanism captures most of the gains from good matching and improves match
values substantially compared to the common practice of setting aside impressions
in advance.
4 - Deals or No Deals: Contract Design for Selling Online Advertising
Hamid Nazerzadeh, University of Southern California, Bridge
Memorial Hall, 3670 Trousdale Parkway, Los Angeles, CA, 90089,
United States of America, ,
Vahab Mirrokni
I will discuss some of the challenges in maximizing revenue of online advertising
market. I will explain preferred deals: a new generation of contracts for selling
display advertising that allow publishers to offer their inventory to “first look”
buyers before the inventory is made available to other buyers (advertiser) in the
general auction. I present algorithms for deal recommendation and show that
deals can obtain significantly higher revenue than auctions.
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46-Room 104A, CC
Managing Professional Services
Sponsor: Manufacturing & Service Oper Mgmt/Service Operations
Sponsored Session
Chair: Morvarid Rahmani, Assistant Professor, Georgia Tech,
1 - The Design of Multi-stage Service Processes
Ioannis Bellos, Assistant Professor, George Mason University-
ISOM Area, Enterprise Hall, 4400 University Drive, MS 5F4,
Fairfax, VA, 22030, United States of America,
Stelios Kavadias
Motivated by the practices of design firms we build on the customer journey
concept, which describes services as multi-stage processes. We develop a
parsimonious model and we analyze the provider’s decisions on the amount of
effort she exerts at each stage of the process and the overall price she charges.
2 - Skill and Capacity Management in Large-scale
Service Marketplaces
Eren Cil, University of Oregon, 1585 East 13th Avenue,
Eugene, OR, United States of America,
Achal Bassamboo, Gad Allon
We characterize the optimal skill screening mechanism of a firm moderating a
large-scale service marketplace where the ability of a service provider to cater
customers, who can be of two classes, varies. We show that when the values that
a service provider generates for each customer class are independent, the firm
may need to refuse some of the service providers via its screening mechanism
whereas this is never optimal when these values are perfectly correlated.
3 - Pricing Diagnosis-based Services when Customers Exhibit
Sunk Cost Bias
Guangwen Kong, University of Minnesota, 111 Church Street SE,
Minneapolis, MN, 55414, United States of America,
, Sampath Rajagopalan, Chunyang Tong
We build a model to shed light on how sunk-cost effect influences the SP’s choice
of pricing scheme. We provide an analysis on how the sunk cost effect influences
a monopolistic SP’s choice of pricing scheme, and then examine the impact of
sunk-cost effects in a competitive setting. Further, we consider customers with
differing levels of sophistication (being naïve or sophisticated) and investigate
how a mixture of customer types further impacts the choice of pricing scheme.
4 - Balancing Experience in Fluid Teams: Team Familiarity, Partner
Diversity and Performance
Sarang Deo, Assistant Professor, Indian School of Business
Hyderabad, ISB Hyderabad, Gachibowli, Hyderabad, TS, 500032,
India, , Kamalini Ramdas, Zeynep Aksin,
Jonas Jonasson
We use data from London Ambulance Service to study the impact of partner
diversity of new paramedics on their operational performance. We find that the
greater diversity in prior partners directly improves performance for an
unstandardized process. For a more standardized process, this effect is moderated
by a new recruit’s total experience. We explore the implications of our results for
team formation strategies by balancing the benefits of partner diversity with those
of team familiarity.
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47-Room 104B, CC
Incentives and Investment in Renewable Energy and
Energy Efficiency
Sponsor: Manufacturing & Service Oper Mgmt/Sustainable
Operations
Sponsored Session
Chair: Owen Wu, Indiana University, 1309 E. 10th Street,
Bloomington, IN, 47405, United States of America,
1 - Impact of Electricity Pricing Policy on Renewable Energy
Investments and Carbon Emissions
Safak Yucel, PhD Candidate, Duke University, 100 Fuqua Drive,
Durham, NC, 27708, United States of America,
, Gurhan Kok, Kevin Shang
We investigate the impact of electricity pricing policy (i.e., flat pricing versus peak
pricing) on renewable energy investments and carbon emissions. We find that flat
pricing generally leads to a higher investment level and lower carbon emissions.
Furthermore, our results indicate that the pricing policy that leads to higher
investments may not reduce carbon emissions. We also study the effects of
subsidy policies on the investments and emissions.
2 - Robustness of Renewable Energy Support Schemes
Stefan Spinler, Professor, WHU-Otto Beisheim School of
Management, Burgplatz 2, Vallendar, 56179, Germany,
, Ingmar Ritzenhofen, John Birge
Renewable portfolio standards (RPS), feed-in-tariffs (FIT), and market premia
(MP) are widely used policy instruments to promote investments in renewable
energy sources (RES). Regulators continuously evaluate these instruments along
the main electricity policy objectives of affordability, reliability, and sustainability.
We assess these policies using a long-term dynamic capacity investment model
and compare their robustness in the light of uncertain RES feed-in and
ambiguous future regulation.
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